Private Health Insurance (Benefit Requirements) Amendment Rules 2012 (No. 9)

EXPLANATORY STATEMENT

Issued by the Authority of the Minister for Health

Private Health Insurance Act 2007

Private Health Insurance (Benefit Requirements) Amendment Rules 2012 (No. 9)

Authority

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) Amendment Rules 2012 (No. 9) (the Amendment Rules) consist of two Schedules (A and B), which amend Schedules 1, 3 and 5 of the Private Health Insurance (Benefit Requirements) Rules 2011 (the Principal Rules).

Purpose

Schedule A of the Amendments Rules

Schedule A of the Amendment Rules amends Schedules 1 and 3 of the Principal Rules. The purpose of the amendments to Schedules 1 and 3 of the Principal Rules is to remove duplication in the listing of four Medicare Benefit Schedule (MBS) item numbers (50100, 52144, 52300 and 52303).

Schedule B of the Amendment Rules

Schedule B of the Amendment Rules amends Schedule 5 Second-Tier default benefits.  The purpose of the amendments to Schedule 5 is to add seven new eligible facilities to the Principal Rules, increasing the number of private hospitals listed in Schedule 5 from 382 to 389. 

Background

The Principal Rules, which commenced on 1 November 2011, 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).

Schedule 1 of the Principal Rules categorises MBS item numbers into overnight patient classifications comprising ‘Advanced surgical patients’, ‘Obstetric patients’, ‘Surgical patients’, ‘Psychiatric patients’, ‘Rehabilitation patients’, and ‘Other patients’.  Schedule 3 sets out MBS item numbers for the same day hospital accommodation benefits which are payable to privately insured patients in all states and territories.

Schedule 5 of the Principal rules requires a health insurer to pay second-tier 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. 

Consultation

Schedule A of the Amendment Rules

Medical advice was sought from within the Department regarding these amendments.  The advice is that item 50100 does not normally require overnight treatment and items 52144, 52300 and 52303 usually do require an overnight stay.  No further consultation was undertaken because the amendments are minor in nature and do not significantly affect existing arrangements. 

Schedule B of the Amendment Rules

Consultation for changes to Schedule 5 occurred with industry through the Second Tier Advisory Committee (the Committee), which includes equal representation from both private hospital and private health insurance sectors.  Facilities wishing to be considered for inclusion in Schedule 5 are individually assessed by the Committee 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.

Details

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

The Amendment Rules commence on the day after registration.

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

ATTACHMENT

DETAILS OF THE PRIVATE HEALTH INSURANCE (BENEFIT REQUIREMENTS) AMENDMENT RULES 2012 (No. 9)

Section 1 Name of Rules

Section 1 provides that the title of the Rules is the Private Health Insurance (Benefit Requirements) Amendment Rules 2012 (No. 9) (the Amendment Rules).

Section 2 Commencement

Section 2 provides that the Amendment Rules are to commence on the day after registration.

Section 3 Amendment of Private Health Insurance (Benefit Requirements) Rules 2011

Section 3 provides that Schedules A and B to the Amendment Rules amend the Private Health Insurance (Benefit Requirements) Rules 2011 (the Principal Rules) which commenced on 1 November 2011.

Schedule A – Amendments

Item 1 – Schedule 1, Part 2 Type A procedures, Clause 6 Surgical Patient, subclause (3)

Item 1 removes Medicare Benefits Schedule (MBS) item 50100 as a Type A procedure.  This item continues to be listed under Schedule 3, Part 2 Type B procedures, Clause 5 Non-band specific Type B day procedures subclause (1).

Item 2 – Schedule 3, Part 2 Type B procedures, Clause 5 Non-band specific Type B day

procedure, subclause (1)

Item 2 removes MBS items 52144, 52300 and 52303 as Type B procedures.  These items continue to be listed under Schedule 1, Part 2 Type A procedures, Clause 6 Surgical Patient, subclause (3).

Schedule B – Amendments

Item 1 – Schedule 5, Clause 4 Facilities, Table

Item 1 provides that the table in Schedule 5, Clause 4 of the Principal Rules is amended to insert the following additional new facilities: