EXPLANATORY STATEMENT
Issued by Authority of the Minister for Health and Ageing
National Health Act 1953
Determination under Schedule 1, Paragraph (bj)
(HIB 07/2005) (HIB 08/2005)
Schedule 1, paragraph (bj) of the National Health Act 1953 (“the Act”) provides that the Minister may determine the minimum levels of benefits payable by a registered health benefits organisation for hospital treatment provided to contributors, other than in emergencies, in a hospital or day hospital facility with which the organisation does not have a hospital purchaser-provider agreement covering such treatment. These benefits are known in the industry as “default benefits”.
The current Determination was made on 30 June 1999 (as amended) and comprises eight schedules setting out the minimum benefit levels payable for a range of hospital treatment. These include benefits for overnight accommodation, day accommodation and surgically implanted prostheses, including human tissue items.
Determinations (HIB 07/2005) and (HIB 08/2005) amend the Determination made on 30 June 1999 by omitting Schedule 1 and Schedule 3 respectively and substituting a new Schedule 1 and Schedule 3.
Schedule 1 sets default benefits for overnight accommodation in certain situations by specifying the default benefits that are payable in relation to Medicare Benefits Schedule (MBS) item numbers.
Schedule 3 sets the default benefits payable for same day accommodation by specifying the default benefits that are payable in relation to MBS item numbers.
The new Schedule 1 and Schedule 3 has been amended by adding and deleting MBS item numbers to reflect equivalent changes made to the amended MBS effective on and from 1 May 2005.
These changes were necessary because both Schedules 1 and 3 link the default benefits that are payable to the types of professional services rendered to admitted hospital patients. The types of professional services rendered are identified by reference to MBS item numbers and fees.
CONSULTATION
The changes to the MBS resulted from reviews by the Medicare Benefits Consultative Committee (MBCC). The MBCC is an informal consultative forum with representation drawn from the Department of Health and Ageing, the Health Insurance Commission, the Australian Medical Association and relevant professional groups of the medical profession. The reviews conducted by the MBCC are designed to ensure that the MBS reflects current medical practice and encourages best practice.
The subsequent changes to Schedules 1 and 3 were necessary to ensure that health funds, at a minimum, pay the ‘default benefit’ for their members where members receive hospital treatment corresponding to one of the new MBS item numbers, in a hospital where that health fund does not have a contractual arrangement with that hospital. The amendments to Schedules 1 and 3 are of a machinery nature and do not substantially alter existing arrangements.
Determinations (HIB 07/2005) and (HIB 08/2005) commence on 1 May 2005. The determinations and this explanatory statement have been lodged for registration on the Federal Register of Legislative Instruments.
PRIVATE HEALTH INSURANCE BRANCH
DEPARTMENT OF HEALTH AND AGEING
APRIL 2005