Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 2)

EXPLANATORY STATEMENT

Issued by the Authority of the Minister for Health and Ageing

Private Health Insurance Act 2007

Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 2))

Section 333-20 of the Private Health Insurance Act 2007 (the Act) provides that the Minister may make Private Health Insurance (Benefit Requirements) Rules providing for matters required or permitted by Part 3-3 of the Act, or necessary or convenient to be provided in order to carry out or give effect to Part 3-3 of the Act.

The Private Health Insurance (Benefit Requirements) Rules 2008 (No. 2) (the Rules) (as amended), which commenced on 1 July 2008, provide for the minimum benefit requirements for psychiatric, rehabilitation and palliative care and other hospital treatment. Schedules 1 to 5 of the Rules set out the minimum levels of benefit which are payable for hospital treatment. Namely, benefits for overnight accommodation (Schedules 1 and 2), same day accommodation (Schedule 3), nursing-home type patients (Schedule 4) and second tier default benefits (Schedule 5).

The Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 2) (the Amending Rules) amend Schedule 1, 3, 4 and 5 of the Rules. 

The purpose of the amendments to Schedules 1 and 3 is to reflect changes in the Medical Benefits Schedule (“MBS”) items which commenced 1 March 2009.

The purpose of the amendments to Schedule 1 is to include two new MBS item numbers in Part 2 - Type A Procedures, Clause 4 Advanced Surgical Patients. Advanced Surgical Patients are those patients who satisfy the requirements in Part 2 subclause 4(2). MBS item numbers that can be claimed by Advanced Surgical Patients are listed in Part 2 subclause 4(3) provided those items have a fee in the MBS greater than $788.01

The purpose of the amendment to Schedule 3 is to include one new MBS item number in Part 3 - Type C Procedures.  Type C procedures are those procedures for which hospital treatment is not normally required. Minimum benefits for either overnight accommodation or day-only accommodation are payable for patients receiving certified Type C procedures where the certification requirements in the Rules have been satisfied.  

The purpose of the amendments to Schedule 4 of the Rules is to reflect the changes in the minimum benefits for hospital treatment for patients who are classified as “nursing-home type patients” at public hospitals in certain States/Territories and at private hospitals nationally to reflect the bi-annual pension increase that will be effective from 20 March 2009.

The purpose of the amendments to Schedule 5 of the Rules is to ensure that three new facilities are eligible for second tier default benefits. The insertion of three new facilities into the table at clause 4 of Schedule 5 of the Rules increases the table from 300 facilities to 303 facilities. 

Details of the Amendment Rules are set out in the Attachment.

Consultation

The changes to the MBS resulted from reviews by the Medicare Benefit Consultative Committee (“MBCC”) and the Medicare Services Advisory Committee (“MSAC”).  The MBCC is an advisory committee established by agreement between the Minister for Health and Ageing and the Australian Medical Association. MBCC’s major function is to review particular services or groups of services in the MBS, including consideration of appropriate fee levels.  MSAC advises the Minister of new and emerging medical services and under what circumstances public funding, including listing on the MBS, should be supported.

No specific consultation was undertaken in relation to the amendments to Schedules 1 and 3 of the Rules because the changes were machinery in nature and did not substantially alter existing arrangements.  The amendments to Schedule 1 and 3 are part of the ongoing management of the Private Health Insurance (Benefit Requirements) Rules.

The amendments to Schedule 4 of the Rules were made with the agreement of the relevant State and Territory health authorities.

Consultation for changes to Schedule 5 occurred with industry through the Second Tier Advisory Committee, which includes equal representation from both the private hospital and private health insurance sectors.

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

MARCH 2009

ATTACHMENT

DETAILS OF THE PRIVATE HEALTH INSURANCE (BENEFIT REQUIREMENTS) AMENDMENT RULES 2009 (No. 2)

1. Name of Rules

Rule 1 provides that the title of the Rules is the Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 2) (the Amendment Rules).

2. Commencement

Rule 2 provides that the Amendment Rules are to commence on 20 March 2009 or, if registered on a later date, the day after registration.

3.              Amendment of Private Health Insurance (Benefit Requirements) Rules 2008 (No. 2)

Rule 3 provides that the Schedule to the Amendment Rules amends the Rules which commenced on 1 July 2008 and were amended on 18 July 2008, 20 September 2008, 1 November 2008, 20 December 2008 and 24 February 2009.

Schedule – Amendments

Item 1 – Schedule 1, Part 2, Subclause 4(3)

Schedule 1 Part 2 subclause 4(3) of the Rules provides the item numbers in the Medical Benefit Schedule (“MBS”) for the purpose of clause 4 of the Rules, but indicates that a listing in subclause 4(3) only applies where an item has a fee in the MBS greater than $788.01.

Item 1 of the Schedule to the Amendment Rules amends subclause 4(3) Part 2, Schedule 1 of the Rules to insert new MBS item numbers 32220 and 32221. This insertion reflects new MBS numbers that were created in the Health Insurance (Faecal Incontinence and Peutz-Jeghers Syndrome) Determination 2009 (“FIPJ Determination”) which was made under section 3C of the Health Insurance Act 1973 (“HI Act”). Under section 3C these new MBS item numbers are to be treated as if they were items in the Health Insurance (General Medical Services Table) Regulations 2008 (GMST). The new items commenced on 1 March 2009 and will cease to have effect at the end of 30 June 2009.

Item 2 – Schedule 3, Part 3, Clause 8 Interpretation, Items in the general medical services table, in the list after D1

Clause 8 of the Rules provides that a Type C procedure is a procedure specified in clause 8 by reference to MBS items.

Item 2 of the Schedule to the Amendment Rules amends Clause 8, Part 3, Schedule 3 of the Rules to insert new MBS item number 11823 at D1 - Diagnostic Procedures & Investigation.  This insertion reflects the new MBS item that was created in the FIPJ Determination which was made under section 3C of the HI Act. Under section 3C the new MBS item is to be treated as if they were items in the GMST. The new item commenced on 1 March 2009 and will cease to have effect at the end of 30 June 2009.

Item 3 – Schedule 4, clause 6, Minimum benefit, Table 1

Schedule 4 of the Rules set out the minimum benefit payable per night for patients that are classified as Nursing Home Type Patients in hospitals.  

Item 3 of the Schedule to the Amendment Rules increases the minimum benefit per night for public hospitals in the following States and Territories in clause 6, Table 1:

• NSW -    From: $97.60 to $101.65;
• Tasmania -  From: $97.90 to $99.25; and
• Victoria -   From: $97.15 to $99.15

Item 4 – Schedule 4, clause 6 Minimum benefit, Table 2

Schedule 4 of the Rules set out the minimum benefit payable per night for patients that are classified as Nursing Home Type Patients in hospitals.

Item 4 of the Schedule to the Amendment Rules decrease the minimum benefit per night for private hospitals in clause 6, Table 2:

• Private hospitals - From: $70.30 to $69.75.

Item 5 – Schedule 5, Clause 4 Facilities, Table

Schedule 5 of the Rules requires a health insurer to pay second tier default benefits for most episodes of hospital treatment provided in private hospital facilities that are specified in Schedule 5 if the health insurer does not have a negotiated agreement with the hospital. Schedule 5 sets a higher minimum level of benefit (for overnight treatment and day only treatment provided in specified facilities) than the minimum benefit set for such treatment by Schedules 1, 2 and 3 of the Rules. 

Item 5 of the Schedule to the Amendment Rules amends clause 4 of Schedule 5 of the Rules to specify that three new facilities are entitled to second tier default benefits.  

The new facilities are:

As a result of these insertions the table has increased from 300 facilities to 303 facilities.

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

MARCH 2009