Private Health Insurance Legislation Amendment Rules (No. 2) 2020

Administered by Department of Health, Disability and Ageing

Legislation au F2020L00272 Rules Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

Issued by the Authority of the Minister for Health

 

Private Health Insurance Act 2007

 

Private Health Insurance Legislation Amendment Rules (No.2) 2020

 

Authority

Section 333-20(1) of the Private Health Insurance Act 2007 (the Act) authorises the Minister to, by legislative instrument, make specified Private Health Insurance Rules providing for matters required or permitted by the corresponding Chapter, Part or section to be provided; or necessary or convenient to be provided in order to carry out or give effect to that Chapter, Part or section.

 

The Private Health Insurance Legislation Amendment Rules (No.2) 2020 (the Amendment Rules) amends the Private Health Insurance (Benefit Requirements) Rules 2011 (the Benefit Requirements Rules) and the Private Health Insurance (Complying Product) Rules 2015 (the Complying Product Rules).

 

Under subsection 33(3) of the Acts Interpretation Act 1901, where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations or by-laws), the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.

 

Purpose

The purpose of the Amendment Rules is to make consequential amendments to the Benefit Requirement Rules and the Complying Product Rules to reflect indexation and adjustments applicable to Pension and Rent Assistance Rates from 20 March 2020. This is achieved by:

 

  • amending Schedule 4 of the Benefit Requirements Rules (at clause 6, table 1) to change the minimum benefits payable by private health insurers per night for privately insured nursing-home type patients (NHTPs) accommodated in private hospitals nationally, or public hospitals in some jurisdictions.

 

  • amending Section 8A of the Complying Product Rules to change the daily patient contribution payable by NHTPs towards the costs of their accommodation at private hospitals nationally, or at public hospitals in some jurisdictions.

 

Background

The Benefit Requirements Rules provide for the minimum benefit requirements for psychiatric care, rehabilitation, palliative care and other hospital treatments. Schedules 1 to 5 of the Benefit Requirements Rules also set out the minimum levels of accommodation benefits which are payable by private health insurers for hospital treatment. Namely, benefits for overnight accommodation (Schedules 1 and 2), same day accommodation (Schedule 3), NHTPs (Schedule 4) and second-tier default benefits (Schedule 5).

 

Schedule 4 of the Benefit Requirements Rules (at clause 2) classifies a patient remaining in hospital after a continuous 35-day period, and receiving accommodation and nursing care as an end in itself, as a NHTP.

 

The Complying Product Rules Section 8A sets the patient contribution for privately insured NHTPs at public and private hospitals. It also restricts the amount of benefit that private health insurers pay for each day of NHTP hospital treatment at a hospital to the hospital’s charge less the patient contribution amount.

 

The Amendment Rules makes minor changes to the definition of patient contribution in subsection 8A(3) of the Complying Product Rules by updating the NHTP contribution rate for privately insured patients at public hospitals for each state and territory except the Australian Capital Territory, and by updating the NHTP contribution rate for privately insured patients at private hospitals nationally.

 

The Commonwealth reviews NHTP accommodation and contribution rates twice annually, in line with adjustments and indexation applied to the Commonwealth Adult Pension Basic Rate and Maximum Daily Rate of Rental Assistance (Pension and Rental Assistance Rates). Changes in the Amendment Rules reflect the indexation applied to the Pension and Rental Assistance Rates, effective 20 March 2020.

 

The amendments in the Amendment Rules are administrative in nature and do not substantively alter existing arrangements.

 

Commencement

The Amendment Rules commence on 20 March 2020.

 

Details

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

 

Consultation

On 7 February 2020, the Australian Government asked the states and territories whether they would increase the NHTP contribution and accommodation rates in their jurisdiction in line with adjustments in the Pension and Rental Assistance Rates applicable from 20 March 2020.

 

New South Wales, the Northern Territory and Tasmania advised they intend to increase their minimum accommodation benefit payable by private health insurers for private NHTPs in their public hospitals, effective 20 March 2020.

 

The, Australian Capital Territory, Queensland, South Australia, Victoria and Western Australia will not change the minimum accommodation benefit payable by private health insurers, at this time.

 

All states and territories except the Australian Capital Territory advised that they will increase the NHTP contribution rates in their public hospitals from 20 March 2020 to $62.50. The Australian Capital Territory advised that it is not increasing its NHTP contribution rate at this time.

 

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


ATTACHMENT

 

DETAILS OF THE PRIVATE HEALTH INSURANCE LEGISLATION AMENDMENT (No. 2) RULES 2020

 

Section 1 Name

 

Section 1 provides that the name of the instrument is the Private Health Insurance Legislation Amendment Rules (No. 2) 2020 (the Amendment Rules).

 

Section 2 Commencement

 

Section 2 provides that the instrument commences on 20 March 2020.

 

Section 3 Authority

 

Section 3 provides that the Amendment Rules are made under 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 the instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to the instrument has effect according to its terms.

 

Schedule 1Amendments – Nursing-home type patient minimum accommodation benefit

 

Private Health Insurance (Benefit Requirements) Rules 2011

 

Item 1 Clause 6 of Schedule 4 (Table 1, table item dealing with New South Wales, column headed “Minimum benefit per night”)

 

Item 1 amends clause 6 of Schedule 4 of the Private Health Insurance (Benefit Requirements) Rules 2011 (the Benefit Requirement Rules) to increase the minimum benefits payable by private health insurers for hospital treatment provided to nursing-home type patients in public hospitals in New South Wales from $131.00 to $133.60.

 

Item 2 – Clause 6 of Schedule 4 (Table 1, table item dealing with Northern Territory, column headed “Minimum benefit per night”)

 

Item 2 amends clause 6 of Schedule 4 of the Benefit Requirement Rules to increase the minimum benefits payable by private health insurers for hospital treatment provided to nursing-home type patients in public hospitals in the Northern Territory from $125.00 to $130.00.


Item 3 – Clause 6 of Schedule 4 (Table 1, table item dealing with Tasmania, column headed “Minimum benefit per night”)

 

Item 3 amends clause 6 of Schedule 4 of the Benefit Requirement Rules to increase the minimum benefits payable by private health insurers for hospital treatment provided to nursing home-type patients in public hospitals in Tasmania from $148.30 to $150.00.

 

Item 4 – Clause 6 of Schedule 4 (Table 2, table item dealing with Private hospitals, column headed “Minimum benefit per night”)

 

Item 4 amends clause 6 of Schedule 4 of the Benefit Requirement Rules to decrease the minimum benefits payable by private health insurers for hospital treatment provided to nursing home-type patients in private hospitals from $49.30 to $48.60.

 

Schedule 2Amendments Nursing –home type patients contribution

Private Health Insurance (Complying Product) Rules 2015

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

 

Item 1 amends the Private Health Insurance (Complying Product) Rules 2015 (the Complying Product Rules) to repeal paragraph (a) of the definition of “patient contribution” in section 8A(3) and substitute a new paragraph in its place. The effect of this change is that the daily rate for patient contribution (to fees for hospital treatment) payable by nursing-home type patients in all states and the Northern Territory’s public hospitals is $62.50. The rise in this rate reflects the Australian Government’s indexation of pensions and rent assistance on 20 March 2020. There is no change to the daily patient contribution payable by nursing home-type patients in public hospitals in the Australian Capital Territory. 

 

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

 

Item 2 amends the Complying Product Rules to provide that paragraph (b) of the definition of patient contribution in the Principal Rules is amended by increasing the nursing-home type patient contribution at private hospitals in Australia from $61.80 to $62.50.

 


Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Private Health Insurance Legislation Amendment Rules (No. 2) 2020

This instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the instrument

The purpose of the Private Health Insurance Legislation Amendment Rules (No. 2) 2020 (the Amendment Rules) is to amend the following instruments:

  • Private Health Insurance (Benefit Requirements) Rules 2011
  • Private Health Insurance (Complying Product) Rules 2015

 

These Amendment Rules amend Schedule 4 of the Private Health Insurance (Benefit Requirements) Rules 2011 (the Benefit Requirement Rules) to update minimum benefits for nursing home type patients at public hospitals in New South Wales, the Northern Territory, and Tasmania.

 

The Amendment Rules also amend the Private Health Insurance (Complying Product) Rules 2015 (the Complying Product Rules) to update the daily patient contribution payable by nursing home-type patients for hospital accommodation in public hospitals in all states and the Northern Territory, and all private hospitals across Australia. There is no change to the daily patient contribution payable by nursing-home type patients in public hospitals in the Australian Capital Territory.

Human rights implications

The Amendment Rules engage Article 12 of the International Covenant on Economic, Social and Cultural Rights, specifically the right to health, by assisting with the progressive realisation by all appropriate means of the right of everyone to the enjoyment of the highest attainable standard of physical and mental health.

Private health insurance regulation assists with the advancement of these human rights by improving the governing framework for private health insurance in the interests of consumers. Private health insurance regulation aims to encourage insurers and providers of private health goods and services to provide better value for money to consumers, and to improve information provided to consumers of private health services to allow consumers to make more informed choices when purchasing services. Private health insurance regulation also requires insurers to not differentiate the premiums they charge according to individual health characteristics such as poor health.

Analysis

The amendments relating to the updated minimum benefits and patient contributions for nursing-home type patients at public hospitals in some states and territories in the Benefit Requirement Rules and Complying Product Rules reflect regular indexation practices for the Commonwealth, and state and territory jurisdictions and therefore maintain the status quo arrangements.  

Conclusion

This instrument only engages human rights to the extent that it maintains current arrangements with respect to the regulation of private health insurance. Therefore, this instrument is compatible with human rights because these changes continue to ensure that existing arrangements advancing the protection of human rights are maintained.

Brian Kelleher
Assistant Secretary
Private Health Insurance Branch
Medical Benefits Division
Department of Health

Overview

The Private Health Insurance Legislation Amendment Rules (No. 2) 2020 were introduced to amend the Private Health Insurance (Benefit Requirements) Rules 2011 and the Private Health Insurance (Complying Product) Rules 2015. These amendments were necessitated by the need to reflect the indexation and adjustments applicable to Pension and Rent Assistance Rates from 20 March 2020. Enacted under the authority of the Minister for Health, these rules aim to align the minimum benefits payable by private health insurers and the daily patient contributions for nursing-home type patients (NHTPs) with the updated rates. The legislative instrument ensures that the existing regulatory framework for private health insurance continues to protect and advance the human right to health, as recognised in international instruments, by maintaining current arrangements that support better value for money and informed consumer choices in private health services. The rules also reflect the coordinated approach of the Commonwealth and state and territory governments in indexing these rates.

Scope and Application

The Private Health Insurance Legislation Amendment Rules (No. 2) 2020 apply to entities and individuals involved in the provision and regulation of private health insurance within Australia, specifically focusing on nursing home type patients (NHTPs). These Amendment Rules are applicable nationally and make adjustments to the Private Health Insurance (Benefit Requirements) Rules 2011 and the Private Health Insurance (Complying Product) Rules 2015 to reflect indexation and adjustments to the Pension and Rent Assistance Rates effective 20 March 2020. This includes updating the minimum benefits payable by private health insurers for NHTPs in public hospitals in New South Wales, the Northern Territory, and Tasmania, as well as adjusting the daily patient contribution for NHTPs in public and private hospitals across Australia. The Amendment Rules do not substantively alter existing arrangements but rather maintain the status quo by ensuring that the adjustments to benefits and contributions are in line with the regular indexation practices of the Commonwealth and state and territory jurisdictions. The rules exclude the Australian Capital Territory from changes in the NHTP contribution rate for public hospitals. The scope of these Amendment Rules is extended through subordinate instruments, which include the Private Health Insurance (Benefit Requirements) Rules 2011 and the Private Health Insurance (Complying Product) Rules 2015, to ensure the legislative changes are implemented effectively across the specified jurisdictions. This legislative amendment ensures that the provisions for NHTPs are updated in line with broader socio-economic adjustments, thereby maintaining a consistent regulatory framework for private health insurance in Australia.

Key Provisions

The Private Health Insurance Legislation Amendment Rules (No.2) 2020 (the Amendment Rules) introduce consequential amendments to the Private Health Insurance (Benefit Requirements) Rules 2011 and the Private Health Insurance (Complying Product) Rules 2015. Specifically, the Amendment Rules update the minimum benefits and patient contributions for nursing-home type patients (NHTPs) in line with indexation applied to the Commonwealth Adult Pension Basic Rate and Maximum Daily Rate of Rental Assistance, effective 20 March 2020. These amendments include increasing the minimum benefits for NHTPs in public hospitals in New South Wales, the Northern Territory, and Tasmania, and setting the daily patient contribution for NHTPs at $62.50 in all states and the Northern Territory, except for the Australian Capital Territory, where no changes are made. The obligations and requirements imposed by the Amendment Rules are primarily focused on updating the rates that private health insurers must pay for NHTPs in certain hospitals. Private health insurers must now adhere to the updated minimum benefits for NHTPs in public hospitals in New South Wales, the Northern Territory, and Tasmania, as well as the new daily patient contributions for NHTPs in public and private hospitals across Australia. These changes are intended to reflect the adjustments in the Pension and Rental Assistance Rates and are administrative in nature, not altering the substantive arrangements but ensuring that the rates are aligned with the latest indexation. Breaching the provisions of the Amendment Rules could lead to regulatory consequences. While specific penalties are not outlined in the explanatory statement, non-compliance with the updated rates and requirements could result in regulatory scrutiny, potential fines, or other enforcement actions by the relevant authorities. The consequences would depend on the severity and frequency of the breaches, as well as the specific regulatory frameworks governing private health insurance in Australia. The Amendment Rules are designed to maintain and update the regulatory framework for private health insurance in a way that is consistent with the progressive realisation of the right to health. By ensuring that the minimum benefits and patient contributions for NHTPs are in line with the latest indexation, the Amendment Rules help to uphold the existing arrangements that support the protection of human rights. This alignment with human rights is intended to support the enjoyment of the highest attainable standard of physical and mental health by ensuring that private health insurance continues to provide better value for money and more informed choices for consumers.

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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.