EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Health
Private Health Insurance Act 2007
Private Health Insurance (Complying Product) Amendment Rules 2013 (No. 4)
Authority
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 and/or section 188-1 of the Act, or necessary or convenient in order to carry out or give effect to Chapter 3 and/or section 188-1 of the Act.
The Private Health Insurance (Complying Product) Amendment Rules 2013 (No. 4) (the Amendment Rules) amend Rule 8A of the Private Health Insurance (Complying Product) Rules 2010 (No. 2) (the Principal Rules) which commenced on 14 January 2011.
Purpose
The purpose of the amendments to Rule 8A is to change the patient contribution payable per night for nursing-home type patients (NHTPs) in Western Australian public hospitals.
In the Private Health Insurance (Complying Product) Amendment Rules 2013 (No. 3) which took effect on 20 September 2013, the Western Australian NHTP contribution rate was set at $53.25 per day. It has subsequently been brought to the Department of Health’s attention that this figure is not correct and the correct rate is $54.75 per day.
The Amendment Rules have been made to remedy this.
It is not expected that any individual has been disadvantaged by this drafting error. Effectively the setting of the NHTP contribution imposes a maximum benefit that insurers can pay for NHTP hospital accommodation. Under subclause 8A(2) of the Principal Rules, insurers cannot pay a benefit for a NHTP that exceeds an amount equal to the fees or charges incurred in respect of NHTP accommodation less the amount of the NHTP contribution in respect of each day of accommodation. Western Australian NHTPs should already be incurring a patient contribution of $54.75 as this amount is equal to the amount charged by Western Australian public hospitals less than the minimum benefit that private health insurers pay.
Background
Rule 8A of the Principal Rules sets the patient contribution for privately insured NHTPs 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 Schedule to the Amendment Rules changes the Western Australian patient contribution amount and is now in line with NHTP patient contribution amounts in New South Wales, Queensland, South Australia, Tasmania and Victoria. Changes to the NHTP contribution rate reflect increases in the Adult Pension Basic Rate and the Maximum Daily Rate of Rental Assistance (Pension and Rental Assistance Rates), which took effect on 20 September 2013.
Details
Details of the Amendment Rules are set out in the Attachment.
Consultation
No consultation was undertaken with respect to this amendment as it relates only to an inadvertent drafting error.
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.
Authority: Section 333-20 of the
Private Health Insurance Act 2007
MEDICAL BENEFITS DIVISION
DEPARTMENT OF HEALTH
SEPTEMBER 2013
ATTACHMENT
DETAILS OF THE PRIVATE HEALTH INSURANCE (COMPLYING PRODUCT) AMENDMENT RULES 2013 (No. 4)
Section 1 Name of Rules
Section 1 provides that the title of the Rules is the Private Health Insurance (Complying Product) Amendment Rules 2013 (No. 4) (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 (Complying Product) Rules 2010 (No. 2)
Section 3 provides that the Schedule to the Amendment Rules amends the Private Health Insurance (Complying Product) Rules 2010 (No. 2) (the Principal Rules) which commenced on 14 January 2011.
Schedule – Amendments
Item 1 – Part 2, Paragraph 8A(3)(a)
Paragraph 8A(3)(a) of the Principal Rules set out the patient contribution for privately insured NHTPs at public hospitals in Western Australia.
Item 1 of the Schedule of the Amendment Rules amends Part 2, Paragraph 8A(3)(a)(viii) of the Principal Rules by increasing the NHTP contribution at Western Australian public hospitals from $53.25 to $54.75.