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1998-1999-2000-2001
THE PARLIAMENT OF THE COMMONWEALTH
OF AUSTRALIA
HOUSE OF REPRESENTATIVES
EXPLANATORY
MEMORANDUM
(Circulated
by authority of the Minister for Health and Aged Care,
the Hon. Dr Michael
Wooldridge, MP)
ISBN: 0642 46894X
HEALTH LEGISLATION AMENDMENT BILL (NO. 2) 2001
This bill contains amendments relating to four areas in the Health
portfolio:
Schedule 1 - the Australian Institute of Health and Welfare,
Schedule 2 - the recognition of specialist medical practitioners,
-
payment of Medicare benefits where cheques made out to general practitioners are
not presented within a defined period of time, and
Schedules 3 and 4 -
the 30% Rebate on private health insurance scheme.
In Schedule 1, the
amendments to the Australian Institute of Health and Welfare Act 1987 (AIHW Act)
broaden the Minister’s capacity to nominate persons who have specific
skills for appointment to the Institute, and extend the current legislative
coverage of the Australian Institute of Health Ethics Committee to include
welfare-related information and statistics. The amendments also include minor
changes to maintain the relevance of reference to the National Health and
Medical Research Council.
Schedule 2 contains two separate sets of
amendments to the Health Insurance Act 1973. The first set is primarily
designed to simplify the process for recognising medical practitioners as
specialists (but without changing the criteria for recognition).
For
those Australian-domiciled practitioners who are Fellows of a College and hold
relevant qualifications, the current scheme envisages that they may be
recognised as specialists by means of a Ministerial determination under section
3D or under section 61 (but, in the latter case, following consideration by, and
a recommendation of, a Specialist Recognition Advisory Committee). The proposed
changes will involve such a practitioner automatically being recognised as a
specialist, where the relevant College provides the Health Insurance Commission
with a notice certifying that he or she satisfies the recognition criteria.
Recognition will occur without the need for a Ministerial determination or
consideration by a Specialist Recognition Advisory Committee.
The current
provisions covering Australian-domiciled practitioners who are registered as
specialists under a State law are replicated by the proposed new
scheme.
The second set in Schedule 2, amending the
Health Insurance Act 1973, will allow the Health Insurance Commission
(‘the Commission’) to pay Medicare benefits directly to general
practitioners, where ‘pay doctor via claimant’ cheques made out to
the general practitioners are not presented within 90 days of issue.
Subsection 20(1) of the Health Insurance Act 1973 provides that
Medicare benefits are payable only to the person who incurs the medical expenses
(the patient). The patient’s right to receive the Medicare benefit is
modified by subsection 20(2) which deals with the situation where a patient has
not paid the medical expenses that he or she has incurred. In this situation,
the patient can request that a cheque for the amount of the Medicare benefit be
drawn by the Commission in favour of the medical practitioner who rendered the
professional services. These cheques are referred to as ‘pay doctor via
claimant cheques’. Subsection 20(2) requires that such cheques be given
or sent to the patient personally. Subsection 20(2) does not allow for
‘pay doctor via claimant’ cheques to be sent directly to the
doctor.
The great majority of patients do present ‘pay doctor via
claimant’ cheques to their general practitioners in a timely manner.
However, some cheques are received very late and some are never presented,
leaving doctors with unnecessarily long delays or ultimately bad debts for
medical services already provided in good faith.
To minimise this
problem, the amendment to the Act will allow the Commission to pay the amount of
benefit directly to a general practitioner. This will only be allowed where a
‘pay doctor via claimant’ cheque has not been presented within 90
days from the date of issue and only applies to ‘pay doctor via
claimant’ cheques for services rendered by general
practitioners.
Schedules 3 and 4 amend the Private Health Insurance
Incentives Act 1998 (PHIIA) and the Health Legislation Amendment Act (3)
1999, respectively. The amendments relate to the provision of
incentives for private health insurance, commonly known as the Federal
Government 30% Rebate on private health insurance.
The main amendment
will allow the Health Insurance Commission to make payments to health funds that
lodge low or late claims for the reimbursement under the premium reduction
scheme for the 30% Rebate. Currently funds seek reimbursement for low or late
claims under the Act of Grace provisions contained in section 33 of the
Financial Management and Accountability Act 1997.
The
other main amendment defines how the premium decrease for the 30% Rebate is to
be applied and calculated.
The other amendments rectify minor technical
inconsistencies relating to the last set of amendments to the PHIIA.
FINANCIAL IMPACT STATEMENT
The Bill will have no significant financial impact.
HEALTH LEGISLATION AMENDMENT BILL (No. 2)
2001
NOTES ON CLAUSES
This is a formal provision that specifies the short title of the Act as
the Health Legislation Amendment Act (No. 2) 2001.
Sub-clause 2(1) provides that subject to sub-clause 2, the Act
commences on the day on which the Act receives Royal
Assent.
Sub-clause 2(2) provides that Items 7, 8, 9 and 10 of
Schedule 3 are taken to have commenced on the day on which the Private Health
Insurance Incentives Act 1998 commenced.
Sub-clause 2(3)
provides that Item 12 of Schedule 3 is taken to have commenced on
1 January 1999.
Clause 3 – Schedule(s)
The
section notes that each Act that is specified in the Schedule is to be amended
or repealed as set out in the applicable items in the Schedule, and subject to
the commencement provisions in section 2.
This item extends the scope of responsibility of the Institute’s Ethics
Committee to include welfare-related information and statistics.
SCHEDULE 2 - AMENDMENT OF THE HEALTH INSURANCE ACT
1973
Part 1 – Recognition of
specialists
Item 1
This item makes a cross-referencing
change within the subsection 3(1) definition of “specialist”,
consequent upon other changes made by the Schedule.
Item 2
This item adds, at the end of the subsection 3(1) definition of
“specialist”, a reference to medical practitioners taken to be
recognised under the new section 3D regime involving automatic
recognition.
Item 3 repeals current section 3D, and substitutes a number of new
sections covering recognition as a specialist.
New section 3D provides the regime for automatic recognition of certain
practitioners as specialists. Under subsection 3D(1), such recognition is
accorded to a practitioner where the relevant College gives the Managing
Director of the Health Insurance Commission a written notice stating that the
practitioner meets the criteria for the speciality.
Subsection 3D(2) then
sets out the criteria which must be satisfied to trigger the automatic
recognition regime : these are (a) Australian domicile; (b) fellowship of the
relevant specialist College; and (c) a relevant qualification (following
successful completion of an appropriate course of study). Definitions of
“relevant organisation” and “relevant qualification” are
contained in subsection 3D(5). (These criteria mirror the criteria set out in
current paragraph 3D(1)(a).)
Subsection 3D(3) ensures that the
practitioner is notified of his or her specialist recognition under the
automatic regime, as soon as reasonably practicable.
Subsection 3D(4)
makes clear that the new automatic regime set out in section 3D operates in
addition to the alternative recognition method contained in section 3DB, and
does not in any way limit the operation of the alternative method.
New section 3DA makes provision in relation to the effective day of the
specialist’s recognition under the section 3D automatic recognition
regime, and cessation of recognition in certain circumstances.
Subsection
3DA(1) provides that the effective day of recognition of a specialist taken to
be recognised under subsection 3D(1) is the day specified in the notice of
advice provided to the specialist by the Health Insurance Commission’s
Managing Director.
Subsection 3D(2) goes on to provide that this day can
be earlier than the day of the notice itself. However, it cannot be earlier
than the day specified by the College as the date that the practitioner first
met the recognition criteria.
Subsection 3DA(3) provides for an automatic
cessation of a section 3D recognition if (a) the relevant College gives a notice
to the Health Insurance Commission stating that the criteria for recognition
(these being, in short, Australian domicile; Fellowship; and relevant
qualifications) are no longer met, or the practitioner has ceased to practise
medicine in Australia; or (b) the practitioner requests that he or she no longer
be recognised.
New section 3DB sets out the alternative method of recognition as a
specialist, for those practitioners who have not automatically been recognised
as such under the section 3D regime. Subsection 3DB(2) makes clear that this
alternative method will apply to practitioners who meet the subsection 3D(2)
criteria – but who, for whatever reason, have not been the subject of a
notice from the relevant College to the Health Insurance Commission under
subsection 3D(1). The alternative section 3DB method will also apply to those
practitioners who are not Fellows with relevant qualifications, but who are
merely Australian-domiciled State-registered specialists (subsection 3DB(1).
For these two classes of practitioners, subsection 3DB(3) requires a written
application accompanied by the prescribed fee. The application will then be
resolved by means of either a Ministerial determination (subsection 3DB(4)(a))
or referral of the matter – under subsection 61(1) – to the
appropriate Specialist Recognition Advisory Committee. The practitioner will be
notified accordingly, in writing.
Subsection 3DB(5) defines
“appropriate Specialist Recognition Advisory Committee”, for
purposes of subsection 3DB(4), as the Committee established for the State or
Territory where the practitioner is domiciled.
The provisions of
subsection 3DB are intended to mirror the operation of current section 3D (now
being repealed).
Consistently with new subsection 3DA(1) and paragraph 3DA(2)(a), section
3DC provides that a paragraph 3DB(4)(a) determination is effective from the day
specified in the determination, which may be a day earlier than the day of the
determination itself.
Provision is also made, in subsection 3DC(3), for
cessation of the determination where the practitioner ceases to be
Australian-domiciled or to practise medicine (consistently with subsection
3DA(3)(a)). The Minister is required to revoke the determination if the
practitioner so requests (subsection 3DC(4)) – the comparable provision
under the automatic regime provisions is paragraph 3DA(3)(b).
This item repeals a now-superfluous provision of the Act. Section 51
allowed for members of the Specialist Recognition Advisory Committees and
Specialist Recognition Appeal Committee under the National Health Act
1953, to be deemed to members of those Committees under the Health
Insurance Act 1973, when the functions of those Committees were transferred
from the former Act to the latter Act.
Item 5
This item
makes a cross-referencing change within subsection 61(1B), consequent upon other
changes made by the Schedule.
This item ensures the preservation of relevant regulations in force
immediately before Royal Assent, so that there is no need – merely
consequent upon the Schedule amendments – to make new regulations defining
“relevant organisation” or “relevant qualification” for
purposes of new subsection 3D(5) or prescribing a fee for purposes of new
paragraph 3DB(3)(b).
Item 6(3) makes clear that the ordinary ability to
amend or repeal the Health Insurance Regulations, by regulations under the
Health Insurance Act 1973, is unaffected by this Schedule.
Amends section 20 by inserting new subsections 20(3), 20(4) and 20(5),
which permits the Commission, in limited circumstances, to pay Medicare benefits
direct to general practitioners.
New subsection 20(3) provides that the
Commission may pay Medicare benefits payable in respect of a professional
service directly to a general practitioner where a ‘pay doctor via
claimant cheque’ is not presented within 90 days after issue.
New
subsection 20(4) provides that if the Commission pays an amount under subsection
(3) to a general practitioner, the request under subsection 20(2) by the person
to whom the Medicare benefit is payable, to give or send a cheque for the amount
of the Medicare benefit, is withdrawn and that person may not make any
subsequent request under subsection (2).
New subsection 20(5) provides
that the Commission may pay an amount under subsection (3) by means of
electronic transmission of the amount to an account kept with a bank.
Item 8 provides that item 7 of this Schedule applies to cheques given or
sent under subsection 20(2) after 1 July 2001 or if the day on which this Act
receives Royal Assent is after 1 July 2001, that day.
SCHEDULE 3
– AMENDMENT OF THE PRIVATE HEALTH INSURANCE INCENTIVES ACT
1998
Schedule 3 amends the PHIIA to allow payment for low
or late claims to occur through the HIC. It clarifies how the premium reduction
should be calculated and rectifies a number of minor inconsistencies within the
PHIIA. Schedule 4 deletes an unnecessary item in Health Legislation Amendment
Act (No.3) 1999.
This item inserts four new sections after section 15-20 to enable the HIC
to make additional payments for low or late claims. Under the PHIIA,
health funds have seven days after the end of each month to lodge a claim
with the HIC for reimbursement for the premium reduction scheme. At present a
health fund missing or failing to claim the correct amount by this deadline has
no other recourse except to recover payment via an Act of Grace
mechanism.
New section 15-21 enables a fund to apply to the Managing Director of HIC
for an additional payment if their original claim for reimbursement was for less
than their actual entitlement.
New section 15-21 enables a fund to apply to the Managing Director of HIC
for an additional payment if their claim for reimbursement was late i.e. after
the timeframe specified in PHIAA.
This section specifies the content of the application including an
auditors certificate to verify the amount being claimed and the reasons for the
low or late claim. It also limits the time frame for claims to three years from
when the low or late claim occurred.
This section details the criteria by which the application is approved
and how the funds are to be notified of the Managing Director’s
decision.
This item makes a minor amendment to section 15-20 so that the HIC must
notify a health fund of the reasons for a refusal of an application for
additional payments.
Item 3
This item makes minor
amendments to paragraphs 18-5(1)(c), (d) and (e) to extend the recovery of
payments provisions to cover additional payments in section 15-24
This amendment extends the Administrative Appeals Tribunal review
provisions to cover additional payments.
This item allows a health fund to submit an application for an additional
payment for a low or late claim that occurred before and after the commencement
of these amendments. A fund can utilise the additional payment mechanism for a
low or late claim that occurred prior to commencement.
Item 6 amends subsection 11-25(1) by omitting “it must, within 28
days after the day on which the refusal occurs” and substitutes “it
must”
This amendment will correct an anomaly in the PHIIA,
subsection 11-25(1) where a new time frame was inserted unnecessarily during the
last set of amendments to the PHIIA.
In sub-section 11-25(2) there is
already a 14 day time frame built into the legislation, after which time, if a
person had not received notification that their application for registration in
the premium reduction scheme was refused, they would be deemed to be registered.
The
14 day period is the more advantageous of the two time frames for
applicants.
This item inserts two new subsections (1A) and (1B) after subsection
12-5(1).
This amends the PHIIA such that the directions of how to
calculate reduction in premiums as described in Chapter 3 section 12-5 are
consistent with those for incentive payments as described in Chapter 2 section
4-10, in so far as they relate to persons registered or eligible to apply for
registration under the previous scheme as contained in the Private Health
Insurance Incentive Act 1997.
These amendments will make the calculation of premium reductions
consistent with the incentive payments scheme.
This item inserts a transitional provision to ensure funds are not
disadvantaged due to the retrospective nature of this part.
Item 12 amends subsection 15-15(2) by omitting “The HIC must pay to
the health fund” and substituting “if a health fund makes a claim
that the HIC decides is correct, the HIC must pay to the
fund”.
This is a technical amendment which was previously
misdescribed . It is taken to have commenced on 1 January 1999 (ie when Schedule
3 of No. 159 of 1999 was taken to have commenced).
This item repeals Part 2 of Schedule 3 of the Health Legislation
Amendment Act (No.3) 1999.
Part 2 of the HLAA (No.3) 1999 was an
amendment to the Health Insurance Commission Act 1973 (HIC Act
1973) to indicate that the functions of the HIC included administering the
Private Health Insurance Incentives Act 1997 and PHIIA. However, the
section 8DA referred to in Part 2 had previously been repealed so that the item
was incorrectly described.
A replacement amendment is not necessary as
s8AA(1)(a)(ii) of HIC Act 1973 provides that the functions of the Commission
include those prescribed under any other Act eg. the PHIIA.
HEALTH LEGISLATION AMENDMENT BILL (NO. 2) 2001
fund health benefits fund
PHIIA Private
Health Insurance Incentives Act 1998
HLAA Health Legislation
Amendment Act
PHIIS Private Health Insurance Incentives Scheme (as
contained in the Private Health Insurance Incentives Act
1997)
HIC Health Insurance Commission