Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1)

Administered by Department of Health, Disability and Ageing

Legislation au F2011L00518 Rules Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Issued by the Authority of the Private Health Insurance Administration Council

 

Private Health Insurance Act 2007

 

 

Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1)

 

 

Authority for the Rules

 

The Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2007 (the Rules) are made by the Private Health Insurance Administration Council (the Council) under item 3 of the table in section 333-25, for the purposes of Part 6-7 of the Private Health Insurance Act 2007 (the Act).

 

Section 333-25 of the Act provides that the Council may make rules providing for:

(a)   matters required or permitted by the corresponding Chapter, Part or section of the Act to be provided; or

(b)   necessary or convenient to be provided in order to carry out or give effect to that Chapter, Part or section.

 

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

 

All legal and other requirements for making the Rules have been met.

 

Purpose of the Amendment

 

The purpose of this amendment is:

  • to remove from the Private Health Insurance (Risk Equalisation Administration) Rules 2007 the Schedule – Quarterly Return.  The removal of the Quarterly Return provides for PHIAC and the industry to be more responsive and adaptable to government and industry data requirements.  The requirement to lodge a paper copy is also removed, taking a burden off private health insurers. PHIAC has the power to request the information required for the purpose of Risk Equalisation under Section Section 264-10 of the Private Health Insurance Act 2007 and data will continue to be collected under this power.

 

An explanation of the rules is set out in the Attachment.

 

Consultation

 

Consultation was undertaken in relation to the Amending Rules with private health insurers. Insurers initiated the amendment and the Private Health Insurance Administration Council agreed to the amendment after considering the benefits to the industry.


ATTACHMENT

 

DETAILS OF THE PRIVATE HEALTH INSURANCE (RISK EQUALISATION ADMINISTRATION) AMENDMENT RULES 2011 (No. 1)

 

  1. Name of Rules

 

Rule 1 provides that the title of the Rules is the Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1).

 

2.      Commencement

 

Rule 2 provides that the Amending Rules are to commence the day after they are registered.

 

3.      Amendment of the Private Health Insurance (Risk Equalisation Administration) Rules 2007

 

Rule 3 provides that the Schedule of the Amending Rules amends the Private Health Insurance (Risk Equalisation Administration) Rules 2007.

 

 

Schedule 1 Amendments

Paragraphs [1] to [6] provide clarification of the rules. Paragraphs [7] to [12] provide details of the removal from the Rules of the Quarterly Return and the requirements of private health insurers to complete the electronic Quarterly Return in the form provided on PHIAC’s web site.

[1] Subrule 3 (3)

omit

[2] Paragraph 4 (b)

substitute

(b) which of the following the policy covers:

(i) hospital treatment;

(ii) hospital-substitute treatment;

(iii) chronic disease management programs;

(iv) ambulance service;

(v) other general treatment; and

[3] Subparagraph 4 (e) (iii)

substitute

(iii) whether the benefit was paid for:

(A) hospital treatment; or

(B) hospital-substitute treatment; or

(C) chronic disease management program treatment; or

(D) ambulance services; or

(E) other general treatment; and

[4] Rule 5

omit everything before paragraph (a), insert

(1) This rule applies if the insurer includes in a quarterly return a gross benefit for the high cost claimants pool.

Note Part 3 sets out the requirements for providing quarterly returns.

(2) In addition to the information to be kept in accordance with rule 4, the insurer must keep a record that contains the following information in respect of the insured person to whom the gross benefit relates:

[5] Subrule 6 (1)

omit

Council for each fund that it conducts

insert

Council, for each fund that it conducts,

[6] After subrule 6 (4)

insert

(4A) For the purpose of quarterly returns, a benefit is regarded as being paid during the quarter in which the benefit is recorded and liability for it is accepted.

[7] Subrule 7 (1)

substitute

(1) Quarterly returns must be:

(a) given to the Council as electronic data in the form approved by the Council; and

(b) accompanied by a signed copy of the certification mentioned in subrule (3) as a PDF file.

Note for paragraph (a) The approved form for paragraph (a) is available at http://www.phiac.gov.au.

[8] Subrule 7 (2)

omit

electronic form of the quarterly return

insert

data mentioned in paragraph 1 (a) Schedule 1 Amendments 4

[9] Subrule 7 (3), except the note

substitute

(3) For paragraph 7 (1) (b), an officer of the insurer must certify that the information in the quarterly return is true and correct.

[10] Subrule 7 (4)

substitute

(4) If an officer is unable to give the certification mentioned in subrule (3), the quarterly return must be accompanied by a statement by an officer of the insurer stating why the certification cannot be provided.

[11] Rule 9

omit

[12] Schedule — Quarterly return

omit

 

The Schedule – Quarterly return has been removed from the Rules.

The removal of the Quarterly Return provides for PHIAC and the industry to be more responsive and adaptable to government and industry data requirements.  PHIAC has the power to request the information required for the purpose of Risk Equalisation under Section Section 264-10 of the Private Health Insurance Act 2007 and data will continue to be collected under this power.

Overview

The Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1) were made by the Private Health Insurance Administration Council under the Private Health Insurance Act 2007, with the aim of refining the administrative processes for risk equalisation in the private health insurance industry. The Council, established under the Act, has the authority to create these rules to ensure the efficient implementation of risk equalisation, which aims to distribute funds more equitably among health funds based on the risk profile of their insured members. By amending the existing rules, the Council seeks to enhance responsiveness to government and industry data requirements and alleviate the administrative burden on private health insurers. This change was initiated by the industry and subsequently agreed upon by the Council after evaluating the potential benefits to the sector. The new rules facilitate the electronic submission of necessary data, thereby promoting a more streamlined and adaptive approach to risk equalisation administration.

Scope and Application

The Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1) were made by the Private Health Insurance Administration Council (PHIAC) under the authority of the Private Health Insurance Act 2007. These rules amend the existing Private Health Insurance (Risk Equalisation Administration) Rules 2007, specifically removing the Schedule – Quarterly Return, which pertains to the quarterly reporting requirements for private health insurers. This amendment was made to improve the responsiveness and adaptability of both PHIAC and the private health insurance industry to government and industry data requirements. Insurers now have the flexibility to submit data in a manner that suits their operational needs, with the understanding that PHIAC retains the authority to request necessary information for Risk Equalisation purposes under Section 264-10 of the Act. These rules apply to private health insurers who must submit electronic data as approved by PHIAC, ensuring compliance with the updated administrative requirements. The removal of the paper copy requirement alleviates a burden on insurers, facilitating a more efficient data collection process.

Key Provisions

The Private Health Insurance (Risk Equalisation Administration) Amendment Rules 2011 (No. 1) primarily amend the Private Health Insurance (Risk Equalisation Administration) Rules 2007 by removing the Schedule – Quarterly Return, which detailed the requirements for quarterly returns from private health insurers. These changes are made under Section 333-25 of the Private Health Insurance Act 2007, which allows the Private Health Insurance Administration Council (PHIAC) to make rules necessary or convenient to carry out the Act's provisions. The purpose of these amendments is to make PHIAC and the private health insurance industry more adaptable to government and industry data requirements, while also reducing the burden on private health insurers by eliminating the need to lodge a paper copy of the quarterly return. Insurers can now submit quarterly returns electronically in a form approved by PHIAC, available on their website. These rules impose specific obligations on private health insurers. Firstly, they must ensure that their quarterly returns are provided to PHIAC in electronic form, in the format approved by PHIAC. Secondly, an officer of the insurer must certify that the information in the quarterly return is true and correct, and this certification must be provided as a PDF file. If the officer is unable to certify the information, they must provide a statement explaining why the certification cannot be given. Insurers are also required to keep detailed records of insured persons, including specific information about the type of treatment covered by their policies. Failure to comply with these rules can result in penalties and other consequences. While the specific penalties are not outlined in the amendment rules, the Private Health Insurance Act 2007 generally provides for both civil and criminal penalties for breaches of the Act and related rules. Civil penalties can include fines up to $11,100 per offence for individuals and $55,500 for bodies corporate. Criminal penalties can include fines of up to $222,000 for individuals and $1,110,000 for bodies corporate, as well as potential imprisonment for more serious offences. These penalties reflect the importance of compliance with private health insurance regulations in ensuring the proper functioning of the risk equalisation scheme and the broader private health insurance system in Australia.

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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.