EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Health and Ageing
Private Health Insurance Act 2007
Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1)
Section 333-20 of the Private Health Insurance Act 2007 (the Act) provides that the Minister may make Private Health Insurance (Complying Product) Rules providing for matters required or permitted by Chapter 3 of the Act, or necessary or convenient in order to carry out or give effect to the Act.
The Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1) (the Amendment Rules) amend the Private Health Insurance (Complying Product) Rules 2010 (the Rules) which commenced on 30 January 2010.
The purpose of Rule 8A is to enforce the patient contribution for privately insured nursing-home type patients (NHTP) by restricting the amount of benefit that private health insurers pay for each day of NHTP hospital treatment at a hospital. The amount of benefit is restricted to the hospital’s charge less the patient contribution amount.
The Amendment Rules make minor changes to paragraph 8A(3)(a) of the Rules by amending the amounts for the NHTP patient contribution at public hospitals in NSW, South Australia, Tasmania and Victoria.
The Amendment Rules also amend the NHTP contribution at private hospitals provided for in paragraph 8A(3)(b) of the Rules.
Consultation
NSW Department of Health (NSW), Queensland Health (QLD), Department of Health (SA), Department of Health and Human Services (TAS) and the Department of Human Services (VIC) were consulted with regard to increasing the NHTP patient contribution for their jurisdictions. No objections were made.
No specific consultation was undertaken in relation to the amendment to paragraph 8A(3)(b) of the Rules regarding private hospitals because the changes were machinery in nature and did not substantially alter existing arrangements.
PRIVATE HEALTH INSURANCE BRANCH
DEPARTMENT OF HEALTH AND AGEING
MARCH 2010
ATTACHMENT
DETAILS OF THE PRIVATE HEALTH INSURANCE (COMPLYING PRODUCT) AMENDMENT RULES 2010 (No.1)
- Name of Rules
Rule 1 provides that the title of the Rules is the Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1) (the Amendment Rules).
2. Commencement
Rule 2 provides that the Amendment Rules are to commence on 20 March 2010, or if registered on a later date, the day after registration.
3. Amendment of Private Health Insurance (Complying Product) Rules 2010
Rule 3 provides that the Schedule to the Amendment Rules amends the Private Health Insurance (Complying Product) Rules 2010 which commenced on 30 January 2010.
Schedule – Amendments
Item 1 – Part 2, Paragraph 8A(3)(a)
Paragraph 8A(3)(a) of the Rules provides the patient contribution for privately insured NHTPs at a public hospital.
Item 1 of the Schedule of the Amendment Rules amends Part 2 subparagraph 8A(3)(a)(ii) to the Rules by increasing the NHTP patient contribution at public hospitals in New South Wales from $45.50 to $47.35. Item 1 further amends Part 2 subparagraph 8A(3)(a)(iv) to subparagraph 8A(3)(a)(vii) of the Rules by increasing the NHTP patient contribution at public hospitals in Queensland, South Australia, Tasmania and Victoria from $45.50 to $47.35. This increase reflects the indexation applied to Adult Pension Basic Rate and the maximum daily rate of rental assistance that will commence on 20 March 2010.
Item 2 – Part 2, Paragraph 8A(3)(b)
Paragraph 8A(3)(b) of the Rules provides the patient contribution for privately insured NHTPs at private hospitals.
Item 2 of the Schedule of the Amendment Rules amends Part 2 subparagraph 8A(3)(b) of the Rules by increasing the NHTP patient contribution at private hospitals from $45.50 to $47.35. This increase reflects the indexation applied to Adult Pension Basic Rate and the maximum daily rate of rental assistance that will commence on 20 March 2010.
PRIVATE HEALTH INSURANCE BRANCH
DEPARTMENT OF HEALTH AND AGEING
MARCH 2010
Overview
The Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1) were enacted to amend the Private Health Insurance (Complying Product) Rules 2010, which had commenced on 30 January 2010. These amendment rules were issued under the authority of the Minister for Health and Ageing and were designed to address the need for updating the patient contribution amounts for privately insured nursing-home type patients (NHTP) at both public and private hospitals. The rules specifically adjust the amounts to reflect the indexation applied to the Adult Pension Basic Rate and the maximum daily rate of rental assistance, which were set to commence on 20 March 2010. This adjustment was made in alignment with the policy objective of ensuring that the patient contributions are kept current with changes in economic indicators.
Consultation with relevant health departments in New South Wales, Queensland, South Australia, Tasmania, and Victoria took place regarding the proposed changes to the NHTP patient contribution at public hospitals, with no objections raised. No specific consultation was undertaken for the amendments to private hospitals, as the changes were considered to be of a procedural nature and did not significantly alter existing arrangements. The purpose of these amendments was to enforce the patient contribution for NHTPs by restricting the benefits paid by private health insurers for each day of NHTP hospital treatment at a hospital to the hospital's charge less the patient contribution amount.
Scope and Application
The Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1) apply to the enforcement of patient contributions for privately insured nursing-home type patients (NHTP) in relation to hospital treatment at both public and private hospitals. These rules amend the Private Health Insurance (Complying Product) Rules 2010, which commenced on 30 January 2010, by adjusting the patient contribution amounts for NHTPs in certain states. Specifically, the Amendment Rules increase the NHTP patient contribution at public hospitals in New South Wales, South Australia, Tasmania, and Victoria from $45.50 to $47.35, and similarly increase the contribution for private hospitals from $45.50 to $47.35. These changes were made in response to indexation adjustments applied to the Adult Pension Basic Rate and the maximum daily rate of rental assistance. The Amendment Rules came into effect on 20 March 2010 or, if registered later, the day after registration.
Key Provisions
The main provisions of the Private Health Insurance (Complying Product) Amendment Rules 2010 (No. 1) relate to changes in patient contribution amounts for privately insured nursing-home type patients (NHTP) receiving treatment in public and private hospitals. Rule 8A, as amended, specifies the patient contribution for NHTPs in both public and private hospitals (Rule 8A(3)(a) and Rule 8A(3)(b)). The amendment increases the NHTP patient contribution at public hospitals in New South Wales, Queensland, South Australia, Tasmania, and Victoria from $45.50 to $47.35 per day. Similarly, the contribution for private hospitals is also increased from $45.50 to $47.35 per day. These amendments are effective from 20 March 2010.
The obligations imposed by these Amendment Rules primarily involve ensuring that private health insurers adjust their payment structures to reflect the new patient contribution amounts. Insurers must ensure that the benefits they provide for NHTPs are aligned with the updated rates specified in Rule 8A(3). This includes updating their policies and communications to reflect the new contributions, thereby ensuring compliance with the Act’s requirements.
Failure to comply with the new patient contribution rates specified in Rule 8A can result in significant consequences. While the Explanatory Statement does not detail specific penalties, breaches of the Private Health Insurance Act 2007 can generally lead to enforcement actions by the Australian Prudential Regulation Authority (APRA) or the Australian Health Practitioner Regulation Agency (AHPRA). These may include financial penalties, corrective orders, or other regulatory actions. Additionally, insurers found to be in breach of the Act may face reputational damage and potential legal action from affected policyholders. It is important to note that the exact penalties can vary depending on the nature and severity of the breach.