EXPLANATORY STATEMENT

Private Health Insurance Act 2007

Private Health Insurance (Prostheses) Amendment Rules 2015 (No. 1)

Section 333-20 of the Private Health Insurance Act 2007 (the Act) provides that the Minister may make Private Health Insurance (Prostheses) Rules, providing for matters required or permitted by Part 3-3 of the Act, or necessary or convenient in order to carry out or give effect to Part 3-3 of the Act.

The Private Health Insurance (Prostheses) Amendment Rules 2015 (No. 1) (the Amendment Rules) amend the Private Health Insurance (Prostheses) Rules 2015 (No.1) (the Principal Rules) to reflect decisions made since the Principal Rules were made on applications to list new products and to change details of a product on the Prostheses List, to delete billing codes for two products no longer sold and to correct one minor drafting error in the Principal Rules.

Item 4 of the table in subsection 72-1(2) of Part 3-3 of the Act provides for requirements that a complying health insurance policy that covers hospital treatment must meet.  There must be a benefit for the provision of a prosthesis, of a kind listed in the Principal Rules (i.e. a listed prosthesis), in specified circumstances and under any specified conditions.  The specified circumstances are that the listed prosthesis is provided in circumstances in which a Medicare benefit is payable or those other circumstances which are set out in the Principal Rules.

If the complying health insurance policy also covers hospital-substitute treatment, the same requirements apply.

Listed prostheses are currently set out in the Schedule to the Principal Rules. 

The Amendment Rules will vary the Principal Rules as follows:

• deleting 2 billing codes – EH004 and EH005 - from Part A of the Schedule at the request of the sponsor;
• adding 2 new billing codes – SO076 and SA170 – to Part A of the Schedule following the granting of applications for listing;
• changing the grouping and increasing the minimum benefit of 1 billing code – CO073 – in Part A of the Schedule following a request from the sponsor for a review of the listing; and
• reinstating the listing of 1 billing code – JJ789 – on Part A of the Schedule after it was deleted in error.

The Amendment Rules commence 1 May 2015.

Consultation

In accordance with section 17 of the Legislative Instruments Act 2003, the Department consulted with the sponsor of each kind of prosthesis affected by these amendments. There are no objections to the amendments. The Department has received a standing Regulatory Impact Statement exemption from the Department of Finance and Deregulation.

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

Statement of Compatibility with Human Rights

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

Private Health Insurance (Prostheses) Amendment Rules 2015 (No. 1)

This Legislative 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 Legislative Instrument

The Private Health Insurance (Prostheses) Amendment Rules 2015 (No. 1) (the Rules) amend the Private Health Insurance (Prostheses) Rules 2015 (No. 1) (the Principal Rules) to reflect decisions made since the Principal Rules were made on applications to list new products and to change details of a product on the Prostheses List, to delete billing codes for two products no longer sold and to correct one minor drafting error in the Principal Rules.

Item 4 of the table in subsection 72-1(2) of Part 3-3 of the Private Health Insurance Act 2007 provides for requirements that a complying health insurance policy that covers hospital treatment must meet.  There must be a benefit for the provision of a prosthesis, of a kind listed in the Principal Rules (i.e. a listed prosthesis), in specified circumstances and under any specified conditions.  The specified circumstances are that the listed prosthesis is provided in circumstances in which a Medicare benefit is payable or those other circumstances which are set out in the Principal Rules.

If the complying health insurance policy also covers hospital-substitute treatment, the same requirements apply.

Listed prostheses, identified by billing code, are currently set out in the Schedule to the Principal Rules. 

The Amendment Rules amend the Principal Rules by:

• deleting 2 billing codes – EH004 and EH005 - from Part A of the Schedule at the request of the sponsor;
• adding 2 new billing codes – SO076 and SA170 – to Part A of the Schedule following the granting of applications for listing;
• changing the grouping and increasing the minimum benefit of 1 billing code – CO073 – in Part A of the Schedule following a request from the sponsor for a review of the listing; and
• reinstating the listing of 1 billing code – JJ789 – on Part A of the Schedule after it was deleted in error.

Human rights implications

The Amendment Rules engage the following human rights:

Right to Health

The right to health – the right to the enjoyment of the highest attainable standard of physical and mental health – is contained in article 12(1) of the International Covenant on Economic Social and Cultural Rights (ICESCR).  Whilst the UN Committee on Economic Social and Cultural Rights (the Committee) has stated that the right to health is not to be understood as a right to be healthy, it does entail a right to a system of health protection which provides equality of opportunity for people to enjoy the highest attainable level of health.

The Amendment Rules add 2 new billing codes to the Schedule to the Principal Rules, and reinstate 1 billing code to the Schedule.  The Amendment Rules also change the grouping and increase the minimum benefit for one billing code.  Each of these changes has a beneficial impact on the right to health in Australia, ensuring that minimum benefits, or higher minimum benefits, are required to be paid for the provision of these prostheses under private health insurance policies covering hospital treatment, where relevant conditions are met.   

The Amendment Rules also delete 2 billing codes at the request of the sponsors or suppliers of these prostheses, as these products are no longer sold.  Generally the prostheses removed from the Principal Rules have been replaced by newer models due to upgraded technologies or advancements in surgical procedures. 

The amendments made by the Amendment Rules do not reduce the minimum benefit payable for any listed prosthesis.

Conclusion

The Amendment Rules are compatible with human rights because they advance the protection of human rights, specifically the right to health.

Lyndall Moore

Acting Assistant Secretary

Private Health Insurance Branch

Medical Benefits Division

Department of Health