EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Health
Private Health Insurance Act 2007
Private Health Insurance (Accreditation) Amendment Rules 2019
Authority
Section 333-20 of the Private Health Insurance Act 2007 (the Act) provides that the Minister may make Private Health Insurance (Accreditation) Rules providing for matters required or permitted by Section 81-1 of the Act, or necessary or convenient to be provided in order to carry out or give effect to Section 81-1 of the Act.
Purpose
The purpose of the Private Health Insurance (Accreditation) Amendment Rules 2019 (the Amendment Rules) is to amend the Private Health Insurance (Accreditation) Rules 2011 (the Principal Rules) to repeal subrule 7(3) which no longer has effect, and to update the reference to the Health Insurance Regulations as a consequence of the repeal of the Health Insurance Regulations 1975 and commencement of Health Insurance Regulations 2018 from 1 October 2018.
The Amendment Rules amend the Principal Rules by repealing subrule 7(3) which ceased to have effect on 1 January 2013.
The Amendment Rules also amend the Principal Rules by updating the reference to the Health Insurance Regulations in subrule 9(1) to section 12 of the Health Insurance Regulations 2018. This is a consequential amendment to preserve existing arrangements.
Details of the Amendment Rules are set out in the Attachment.
Background
Section 81-1 of the Act provides that an insurance policy meets the quality assurance requirements in Division 81 of the Act if the policy prohibits the payment of private health insurance benefits for a treatment that does not meet the standards in the Private Health Insurance (Accreditation) Rules. An insurance policy must meet the quality assurance requirements in Division 81 where it is offered by a private health insurer as a complying health insurance policy in accordance with section 63-10 of the Act.
Consultation
No consultation was undertaken because the changes are administrative in nature and preserve existing arrangements.
The Amendment Rules commence on the day after the instrument is registered.
The Amendment Rules are a legislative instrument for the purposes of the Legislation Act 2003.
ATTACHMENT
DETAILS OF THE PRIVATE HEALTH INSURANCE (ACCREDITATION) AMENDMENT RULES 2019
Section 1 Name of Rules
Section 1 provides that the title of the instrument is the Private Health Insurance (Accreditation) Amendment Rules 2019 (the Amendment Rules).
Section 2 Commencement
Section 2 provides that the Amendment Rules commence on the day after registration.
Section 3 Authority
Section 3 provides that the Amendment Rules are made under item 5 of the table in section 333-20 of the Private Health Insurance Act 2007.
Section 4 Schedules
Section 4 provides that each instrument specified in the Schedule of the Amendment Rules is amended or repealed as set out in the applicable items in the Schedule, and any other item in a Schedule to this instrument has effect according to its terms.
Schedule 1 – Amendments
Item 1 of Schedule 1 amends the Private Health Insurance (Accreditation) Rules 2011 by repealing subrule 7(3) which ceased to have effect on 1 January 2013.
Item 2 of Schedule 1 amends the Private Health Insurance (Accreditation) Rules 2011 by updating the reference to the Health Insurance Regulations to section 12 of the Health Insurance Regulations 2018.
Overview
The Private Health Insurance (Accreditation) Amendment Rules 2019 were enacted to amend the Private Health Insurance (Accreditation) Rules 2011. These amendments were introduced to ensure the continued effectiveness and relevance of the rules in line with the broader legislative framework governing private health insurance in Australia. The Private Health Insurance Act 2007 empowers the Minister for Health to make these rules to facilitate the accreditation process and maintain quality assurance standards in private health insurance policies. The policy objective is to streamline the regulatory framework and preserve existing arrangements by repealing outdated provisions and updating references to align with the new Health Insurance Regulations 2018. The changes are administrative in nature and were implemented without consultation as they do not introduce new policy measures but rather ensure the regulatory framework remains current and functional.
Scope and Application
The Private Health Insurance (Accreditation) Amendment Rules 2019, made under Section 333-20 of the Private Health Insurance Act 2007, amend the Private Health Insurance (Accreditation) Rules 2011 to reflect legislative changes and ensure ongoing compliance with the Act. These Amendment Rules apply to private health insurers and their policies, ensuring that the quality assurance requirements set out in Division 81 of the Act are met by prohibiting the payment of private health insurance benefits for treatments that do not meet the standards outlined in the Accreditation Rules. The Amendment Rules remove outdated provisions and update references to align with the Health Insurance Regulations 2018, which came into effect on 1 October 2018, replacing the repealed Health Insurance Regulations 1975. This legislative update preserves existing arrangements and maintains the integrity of the quality assurance framework for private health insurance in Australia. The Amendment Rules are effective from the day after their registration and do not require consultation as they are administrative in nature.
Key Provisions
The Private Health Insurance (Accreditation) Amendment Rules 2019 (Amendment Rules) are amendments to the Private Health Insurance (Accreditation) Rules 2011 (Principal Rules), which were made under section 333-20 of the Private Health Insurance Act 2007. The purpose of these Amendment Rules is to update and streamline the Principal Rules in response to the repeal of the Health Insurance Regulations 1975 and the introduction of the Health Insurance Regulations 2018. Specifically, the Amendment Rules repeal subrule 7(3) of the Principal Rules, which no longer has effect since 1 January 2013, and update references to the Health Insurance Regulations in subrule 9(1) to section 12 of the Health Insurance Regulations 2018. These changes aim to preserve existing arrangements and ensure the rules remain aligned with current regulatory frameworks.
The Amendment Rules impose obligations on private health insurers to ensure their insurance policies comply with the updated accreditation rules. Insurers must ensure that their policies meet the quality assurance requirements set out in Division 81 of the Private Health Insurance Act 2007. This includes prohibiting the payment of private health insurance benefits for treatments that do not meet the standards outlined in the Private Health Insurance (Accreditation) Rules. By adhering to these rules, insurers ensure their policies are considered compliant health insurance policies under the Act.
Failure to comply with the Private Health Insurance (Accreditation) Amendment Rules 2019 may result in regulatory action against the private health insurer. The Act does not explicitly state penalties for non-compliance with these specific rules; however, breaches of the Private Health Insurance Act 2007 in general can result in significant civil or criminal penalties. For instance, individuals who contravene the Act can be subject to fines of up to $126,000 for personal misconduct and up to $630,000 for corporate misconduct. Additionally, officers of the corporation can face penalties of up to $126,000 for personal misconduct and up to $630,000 for corporate misconduct. These penalties underscore the importance of compliance with the rules and regulations governing private health insurance in Australia.