Private Health Insurance (Benefit Requirements) Amendment Rules 2011 (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 2011 (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 2010 (the Principal Rules), which commenced on 29 January 2010, provide for the minimum benefit requirements for psychiatric, rehabilitation and palliative care and other hospital treatment.  Schedules 1 to 5 of the Principal 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 2011 (No. 2) (the Amendment Rules) amends Schedules 4 and 5 of the Principal Rules.

The purpose of the amendments to Schedule 4 of the Principal Rules is to change the minimum benefits payable per night for nursing-home type patients at public hospitals in some States and at private hospitals nationally.  These changes reflect the indexation applied to the Adult Pension Basic Rate and the maximum daily rate of rental assistance, which become effective on 20 March 2011.

The purpose of the amendments to Schedule 5 of the Principal Rules is to add eight additional facilities that are eligible for second tier default benefits and to update the name or address of 12 facilities in the table.  These changes have increased the table of listed facilities from 351 to 359.

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

Consultation

The NSW Department of Health (NSW), Department of Health and Human Services (TAS) and Victorian Department of Human Services (VIC) were consulted with regard to increasing the minimum benefits payable for nursing-home type patients in their jurisdictions.  No objections were made.

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 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 2004.

The Amendment Rules commence on 20 March 2011 or, if registered after 20 March 2011, the day after registration.

The Amendment Rules are a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Authority: Section 333-20 of the

Private Health Insurance Act 2007

ATTACHMENT

DETAILS OF THE PRIVATE HEALTH INSURANCE (BENEFIT REQUIREMENTS) AMENDMENT RULES 2011 (No. 2)

1. Name of Rules

Rule 1 provides that the title of the Rules is the Private Health Insurance (Benefit Requirements) Amendment Rules 2011 (No. 2) (the Amendment Rules).

2. Commencement

Rule 2 provides that the Amendment Rules are to commence on 20 March 2011 or, if registered on a later date, the day after registration.

3.              Amendment of Private Health Insurance (Benefit Requirements) Rules 2010

Rule 3 provides that the Schedule to the Amendment Rules amends the Private Health Insurance (Benefit Requirements) Rules 2010 (the Principal Rules) which commenced on 29 January 2010.

Schedule – Amendments

Item 1 – Schedule 4, Clause 6 Minimum benefit, Table 1

Schedule 4 of the Principal Rules set out the minimum benefits payable per night for nursing-home type patients in public hospitals.

Item 1 of the Schedule to the Amendment Rules increases the minimum benefit payable per night for nursing-home type patients in public hospitals in the following States in clause 6, Table 1:

• New South Wales  From: $103.25 to $104.90
• Tasmania From: $116.05 to $118.05
• Victoria From: $103.65 to $105.65

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

Schedule 4 of the Principal Rules set out the minimum benefits payable per night for nursing-home type patients in private hospitals. 

Item 2 of the Schedule to the Amendment Rules decreases the minimum benefit payable per night for nursing-home type patients in private hospitals in clause 6, Table 2:

• Private hospitals  From: $62.75 to $61.90

Item 3 – Schedule 5, Clause 4 Facilities, Table

Schedule 5 of the Principal 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 Principal Rules.

Item 3 provides that the table in Schedule 5, Clause 4 of the Principal Rules is amended to insert the following eight new facilities:

Item 3 provides that the table in Schedule 5, Clause 4 of the Principal Rules is amended to change the name or address of the following 12 facilities:

PRIVATE HEALTH INSURANCE BRANCH

DEPARTMENT OF HEALTH AND AGEING

MARCH 2011