EXPLANATORY STATEMENT
NATIONAL HEALTH ACT 1953
National Health (Supplies of out-patient medication) Amendment Determination 2012 (No.1)
PB 88 of 2012
Authority
Subsection 84BA(2) of the National Health Act 1953 (the Act) provides that the Minister must determine the amount that will be taken to have been paid to a public hospital for supplies of out-patient medication for the purposes of safety net.
Purpose
The purpose of this legislative instrument, made under subsection 84BA(2) of the Act, is to amend the National Health (Supplies of out-patient medication) Determination 2011 (PB 103 of 2011) (the Determination), to make changes to the determination of the amounts taken to have been paid to a public hospital for supplies of out-patient medication.
Division 1A of Part VII of the Act provides for a ‘safety net scheme’ in relation to pharmaceutical benefits. The safety net scheme is designed to provide financial protection for those patients and their families who require a large number of pharmaceutical benefits.
Subsection 84BA(1) of the Act provides that the purpose of section 84BA of the Act is to make provision so that account may be taken of payments made by a person to a public hospital authority for supplies of out-patient medication, when it is being ascertained whether the person is eligible to be issued with a safety net concession card or a safety net entitlement card.
This Instrument amends the Determination to remove references to ‘approved price to pharmacists’ and replace those references with ‘approved ex-manufacturer price or proportional ex-manufacturer price’. This amendment makes technical consequential changes to reflect amendments made to the Act by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012 (the Amending Act), which commences 1 October 2012. The Amending Act removes ‘approved price to pharmacists’ as the PBS base price under the Act and replaces it with ‘approved ex-manufacturer price’.
This Instrument also amends the Determination to replace references to the ‘National Healthcare Agreement’ and with references to the ‘National Health Reform Agreement’. This amendment reflects amendments to the Federal Financial Relations Act 2009 that commenced 25 June 2012. The Federal Financial Relations Act 2009 refers to the National Health Reform Agreement as agreed to by the Council of Australian Governments on 2 August 2011 as amended from time to time. A copy of the National Health Reform Agreement can be obtained at the Council of Australian Governments (“COAG”) website at http://www.coag.gov.au.
The amendments do not alter the amount that, under the Determination, is taken to have been paid to the hospitals for the supply of out-patient medication. These amounts are determined each year, before the entitlement period (calendar year), for the entitlement period.
Consultation
The changes made by this Amendment Determination are consequential to changes to the Act and are technical and machinery in nature. No consultation was undertaken.
This instrument commences on 1 October 2012.
This instrument is a legislative instrument for the purpose of the Legislative Instrument Act 2003.
Overview
The National Health (Supplies of out-patient medication) Amendment Determination 2012 (No. 1) was enacted to amend the National Health (Supplies of out-patient medication) Determination 2011, made under subsection 84BA(2) of the National Health Act 1953. This amendment was introduced to reflect changes in the Act made by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012, which removed ‘approved price to pharmacists’ as the PBS base price and replaced it with ‘approved ex-manufacturer price’. The purpose of these amendments is to ensure that the determination of the amounts paid to public hospitals for out-patient medication aligns with these legislative changes, thereby maintaining consistency and accuracy in the safety net scheme for pharmaceutical benefits. Additionally, the amendments update references from the ‘National Healthcare Agreement’ to the ‘National Health Reform Agreement’, reflecting changes in federal financial relations legislation. This amendment does not affect the amounts taken to have been paid to hospitals for out-patient medication, which are determined annually before the entitlement period.
Scope and Application
The National Health (Supplies of out-patient medication) Amendment Determination 2012 (No.1) amends the National Health (Supplies of out-patient medication) Determination 2011 to reflect changes made to the National Health Act 1953 by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012. This legislative instrument applies to public hospitals in Australia and the amounts taken to have been paid for supplies of out-patient medication, specifically for the purposes of the safety net scheme designed to provide financial protection for patients requiring a large number of pharmaceutical benefits. The amendments involve technical changes to update the terminology used in the Determination to align with the changes in the Act, such as replacing references to the "approved price to pharmacists" with "approved ex-manufacturer price or proportional ex-manufacturer price". Additionally, it updates references from the "National Healthcare Agreement" to the "National Health Reform Agreement" to reflect amendments to the Federal Financial Relations Act 2009. The amounts deemed to have been paid to hospitals for out-patient medication remain unchanged by these amendments. This determination commenced on 1 October 2012 and serves as a legislative instrument under the Legislative Instruments Act 2003.
Key Provisions
The main operative sections of the National Health (Supplies of out-patient medication) Amendment Determination 2012 (No. 1) are sections that amend the National Health (Supplies of out-patient medication) Determination 2011. Specifically, section 2 of the Amendment Determination replaces references to the ‘approved price to pharmacists’ with ‘approved ex-manufacturer price or proportional ex-manufacturer price’. This change aligns with the amendments made to the National Health Act 1953 by the National Health Amendment (Pharmaceutical Benefits Scheme) Act 2012, which introduced the concept of approved ex-manufacturer prices as the base price for the Pharmaceutical Benefits Scheme (PBS). Section 3 of the Amendment Determination further replaces references to the ‘National Healthcare Agreement’ with ‘National Health Reform Agreement’, reflecting the changes to the Federal Financial Relations Act 2009 that also commenced on 25 June 2012. These changes ensure that the Determination remains consistent with current legislation and agreements.
The obligations and requirements imposed by this Amendment Determination are primarily technical and consequential. Public hospitals supplying out-patient medication must continue to be aware of the amounts determined by the Minister, which are taken to have been paid to the hospital for such supplies for the purposes of the safety net scheme. These amounts are determined annually and remain unchanged by the Amendment Determination. Public hospitals must also ensure that their billing and record-keeping practices align with the updated terminology and references as set out in the amended Determination. This includes updating any relevant documentation or systems to reflect the new terms such as ‘approved ex-manufacturer price’ and ‘National Health Reform Agreement’.
The Amendment Determination itself does not introduce new offences, penalties, or consequences for non-compliance. However, any breach of the underlying National Health Act 1953 or related agreements could result in civil or criminal liability. For instance, if a public hospital fails to comply with the requirements for determining payments for out-patient medication, it could potentially impact a patient's eligibility for a safety net concession card or entitlement card. Such an impact could lead to financial hardship for the patient or their family, although this would be a consequence of non-compliance with the Act rather than a specific penalty under the Amendment Determination. The penalties for breaches of the National Health Act 1953 would need to be referred to under the primary legislation itself.