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Thursday, 2 March 2006
Page: 1

Mr ABBOTT (Minister for Health and Ageing) —I move:

That this bill be now read a second time.

The bill proposes to amend the Health and Other Services (Compensation) Act 1995, known as the HOSC Act. The act was passed to ensure that those successful claimants for compensation do not ‘double dip’ by obtaining dual payments for their Medicare, nursing home and residential care payments. When plaintiffs go to court to recover damages for personal injuries, the legislation requires that they repay to the Commonwealth the cost of any Medicare, nursing home and residential care benefits received because of the injury for which they have also been compensated as part of the compensation judgment or settlement.

The bill arises from the need to repeal the sunset clause, section 33AA of the HOSC Act, which will cease as from 1 July 2006. Unless section 33AA of the HOSC Act is repealed before 1 July 2006, compensation claimants will no longer have access to the majority proportion of compensation money at the time of their judgment or settlement. The HOSC Act allows compensation payers and insurers to pay 10 per cent of the judgment or settlement to Medicare Australia and the balance of the judgment or settlement to be released to the claimant by the courts, under division 2A, advanced payment option to the Commonwealth, under the HOSC Act. This provision will cease if section 33AA is not repealed. Of the 50,000 judgments or settlements reported under the HOSC Act each year, more than 80 per cent utilise the advanced payment option.

Other minor technical amendments are also included in this bill. The minor amendments are designed to clarify the original intent of the act, provide a formal review pathway and make the act consistent. The other amendments relate to:

  • The definition of fatal injury being removed because currently persons who are fatally injured and incur any Medicare, nursing home or residential care expenses are required to comply with the HOSC Act. The removal of the clause leaves no doubt as to the obligation incurred by compensation payers, insurers and claimants if Medicare, nursing home or residential care expenses have been incurred,
  • Aligns paragraph 17(6)(a) with paragraph 23(3)(b) which uses the date of injury as a trigger for recovery action relating to previous Commonwealth expenditure on Medicare, nursing home or residential care. This allows Medicare Australia a 60-day period to provide a history statement if the date of injury was greater than five years old,
  • Provides a formal pathway to allow claimants to have their notice of claim reviewed by Medicare Australia where an informal system currently exists, and
  • Provides a clarification of the value of a ‘small amount’ to align the provisions of the HOSC Act with the definition of a ‘small amount’ in section 38(2) of the HOSC Act.

This bill ensures the continuation of an effective mechanism for recovering funds where a person would otherwise ‘double dip’ while still allowing compensation recipients access to the majority of their funds. I commend the bill to the House and present the explanatory memorandum.

Debate (on motion by Mr Bevis) adjourned.