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Thursday, 30 August 2001
Page: 30612

Mr McGAURAN (Minister for the Arts and the Centenary of Federation) (9:37 AM) —I move:

That the bill be now read a second time.

This bill contains a number of amendments to legislation under the Health and Aged Care portfolio. The first set of amendments relates to therapeutic goods.

The proposed changes to the Therapeutic Goods Act 1989 will enable the mutual recognition agreement, entered into between Australia and Singapore, to be implemented. The amendments will allow the Secretary to the Department of Health and Aged Care to accept the conclusions of good manufacturing practice (GMP) inspections and manufacturing certificates as evidence that the manufacturing processes employed in Singapore in the manufacture of medicines that are exported to Australia meet with Australian requirements. The certificates are issued, pursuant to the mutual recognition agreement by inspection services designated as such by the government health regulatory body in Singapore, and approved by the secretary in Australia to provide certificates of good manufacturing practices for medicines imported into Australia. The certificates are taken into account for the purposes of determining whether medicines imported from Singapore may be supplied to the general public in Australia.

Provision is made for the minister to declare other countries to be covered by mutual recognition agreement (MRA) similar to the MRA with Singapore, as Australia enters into, or becomes a party to, other binding agreements. These other MRAs, features of which may be prescribed in the regulations, will enable Australia to accept GMP certificates as evidence that the manufacturing processes employed in the manufacture of medicines imported to Australia from those countries meet with Australian requirements.

The Therapeutic Goods Administration (TGA) extended its oversight of the blood system to include fresh blood components in 2000. These therapeutic goods, which are manufactured from individual blood donors, are not possible to define in ways that would lead to their inclusion in the Australian Register of Therapeutic Goods. They are therefore regulated through the use of standards, the licensing of blood establishments and the assessment of technical data. To demonstrate satisfactory compliance with these measures, the TGA frequently requires information from the blood establishments. At present the only way to elicit this information is through the conduct of an audit for good manufacturing practice of the establishment, which is a complex process. Through these amendments, the TGA will be able to request information related to the quality and safety of blood components without having to undertake an audit of the blood establishment. The TGA already has the ability to obtain information for standard medicinal products included in the Australian Register of Therapeutic Goods.

Currently, applicants seeking to register their medicines in the Australian Register of Therapeutic Goods must pay fees when an evaluation of an application to register a medicine in the register has been completed. However, following the completion of an evaluation, the results of which are usually communicated to an applicant, but before the secretary notifies the applicant of his/her decision to register or not to register the medicine, an applicant may withdraw. Where this occurs, the secretary is not able to recover the cost of the evaluation that has already been completed. The effect of these amendments is to enable the secretary to recover the balance of the evaluation fees owing for the evaluation work completed.

There are also amendments to the Professional Services Review (PSR) Scheme, that commenced in 1994. The scheme is a process of peer review under which an individual health practitioner's conduct can be examined to ascertain whether inappropriate practice is involved in the rendering or initiating of Medicare services or in prescribing under the Pharmaceutical Benefits Scheme (PBS). A comprehensive review of the PSR Scheme was undertaken in 1999. As a result, significant legislative amendments were made to the provisions of the Health Insurance Act governing the scheme. The PSR amendments contained in this bill clarify certain aspects of the operation of the earlier changes and overcome administrative difficulties that have emerged in their implementation.

In particular, the amendments clarify the scope of the investigations that the Director of the Professional Services Review Scheme and the PSR Committee are able to undertake concerning referred matters. The Health Insurance Commission has statistical data, and the director also has access to patient records, but many problems will never be evident from statistics or records alone. Examples are the invalid performance of tests or the unjustified repetition of diagnostic procedures. They are only a couple of the examples which require the clarification of those amendments of 1999.

The amendments in this bill make clear that referrals need not specify particular conduct to be examined by the Director of the Professional Services Review Scheme or a PSR committee. They are not excluded from investigating concerns about a practitioner's conduct in connection with referred services, whether or not such concerns have been identified in the referral processes. The bill also makes clear that the investigations are not limited by the reasons stated in the referrals. The conduct able to be investigated must still relate to the referred services.

The bill also includes amendments to strengthen and streamline the administration of the scheme.

In the PSR process, normal procedural fairness safeguards will continue to apply. The services to be investigated are clearly identified in advance, so the practitioner knows where investigations will focus. The commission's and the director's reasons for referral indicate the likely direction of inquiry, but this is ultimately a matter for the PSR Committee. Both the person under review and the committee can be assisted by legal advisers. There is protection against self-incrimination. The person under review is also entitled to comment on a draft of the committee's report and later a draft determination prior to a final determination being made.

There is also an amendment concerning number of commissioners of the Health Insurance Commission. This amendment relates to legislative changes made at the time of the separation of Medibank Private from the Health Insurance Commission. Under the Health Insurance Commission (Reform and Separation of Functions) Act 1997, the number of commissioners (in addition to the chairperson and managing director) increased for a five-year period from seven to nine, but then was to decrease to five.

The amendment contained in this bill will operate so that, after that five-year period (that is, from November 2002), the number of these additional commissioners will decrease from nine to seven (rather than from nine to five).

The bill will make some minor amendments related to private health insurance arrangements. Currently, health funds may only offer discounts to contributors who pay at least six months in advance. This will be amended to allow discounts to be offered from a starting point of three months in advance. It will also remove an anachronism that currently prevents employers contributing directly towards health expenses incurred by employees who have an agreement under part VIB of the Industrial Relations Act 1988. This will be beneficial to contributors and to private health insurance generally. The bill also makes some minor technical amendments. I commend the bill to the House and present the explanatory memorandum.

Debate (on motion by Mr Griffin) adjourned.