Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7)

Administered by Department of Health, Disability and Ageing

Legislation au F2013L02113 Rules Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

Issued by the Authority of the Minister for Health

 

Private Health Insurance Act 2007

 

Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7)

 

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 2013 (No. 7) (the Amendment Rules) amend Schedule 5 of the Private Health Insurance (Benefit Requirements) Rules 2011 (the Principal Rules) which commenced on 1 November 2011.

 

Purpose

The purpose of the amendment to Schedule 5 of the Principal Rules is to update the reference to the new Second Tier Advisory Committee (the Committee) approved list of facilities that are eligible for second-tier default benefits.

 

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 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.

 

Details

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

 

Consultation
Consultation for changes to Schedule 5 occurred with industry through the Committee, which includes representation from both private hospital and private health insurance sectors.  Facilities wishing to be considered for inclusion in Schedule 5 were individually assessed and decided by the Committee. 

 

The Amendment Rules commence on 1 January 2014 or, if registered after 1 January 2014, 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

 

 

MEDICAL BENEFITS DIVISION

DEPARTMENT OF HEALTH

DECEMBER 2013


ATTACHMENT

 

DETAILS OF THE PRIVATE HEALTH INSURANCE (BENEFIT REQUIREMENTS) AMENDMENT RULES 2013 (No. 7)

 

Section 1 Name of Rules

Section 1 provides that the title of the Rules is the Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) (the Amendment Rules).

 

Section 2 Commencement

Section 2 provides that the Amendment Rules are to commence on 1 January 2014 or, if registered on a later date, the day after registration.

 

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

Section 3 provides that the Schedule to this instrument amends the Private Health Insurance (Benefit Requirements) Rules 2011 as amended. 

 

Schedule

The Schedule provides that the Amendment Rules amend Schedule 5 of the Private Health Insurance (Benefit Requirements) Rules 2011 (the Principal Rules) which commenced on 1 November 2011.

 

Schedule – Amendments

Item 1 – Schedule 5 – Second-tier default benefits, Clause 4 - Facilities, subclause (1)  

 

Item 1 of the Schedule to the Amendment Rules updates the reference to the latest Second Tier Advisory Committee-approved list. A hospital is a facility for the purposes of this Schedule if it is included in the list of second-tier eligible facilities approved by the Second Tier Advisory Committee existing at the time that the Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) commence. 

 


Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7)

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

 

The Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) amends
Schedule 5 of the Private Health Insurance (Benefit Requirements) Rules 2011 to update the reference to the latest Second Tier Advisory Committee-approved list.

Human rights implications

This legislative instrument engages Articles 2 and 12 of the International Covenant on Economic, Social and Cultural Rights by assisting with the progressive realisation by all appropriate means of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health.

 

Private health insurance regulation assists with the advancement of these human rights by improving the governing framework for private health insurance in the interests of consumers.  Private health insurance regulation aims to encourage insurers and providers of private health goods and services to provide better value for money to consumers, improve information provided to consumers of private health services, and to allow consumers to make informed choices when purchasing services. Private health insurance regulation also restricts insurers from differentiating the premiums they charge according to individual health characteristics such as poor health. 

 

Conclusion

This legislative instrument is compatible with human rights because it advances the protection of human rights.

 

Richard Bartlett

First Assistant Secretary

Medical Benefits Division

Department of Health

Overview

The Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) was introduced to amend Schedule 5 of the Private Health Insurance (Benefit Requirements) Rules 2011, which sets the minimum benefit requirements for hospital treatment. Enacted by the Australian Parliament, these rules were authorised under section 333-20 of the Private Health Insurance Act 2007 and aim to update the reference to the latest Second Tier Advisory Committee-approved list of facilities eligible for second-tier default benefits. This amendment ensures that health insurers pay higher minimum levels of benefits for hospital treatment provided in private hospital facilities that are specified in Schedule 5 if they do not have a negotiated agreement with the hospital. The policy objective behind these rules is to progressively realise the right to the highest attainable standard of physical and mental health by improving the regulatory framework for private health insurance, encouraging insurers to provide better value for money and improve consumer information, ultimately allowing consumers to make informed choices.

Scope and Application

The Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) amends the Private Health Insurance (Benefit Requirements) Rules 2011 to update the list of eligible facilities for second-tier default benefits under the Private Health Insurance Act 2007. These Amendment Rules apply to all health insurers operating within Australia, ensuring that they adhere to the updated standards set by the Second Tier Advisory Committee for second-tier default benefits. This legislative instrument is significant in regulating the private health insurance industry by specifying the minimum levels of benefit that insurers must pay for hospital treatment in private facilities that are not covered by negotiated agreements. The rules apply nationally, as they are intended to standardise the benefit requirements across all states and territories in Australia. However, the Amendment Rules do not explicitly state any exclusions or thresholds, but rather focus on updating the list of facilities that qualify for higher minimum benefit levels under Schedule 5. The amendment rules came into effect on 1 January 2014, and any subsequent registration will take effect the day after registration.

Key Provisions

The Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) primarily amend Schedule 5 of the Private Health Insurance (Benefit Requirements) Rules 2011, which sets out the minimum levels of benefit for second-tier default benefits in private hospital facilities. These amendments are necessary to update the reference to the latest Second Tier Advisory Committee-approved list of facilities eligible for second-tier default benefits. Under Section 3 of the Amendment Rules, the Schedule modifies Schedule 5 to reflect the most current list of facilities approved by the Second Tier Advisory Committee as of the commencement date of these Amendment Rules. Health insurers governed by these rules must ensure compliance with the updated Schedule 5, which dictates that they must pay second-tier default benefits for most episodes of hospital treatment in facilities listed on the approved list, provided there is no negotiated agreement between the insurer and the hospital. This requirement is crucial for ensuring that patients receive a minimum level of benefits for overnight and day-only treatments in specified facilities. Health insurers must review their agreements and payment structures to align with these updated requirements, ensuring they are not providing less than the stipulated minimum benefits. Breach of these provisions can lead to several consequences. While the Amendment Rules themselves do not explicitly outline specific penalties for non-compliance, failure to adhere to the minimum benefit requirements could result in civil liabilities for the health insurer, potentially including compensation claims from policyholders. Additionally, ongoing non-compliance could lead to regulatory scrutiny and enforcement actions by the Australian Prudential Regulation Authority (APRA) or other relevant regulatory bodies. Such actions might include fines, corrective measures, or other administrative penalties aimed at ensuring compliance with the Private Health Insurance Act 2007. In summary, the Private Health Insurance (Benefit Requirements) Amendment Rules 2013 (No. 7) serve to update the list of facilities eligible for second-tier default benefits, ensuring that health insurers provide adequate minimum benefits as per the updated Schedule 5. Compliance with these rules is mandatory for health insurers, and failure to do so can result in significant civil and regulatory consequences.

Legal classification tags

Area of Law
Health Law
Instrument
Regulation
Concepts
Reporting & Disclosure Obligations
Licensing & Registration
Regulatory Standards

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.