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Health Legislation Amendment (Medicare and Private Health Insurance) Bill 2003
Schedule 2 Concessional safety-net

   

Health Insurance Act 1973

1  Subsection 8(1A)

Insert:

concessional person : a person is a concessional person in relation to a year at all times after the first time in that year that the person is a concessional beneficiary for the purposes of Part VII of the National Health Act 1953 (which deals with pharmaceutical benefits).

2  Subsection 8(1A)

Insert:

concessional safety-net amount means $500.

Note:          The concessional safety-net amount is indexed under section 10A.

3  Subsection 8(1A) (paragraph (b) of the definition of patient contribution )

Omit “10AC or 10AD”, substitute “10AC, 10ACA, 10AD or 10ADA”.

4  Subsection 8(1A) (at the end of the definition of safety-net amount )

Add:

Note:          The safety-net amount is indexed under section 10A.

5  Section 9

After “this Part”, insert “(other than sections 10ACA and 10ADA)”.

6  Paragraph 10AB(1)(d)

After “10AC”, insert “or 10ACA”.

7  Paragraph 10AB(2)(d)

After “10AC”, insert “or 10ACA”.

8  Subsection 10AB(2)

Omit “section 10AD”, substitute “sections 10AD and 10ADA”.

9  Subsection 10AB(2)

Omit “dealt with under section 10AC”, substitute “dealt with under sections 10AC and 10ACA”.

10  Paragraph 10AB(3)(b)

After “10AC”, insert “or 10ACA”.

11  Paragraph 10AB(3)(e)

Omit “section 10AC”, substitute “sections 10AC and 10ACA”.

12  After subsection 10AC(2)

Insert:

          (2A)  The patient contributions under subparagraph (2)(c)(ii) (including for the purpose of subparagraph (2)(c)(iii)) are to be reduced by so much of those patient contributions as have been paid as increased benefits under section 10ACA. For this purpose, an amount of a patient contribution is taken to have been paid as an increased benefit under section 10ACA to the extent that the amount of the increase in the benefit payable for the relevant service exceeds the difference between the total medical expenses incurred in respect of the relevant service and the Schedule fee for the relevant service.

13  After section 10AC

Insert:

10ACA   Concessional safety-net—families with concessional members

             (1)  In this section:

relevant service means a service:

                     (a)  in respect of which benefit is payable; and

                     (b)  the medical expenses in respect of which exceed the amount of benefit that, apart from this section, would be payable in respect of the service;

but does not include a service of the kind referred to in subparagraph (a)(ii) and paragraph (b) of the definition of applicable benefits arrangement in subsection 5A(1) of the National Health Act 1953 .

year means a calendar year.

             (2)  Subject to this Act, if this section applies to a claim (the current claim ), the benefit payable in respect of the claim is increased by 80% of the out-of-pocket expenses for the current claim.

             (3)  The out-of-pocket expenses for a claim are:

                     (a)  the medical expenses incurred in respect of a relevant service for which the claim is made;

reduced by:

                     (b)  any amounts payable under any other section of this Act in respect of those expenses.

             (4)  This section applies to the current claim if:

                     (a)  the current claim is a claim that is made by a claimant for a benefit in respect of a relevant service which was rendered to the claimant or to a member of the claimant’s registered family; and

                     (b)  the medical expenses incurred in respect of the relevant service are incurred in a year (the expense year ); and

                     (c)  the claimant has paid at least 20% of the out-of-pocket expenses for the service directly to the person by whom, or on whose behalf, the service was rendered; and

                     (d)  the current claim is accepted by the Commission; and

                     (e)  the person to whom the service was rendered is a concessional person in relation to the expense year at the time that the claim is made; and

                      (f)  the concessional safety-net applies to the current claim.

Note:          Subsection 10AC(3) deals with a person being a member of more than one family.

             (5)  The concessional safety-net applies to the current claim if the Commission is satisfied at the time when the current claim was accepted for payment that the sum of the out-of-pocket expenses for the current claim and all relevant prior claims for the expense year is equal to or exceeds the concessional safety-net amount.

             (6)  A claim is a relevant prior claim for the expense year if:

                     (a)  the claim has been made for benefit in respect of relevant services which were rendered to any member of the family who is a concessional person in relation to the expense year at the time that the current claim is made; and

                     (b)  the claim is related to medical expenses incurred during the expense year; and

                     (c)  the claim was accepted for payment by the Commission before the time when the current claim was accepted for payment; and

                     (d)  the Commission is satisfied at the time when the current claim was accepted for payment that the out-of-pocket expenses for the claim have been paid.

             (7)  If:

                     (a)  this section applies to the current claim; but

                     (b)  the sum of the out-of-pocket expenses for all relevant prior claims for the expense year is less than the concessional safety-net amount;

the benefit payable in respect of the claim is not increased under subsection (2) but is instead increased by the amount worked out using the formula:

where:

balance of safety-net means the amount by which the sum of the out-of-pocket expenses for all relevant prior claims for the expense year is less than the concessional safety-net amount.

             (8)  This section applies only to a benefit that becomes payable after a family becomes registered, even though expenses incurred before the registration in the year the family becomes registered may be taken into account for the purposes of determining whether the concessional safety-net applies.

             (9)  For the purposes of this section (other than paragraph (4)(c)), without affecting the meaning of an expression in any other provision of this Act, if a person to whom benefit is payable in respect of a relevant service is given or sent a cheque under subsection 20(2) for the amount of the benefit, the person is taken to have paid so much of the medical expenses in respect of that service as is represented by the amount of the benefit.

           (10)  For the purposes of this section, without affecting the meaning of an expression in any other provision of this Act, despite anything else in this Act, the question when medical expenses are incurred in respect of relevant services relating to prescribed items is to be determined under the regulations.

14  After subsection 10AD(3)

Insert:

          (3A)  The patient contributions under subparagraph (3)(c)(ii) (including for the purpose of paragraph (3)(c)(iii)) are to be reduced by so much of those patient contributions as have been paid as increased benefits under section 10ADA. For this purpose, an amount of a patient contribution is taken to have been paid as an increased benefit under section 10ADA to the extent that the amount of the increase in the benefit payable for the relevant service exceeds the difference between the total medical expenses incurred in respect of the relevant service and the Schedule fee for the relevant service.

15  After section 10AD

Insert:

10ADA   Concessional safety-net—individuals

             (1)  Expressions used in this section have the same meaning as in section 10ACA.

             (2)  Subject to subsection 10AB(3), this section applies to a person who is not a member of a registered family.

             (3)  Subject to this Act, if this section applies to a claim (the current claim ), the benefit payable in respect of the claim is increased by 80% of the out-of-pocket expenses for the current claim.

             (4)  The out-of-pocket expenses for a claim are:

                     (a)  the medical expenses incurred in respect of a relevant service for which the claim is made;

reduced by:

                     (b)  any amounts payable under any other section of this Act in respect of those expenses.

             (5)  This section applies to the current claim if:

                     (a)  the current claim is a claim that is made by the person for a benefit in respect of a relevant service which was rendered to the person; and

                     (b)  the medical expenses incurred in respect of the relevant service are incurred in a year (the expense year ); and

                     (c)  the person has paid at least 20% of the out-of-pocket expenses for the service directly to the person by whom, or on whose behalf, the service was rendered; and

                     (d)  the current claim is accepted by the Commission; and

                     (e)  the person is a concessional person in relation to the expense year at the time that the claim is made; and

                      (f)  the concessional safety-net applies to the current claim.

             (6)  The concessional safety-net applies to the current claim if the Commission is satisfied at the time when the current claim was accepted for payment that the sum of the out-of-pocket expenses for the current claim and all relevant prior claims for the expense year is equal to or exceeds the concessional safety-net amount.

             (7)  A claim is a relevant prior claim for the expense year if:

                     (a)  the claim has been made for benefit in respect of relevant services which were rendered to the person; and

                     (b)  the claim is related to medical expenses incurred during the expense year; and

                     (c)  the claim was accepted for payment by the Commission before the time when the current claim was accepted for payment; and

                     (d)  the Commission is satisfied at the time when the current claim was accepted for payment that the out-of-pocket expenses for the claim have been paid.

             (8)  If:

                     (a)  this section applies to the current claim; but

                     (b)  the sum of the out-of-pocket expenses for all relevant prior claims for the expense year is less than the concessional safety-net amount;

the benefit payable in respect of the claim is not increased under subsection (3) but is instead increased by the amount worked out using the formula:

where:

balance of safety-net means the amount by which the sum of the out-of-pocket expenses for all relevant prior claims for the expense year is less than the concessional safety-net amount.

             (9)  For the purposes of this section (other than paragraph (5)(c)), without affecting the meaning of an expression in any other provision of this Act, if a person to whom benefit is payable in respect of a relevant service is given or sent a cheque under subsection 20(2) for the amount of the benefit, the person is taken to have paid so much of the medical expenses in respect of that service as is represented by the amount of the benefit.

           (10)  For the purposes of this section, without affecting the meaning of an expression in any other provision of this Act, despite anything else in this Act, the question when medical expenses are incurred in respect of relevant services relating to prescribed items is to be determined under the regulations.

16  Subsection 10AE(1)

After “10AC”, insert “or 10ACA”.

17  Subsection 10AE(2)

After “10AC”, insert “or 10ACA”.

18  Subsection 10A(1) (at the end of the definition of year )

Add:

               ; or (d)  for the purpose of the indexation of the concessional safety-net amount—the year beginning on 1 January 2004 or a later year beginning on 1 January.

19  Subsection 10A(2) (at the end of the table)

Add:

4.

The concessional safety-net amount

1 January

September

20  Application

The amendments made by this Schedule apply to expenses incurred on or after 1 January 2004.