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. 5)
Authority
Section 333-20 of the Private Health Insurance Act 2007 (the Act) provides that the Minister, or his delegate, may make Private Health Insurance (Complying Product) Rules providing for matters required or permitted by Chapter 3 and section 188-1 of the Act, or necessary or convenient to be provided in order to carry out or give effect to Chapter 3 and section 188-1 of the Act.
The Private Health Insurance (Complying Product) Amendment Rules 2013 (No. 5) (the Amendment Rules) amends Part 2 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 Part 2 of the Principal Rules is to create new product subgroups so that, from 1 April 2014, the weighted average ratio as defined in subsection 22‑50(5) of the Act is applied to every complying health insurance policy.
Background
The Principal Rules, which commenced on 14 January 2011, provide some of the requirements that complying health insurance products must comply with. These requirements include:
- Products to be community-rated, that is, made available in a way that does not discriminate between people;
- Products be in the form of a complying health insurance product; and
- Private health insurers who make the products available must meet certain obligations to people insured or seeking to be insured under the products.
Part 2 of the Principal Rules specifies insured groups for the purposes of a product subgroup under section 63-5(2A)(b) of the Act.
The Amendment Rules create no additional obligations for private health insurers. This amendment simplifies the application of the Rebate.
Details
Details of the Amendment Rules are set out in the Attachment.
Consultation
The Office of Best Practice Regulation (OBPR) was consulted in relation to the Amendment Rules. OBPR has advised that no regulatory impact statement is required for the Amendment Rules as the changes are minor in nature. Consultation with the private health insurance industry was conducted on the intent behind this amendment. Consultation occurred with key stakeholders and insurer representatives, which was reasonably practicable to undertake.
The Amendment Rules commence on 1 April 2014.
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
RICHARD BARTLETT
MEDICAL BENEFITS DIVISION
DEPARTMENT OF HEALTH
DECEMBER 2013
ATTACHMENT
DETAILS OF THE PRIVATE HEALTH INSURANCE (COMPLYING PRODUCT) AMENDMENT RULES 2013 (No. 5)
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. 5) (the Amendment Rules).
Section 2 Commencement
Section 2 provides that the Amendment Rules are to commence on 1 April 2014.
Section 3 Amendment of the Private Health Insurance (Complying Product) Rules 2010 (No. 2)
Section 3 provides that the Schedule to these Amendment Rules amends the Private Health Insurance (Complying Product) Rules 2010 (No. 2) as amended.
Schedule – Amendments
Item 1 – Part 2 General, Paragraph 5 Insured Groups
Item 1 deletes and substitutes paragraph 5 to create new product subgroups for the purposes of section 63-5 of the Act.
Paragraphs 5(1)(a), (b), and (c) create new product subgroups for adult, non-student and
non-student dependent child policies that were purchased on or before 1 April 2013.
Paragraphs 5(1)(d), (e), and (f) create new product subgroups for adult, non-student and
non-student dependent child policies that were purchased after 1 April 2013.
Subsection 5(2) defines non-student policy as a complying health insurance policy that covers one or more dependent child non-students.