Private Health Insurance Supervisory Levy Imposition Determination 2016

Overview

The Private Health Insurance Supervisory Levy Imposition Determination 2016, enacted by the Commonwealth of Australia, was introduced to address the need for a levy to cover the costs of supervising private health insurance entities. The Act was passed by the Australian Parliament and commenced on 1 July 2016, targeting the 2016-17 financial year. This legislative instrument is a response to the Private Health Insurance Supervisory Levy Imposition Act 2015, which mandates the Treasurer to determine the levy amount and the date for assessing policy numbers. The primary objective of this determination is to ensure that the estimated $4.136 million supervisory costs for the 2016-17 financial year are recovered through a levy on all complying health insurance policies as of the census day, 1 July 2016. The levy is calculated based on the number of policies, with a maximum of $2 per single policy and twice that amount for other policies. The public was consulted on these levies through a Treasury and Australian Prudential Regulation Authority discussion paper, and the determination is deemed compatible with human rights as outlined in the attached statement.

Scope and Application

The Private Health Insurance Supervisory Levy Imposition Determination 2016 applies to private health insurance entities, specifically targeting those with complying health insurance policies on issue as of 1 July 2016. This determination, pursuant to the Private Health Insurance Supervisory Levy Imposition Act 2015, mandates that a levy be imposed to recover the estimated supervision costs of $4.136 million for the 2016-17 financial year. The levy amount is calculated based on the number of single and other types of policies, with a cap of $2 per single policy. The levy is levied on all complying health insurance policies that apply on the census day, which is set as 1 July 2016 for the specified financial year. This levy is applicable nationwide, given the Commonwealth jurisdiction of the Act. The determination does not specify any exclusions, exemptions, or thresholds apart from the cap on the levy amount per single policy. Subordinate instruments may further extend or restrict the application of this determination as deemed necessary by the Minister.

Key Provisions

The Private Health Insurance Supervisory Levy Imposition Determination 2016 (F2016L01163) establishes the levy imposed on private health insurance entities by the Private Health Insurance Supervisory Levy Imposition Act 2015 for the 2016-17 financial year. The levy amount is calculated based on the number of complying health insurance policies on issue, with a cap of $2 per single policy, and it is intended to cover the estimated $4.136 million cost of supervising private health insurance providers. The levy is to be assessed by health insurance providers on 1 July 2016, which is designated as the census day for this purpose. The Act imposes several obligations on the parties it governs. Firstly, it mandates the Minister to determine the levy amount, which must consider the number of complying health insurance policies on issue, subject to a maximum supervisory levy amount per policy. Secondly, it requires health insurance providers to assess the number of each type of policy they have on issue to determine the amount of supervisory levy payable. This assessment must be completed by the specified census day, 1 July 2016, for the 2016-17 financial year. The determination does not explicitly outline specific offences, penalties, or consequences for non-compliance. However, as a legislative instrument, any breach of the provisions of the Act or the determination could potentially lead to legal actions under the relevant legislation. The severity of penalties would depend on the specific breach and could range from fines to more severe civil or criminal penalties as prescribed under the overarching Act. The determination notes that the commencement of the Act prior to its registration does not adversely affect the rights of any person or impose any liability for actions taken before registration, aligning with subsections 12(2) and 12(3) of the Legislation Act 2003.