Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 3)

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. 3)

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), 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 to 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. 3) (the Amendment Rules) amend Schedule 5 of the Rules.  The purpose of the amendment is to ensure that two new facilities are eligible for second tier default benefits. The facilities are inserted into the table at clause 4 of Schedule 5 of the Rules, increasing the table from 303 facilities to 305 facilities.  No change has been made to the previously listed facilities.

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

Consultation

Consultation for changes to Schedule 5 occurred with industry through the Second Tier Advisory Committee (“STAC”), which includes equal representation from both the private hospital and private health insurance sectors.  Facilities wishing to be considered for inclusion in Schedule 5 are individually assessed by the STAC which then makes a recommendation to the Minister's Delegate as to whether or not the hospital meets the eligibility criteria.  This arrangement was negotiated with the private health industry and has been in place since Second Tier was first introduced in 2001. 

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

APRIL 2009

ATTACHMENT

DETAILS OF THE PRIVATE HEALTH INSURANCE (BENEFIT REQUIREMENTS) AMENDMENT RULES 2009 (No. 3)

1. Name of Rules

Rule 1 provides that the title of the Rules is the Private Health Insurance (Benefit Requirements) Amendment Rules 2009 (No. 3) (the Amendment Rules).

2. Commencement

Rule 2 provides that the Amendment Rules are to commence on 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 Private Health Insurance (Benefit Requirements) Rules 2008 (No. 2) (the Rules) which commenced on

1 July 2008 and was subsequently amended on 18 July 2008, 20 September 2008,

1 November 2008, 20 December 2008, 24 February 2009 and 20 March 2009.

Schedule – Amendments

Item 1 – Schedule 5, Clause 4

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 with which the health insurer does not have a negotiated agreement.  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 1 of the Schedule to the Amendment Rules amends clause 4 of Schedule 5 of the Rules to specify that two new facilities are entitled to second tier default benefits.

The new facilities are:

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

APRIL 2009