EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Health
Private Health Insurance Act 2007
Private Health Insurance (Complying Product) Amendment Rules 2016 (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 2016 (No. 4)
(the Amendment Rules) amend Rule 8A of the Private Health Insurance (Complying Product) Rules 2015 (the Principal Rules) which commenced on 1 July 2015.
Purpose
The purpose of the amendments to Rule 8A is to change the patient contribution payable per night for nursing-home type patients (NHTP) at public hospitals in each State and Territory.
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 makes minor changes to Paragraph 8A(3) of the Principal Rules by amending the NHTP contribution rate at public hospitals in each State and Territory. 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 2016.
Details
Details of the Amendment Rules are set out in the Attachment.
Consultation
On 29 August 2016, States and Territories were asked whether they would be increasing the NHTP contribution and accommodation rates in their jurisdiction in line with increases in the Pension and Rental Assistance Rates. New South Wales, Queensland, South Australia, Tasmania, Victoria, and Western Australia have advised that they will increase the NHTP contribution rates in their public hospitals from 20 September 2016. The Australian Capital Territory and the Northern Territory have advised that they will not be increasing the NHTP contribution rates in their public hospitals at this time.
The Amendment Rules commence on 20 September 2016.
The Amendment Rules are a legislative instrument for the purposes of the Legislation Act 2003.
Authority: Section 333-20 of the
Private Health Insurance Act 2007
MEDICAL BENEFITS DIVISION
DEPARTMENT OF HEALTH
SEPTEMBER 2016
ATTACHMENT
DETAILS OF THE PRIVATE HEALTH INSURANCE (COMPLYING PRODUCT) AMENDMENT RULES 2016 (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 2016 (No. 4) (the Amendment Rules).
Section 2 Commencement
Section 2 provides that the Amendment Rules are to commence on 20 September 2016.
Section 3 Amendment of Private Health Insurance (Complying Product) Rules 2015
Section 3 provides that the Schedule to the Amendment Rules amends the Private Health Insurance (Complying Product) Rules 2015 (the Principal Rules) which commenced on
1 July 2015.
Schedule – Amendments
Item 1 – Part 2, Paragraph 8A(3)
Paragraph 8A(3) of the Principal Rules set out the patient contribution for privately insured NHTPs at public hospitals.
Item 1 of the Schedule of the Amendment Rules amends Part 2, Paragraph 8A(3) of the Principal Rules by increasing the NHTP contribution at public hospitals in New South Wales, Queensland, South Australia, Tasmania, Victoria, and Western Australia.
Overview
The Private Health Insurance (Complying Product) Amendment Rules 2016 (No. 4) were enacted under Section 333-20 of the Private Health Insurance Act 2007. These rules were introduced to address the need for updating patient contribution rates for nursing-home type patients (NHTP) in public hospitals across various states and territories, aligning with recent increases in the Adult Pension Basic Rate and the Maximum Daily Rate of Rental Assistance (Pension and Rental Assistance Rates). The rules were issued by the Minister for Health and aim to ensure that the patient contributions for NHTPs remain consistent with the prevailing economic conditions.
The amendment rules specifically modify Rule 8A of the Private Health Insurance (Complying Product) Rules 2015, which was established to regulate the patient contributions for NHTPs. The changes made in the Amendment Rules reflect the increases in the NHTP contribution rates in New South Wales, Queensland, South Australia, Tasmania, Victoria, and Western Australia, effective from 20 September 2016. Conversely, the Australian Capital Territory and the Northern Territory have opted not to adjust their NHTP contribution rates at this time. This adjustment is intended to maintain fairness and accuracy in the financial contributions expected from privately insured patients receiving treatment in public hospitals.
Scope and Application
The Private Health Insurance (Complying Product) Amendment Rules 2016 (No. 4) amends Rule 8A of the Private Health Insurance (Complying Product) Rules 2015 to adjust the patient contribution rates for nursing-home type patients (NHTP) at public hospitals in certain states and territories. This amendment applies to private health insurers and insured individuals receiving treatment as NHTPs in public hospitals within New South Wales, Queensland, South Australia, Tasmania, Victoria, and Western Australia, where the NHTP contribution rates are set to increase in line with the Adult Pension Basic Rate and the Maximum Daily Rate of Rental Assistance. These amendments, which reflect changes effective from 20 September 2016, are intended to align the contributions with updated pension and rental assistance rates. The Amendment Rules are legislative instruments under the Legislation Act 2003 and are authorised by Section 333-20 of the Private Health Insurance Act 2007. They do not apply to the Australian Capital Territory and the Northern Territory, where the NHTP contribution rates remain unchanged.
Key Provisions
The Private Health Insurance (Complying Product) Amendment Rules 2016 (No. 4) amend Rule 8A of the Private Health Insurance (Complying Product) Rules 2015. These rules set out the patient contributions for nursing-home type patients (NHTP) at public hospitals, particularly in relation to the amount of benefit that private health insurers pay for each day of hospital treatment (Rule 8A(3)). The Amendment Rules modify the contribution rates in response to increases in the Adult Pension Basic Rate and the Maximum Daily Rate of Rental Assistance, effective from 20 September 2016.
The Amendment Rules impose specific obligations on private health insurers, requiring them to adjust their payments according to the new patient contribution rates set out in the rules. Insurers must ensure that the amount of benefit paid for each day of NHTP hospital treatment at public hospitals in the affected states and territories adheres to the revised contribution rates. This adjustment is necessary to comply with the legislative requirements and to ensure that the benefits provided to patients align with the updated rates.
Failure to comply with the provisions of these Amendment Rules may result in legal consequences for private health insurers. Although the document does not explicitly detail specific offences or penalties for non-compliance, breaches of rules under the Private Health Insurance Act 2007 can generally lead to various civil and criminal consequences. In severe cases, penalties may include substantial fines and other legal actions as deemed necessary by the relevant authorities. Insurers are expected to adhere strictly to the amended rules to avoid any potential legal repercussions.