Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5)

Administered by Department of Health, Disability and Ageing

Legislation au F2018L01316 Rules Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Issued by the Authority of the Minister for Health

 

Private Health Insurance Act 2007

 

Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5)

 

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 2018 (No. 5)
(the Amendment Rules) amend Section 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 Section 8A is to update the patient contribution payable per night for nursing-home type patients (NHTP) at public hospitals in each State and Territory and at private hospitals nationally.

 

Background

Section 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.

 

Schedule 1 to the Amendment Rules makes minor changes to the definition of ‘patient contribution’ in subsection 8A(3) of the Principal Rules by updating the NHTP contribution rate at public hospitals in each State and Territory and private hospitals nationally. Changes to the NHTP contribution rate reflect the indexation applied to the Adult Pension Basic Rate and the Maximum Daily Rate of Rental Assistance (Pension and Rental Assistance Rates), which took effect on 20 September 2018.

 

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

 

Consultation

On 23 August 2018, States and Territories were asked whether they would increase the NHTP contribution rates in their jurisdiction in line with increases in the Pension and Rental Assistance Rates which take effect on 20 September 2018. 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 2018 to $60.65. The Australian Capital Territory and the Northern Territory have advised that they are not increasing their NHTP contribution rates at this time.

 

The Amendment Rules commence on 20 September 2018.

 

The Amendment Rules are a legislative instrument for the purposes of the Legislation Act 2003.

ATTACHMENT

 

DETAILS OF THE PRIVATE HEALTH INSURANCE (COMPLYING PRODUCT) AMENDMENT RULES 2018 (No. 5)

 

Section 1 Name

Section 1 provides that the title of the Rules is the Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5) (the Amendment Rules).

Section 2 Commencement

Section 2 provides that the Amendment Rules are to commence on 20 September 2018.

Section 3 Authority

Section 3 provides that the Amendment Rules are made under item 3 of the table in section 333-20 of the Private Health Insurance Act 2007.

Section 4 Schedules

Section 4 provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

 

Schedule 1–Amendments

Item 1 – Subsection 8A(3) (paragraph (a) of the definition of patient contribution)

Subsection 8A(3) of the Principal Rules sets out the patient contribution for privately insured nursing-home type patients (NHTPs) at public hospitals.

 

Item 1 of Schedule 1 to the Amendment Rules provides that paragraph (a) of the definition of patient contribution in the Principal Rules is amended by updating the NHTP contribution at public hospitals in all States but not the Australian Capital Territory or the Northern Territory.  

 

Item 2 – Subsection 8A(3) (paragraph (b) of the definition of patient contribution)

 

Subsection 8A(3) of the Principal Rules sets out the patient contribution for privately insured NHTPs at private hospitals.

 

Item 2 of Schedule 1 of the Amendment Rules provides that paragraph (b) of the definition of patient contribution in the Principal Rules is amended by updating the NHTP contribution at private hospitals in Australia to $60.65.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overview

The Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5) were enacted under section 333-20 of the Private Health Insurance Act 2007 to address the need for updating the patient contribution rates for nursing-home type patients (NHTPs) in both public and private hospitals across Australia. These amendments were introduced in response to changes in the Pension and Rental Assistance Rates, which took effect on 20 September 2018. The primary objective of these rules is to ensure that the patient contribution for NHTPs is adjusted in line with these updated rates, thereby maintaining consistency and fairness in the benefits provided under private health insurance policies. The rules were developed following consultations with various states and territories, and they came into effect on the same date as the changes to the Pension and Rental Assistance Rates.

Scope and Application

The Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5) amends the patient contribution rates payable by nursing-home type patients (NHTP) for private health insurance coverage of hospital treatment in Australia. The Amendment Rules, made under Section 333-20 of the Private Health Insurance Act 2007, adjust the patient contribution rates in accordance with the updated indexation of the Adult Pension Basic Rate and Maximum Daily Rate of Rental Assistance, effective from 20 September 2018. The changes apply to NHTPs at public hospitals in all states except the Australian Capital Territory and Northern Territory, and at private hospitals nationally. These amendments ensure the patient contribution amounts are in line with the new rates, reflecting the legislative intent to maintain equitable and updated standards in private health insurance contributions. The Amendment Rules are applicable across the Commonwealth and will directly affect private health insurers and their insured clients who require hospital treatment for nursing-home type patients.

Key Provisions

The main operative sections of the Private Health Insurance (Complying Product) Amendment Rules 2018 (No. 5) are primarily concerned with updating the patient contribution rates for nursing-home type patients (NHTP) receiving treatment at public and private hospitals. These amendments are made to Section 8A of the Private Health Insurance (Complying Product) Rules 2015, as referenced in Schedule 1 of the Amendment Rules. Specifically, the changes affect the definition of 'patient contribution' under subsection 8A(3), updating the rates for NHTPs at public hospitals in various states and at private hospitals nationally, as outlined in Items 1 and 2 of Schedule 1. The obligations and requirements imposed by these rules on private health insurers and hospitals are primarily focused on adherence to the updated patient contribution rates. Private health insurers must ensure that their benefit payments for NHTPs align with the new rates, which means paying the specified patient contributions per night for treatment at public hospitals in certain states and at private hospitals across Australia. Hospitals, in turn, must comply with the updated rates when billing private health insurers for services provided to NHTPs. These rules mandate that the patient contribution amount is deducted from the hospital's charge before the private health insurer pays the benefit. In terms of offences, penalties, or civil/criminal consequences for breach, the Amendment Rules do not explicitly state penalties. However, under the Private Health Insurance Act 2007, failure to comply with the rules governing private health insurance products and benefits can lead to significant consequences. Such breaches may result in penalties imposed by the Australian Prudential Regulation Authority (APRA) or the Australian Competition and Consumer Commission (ACCC), which could include fines and other regulatory actions. Additionally, private health insurers found to be non-compliant could face legal action from policyholders, potentially leading to substantial financial liabilities. Therefore, adherence to the updated patient contribution rates is crucial to avoid any regulatory or legal repercussions.

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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.