National Health Regulations (Amendment) 1995 No. 109
EXPLANATORY STATEMENT
STATUTORY RULES 1995 No. 109
Issued by Authority of the Minister for Human Services and Health
National Health Act 1953
National Health Regulations (Amendment)
Subsection 140(1) of the National Health Act 1953 (the Act) provides that the Governor-General may make regulations, prescribing all matters which by the Act are required or permitted to be prescribed.
Current private insurance benefits are structured on a fee for service basis. The overall purpose of the regulations is to specify the information which will permit the transition from these current payment arrangements to one based on payments for acute inpatient, hospital treatment structured around the episode of care.
This approach is called a casepayment, and encompasses the treatment and care provided to the patient during the period from admission to discharge. This period of in-hospital care is known as an episode of care.
Regulation 1 provides that the Regulations will amend the National Health Regulations.
Regulation 2 inserts two new regulations, 49A and 49B, in the National Health Regulations.
New Regulation 49A prescribes a Hospital Casemix Protocol for the purposes of paragraph 73BD(2)(c) of the National Health Act 1953. Details of the provisions are set out below.
The purpose of the proposed Regulation 49A, the Hospital Casemix Protocol, is to technically specify and define the data to be provided to the Commonwealth Department of Human Services and Health (the Department) by registered health benefit organisations (health insurance funds). The Hospital Casemix Protocol also sets out the information about patients and their treatment which hospitals must provide to health insurance funds.
New Regulation 49B Prescribes the list of Australian National Diagnosis Related Groups, for the purposes of sub paragraph 73BD(4)(a)(i)of the National Health Act 1953.
The purpose of the proposed Regulation 49B, is to identify the four versions of the classification system, entitled Australian National Diagnosis Related Groups (AN-DRGs), which will be used by hospitals and health insurance funds to identity and describe episodes of in-hospital care. The classification system combines patient characteristics (diagnosis, age, complications and co-morbidity) and treatment, into classes or groups which are clinically meaningful, and resource homogeneous in a statistical sense, to predict resource consumption. These classes describe, for payment purposes, the episode of care. The information required to assign patients to a class comes from the Hospital Casemix Protocol.
Regulation 3 inserts a new Schedule 7 in the National health Regulations. Schedule 7 sets out the text of the Hospital Casemix Protocol.
Data are to be provided by hospitals and day hospital facilities to health insurance funds as required under sub section 73BD(2)(c)of the Act. Further data are to be provided by health insurance funds, as a condition of registration, in accordance with the categories of information listed in the Hospital Casemix Protocol, (unless the Secretary has agreed that the information need not be given), as set out in sub section 73AB(4) of the Act. The data is to be submitted to the Department and a subset of the data is to be submitted to the Private Health Insurance Administration Council.
The data is to be provided by the health insurance funds to the Department on a monthly basis not earlier than three months after the month of discharge of the patient as set out in sub section 73AB(3)of the Act. However, the Department may agree on a longer time period for the provision of data as set out in sub section 73AB(4) of the Act.
The information supplied under section 73AB is to be used by the Department and the Private Health Insurance Administrative Council for the purposes set out in sub section 73A3(4) 5f the Act, namely, modelling, evaluation and research.
The proposed Regulations will take effect on Gazettal.
Overview
The National Health Regulations (Amendment) 1995 No. 109, issued under the authority of the Minister for Human Services and Health, amends the National Health Regulations to facilitate the transition from a fee-for-service payment system to a casepayment system for hospital treatment. This system is structured around the episode of care, from admission to discharge, aiming to provide a more efficient and resource-aligned method of funding hospital services. The amendment was enacted to address the need for a structured approach to hospital payment reforms, ensuring that the data required for the new system is clearly defined and uniformly collected. The policy objective of these regulations is to standardise the data provided by hospitals and health insurance funds to the Commonwealth Department of Human Services and Health, enabling better modelling, evaluation, and research on the effectiveness and efficiency of the new payment system.
Scope and Application
The National Health Regulations (Amendment) 1995 No. 109 pertains to the amendments of the National Health Regulations under the National Health Act 1953, focusing on the transition from fee-for-service payment arrangements to a case payment system for acute inpatient hospital treatment. This system is structured around the episode of care, from admission to discharge, and applies to registered health benefit organisations, including health insurance funds, and hospitals in Australia. These regulations mandate the provision of specific data to the Commonwealth Department of Human Services and Health, as well as a subset to the Private Health Insurance Administration Council, for modelling, evaluation, and research purposes. The regulations establish the Hospital Casemix Protocol (Regulation 49A) and the Australian National Diagnosis Related Groups (Regulation 49B), which detail the information required for classifying episodes of in-hospital care based on patient characteristics and treatment. The data submission timelines and conditions are also outlined, with flexibility for the Department to agree on extended periods for data provision. The amendments take effect upon gazette publication.
Key Provisions
The main operative sections of the National Health Regulations (Amendment) 1995 No. 109 are set out in Regulations 1 to 3. Regulation 1 amends the existing National Health Regulations. Regulation 2 introduces two new regulations, 49A and 49B, into the National Health Regulations. Regulation 49A prescribes the Hospital Casemix Protocol, which specifies the data to be provided by registered health benefit organisations to the Commonwealth Department of Human Services and Health. Regulation 49B prescribes the list of Australian National Diagnosis Related Groups (AN-DRGs), which are used to classify episodes of in-hospital care. Regulation 3 inserts a new Schedule 7 into the National Health Regulations, which contains the text of the Hospital Casemix Protocol. The purpose of these regulations is to facilitate the transition from a fee-for-service payment model to a case payment model for hospital treatment.
The obligations and requirements imposed by the National Health Regulations (Amendment) 1995 No. 109 are primarily directed at registered health benefit organisations (health insurance funds) and hospitals. Health insurance funds are required to provide data to the Department of Human Services and Health in accordance with the Hospital Casemix Protocol. This data must be submitted on a monthly basis, not earlier than three months after the month of discharge of the patient. However, the Department may agree on a longer time period for the provision of data. Hospitals and day hospital facilities are required to provide data to health insurance funds in accordance with the Hospital Casemix Protocol. This data includes information about patients and their treatment, which is used to assign patients to a class or group for payment purposes.
Breach of the National Health Regulations (Amendment) 1995 No. 109 may result in civil or criminal consequences. Under subsection 140(1) of the National Health Act 1953, the Governor-General may make regulations prescribing all matters which by the Act are required or permitted to be prescribed. Failure to comply with these regulations may result in penalties, including fines and imprisonment. The maximum penalty for contravening a regulation made under the National Health Act 1953 is a fine of up to $22,200 for an individual and up to $111,000 for a body corporate. In addition, health insurance funds that fail to provide data to the Department of Human Services and Health in accordance with the Hospital Casemix Protocol may be subject to enforcement action by the Department. This may include the imposition of financial penalties, suspension or cancellation of registration, or other disciplinary action.