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Private Health Insurance Bill 2007

2004-2005-2006

 

The Parliament of the

Commonwealth of Australia

 

HOUSE OF REPRESENTATIVES

 

 

 

 

Presented and read a first time

 

 

 

 

 

 

 

 

 

Private Health Insurance Bill 2006

 

No.      , 2006

 

(Health and Ageing)

 

 

 

A Bill for an Act to regulate private health insurance, and for related purposes

   

   

   



Contents

Chapter 1—Introduction                                                                                        1

Part 1-1—Introduction                                                                                                        1

Division 1—Preliminary                                                                                              1

1-1......... Short title............................................................................................. 1

1-5......... Commencement................................................................................... 2

1-10....... Identifying defined terms.................................................................... 2

Division 3—Overview of this Act                                                                            3

3-1......... What this Act is about......................................................................... 3

3-5......... Incentives (Chapter 2)......................................................................... 3

3-10....... Complying health insurance products (Chapter 3).............................. 3

3-15....... Private health insurers (Chapter 4)...................................................... 3

3-20....... Enforcement (Chapter 5)..................................................................... 4

3-25....... Administration (Chapter 6)................................................................. 4

3-30....... Dictionary (Schedule 1)...................................................................... 4

Division 5—Constitutional matters                                                                        5

5-1......... Meaning of insurance ......................................................................... 5

5-5......... Act not to apply to State insurance within that State............................ 5

5-10....... Compensation for acquisition of property........................................... 5

Chapter 2—Incentives                                                                                                6

Part 2-1—Introduction                                                                                                        6

Division 15—Introduction                                                                                           6

15-1....... What this Chapter is about.................................................................. 6

Part 2-2—Premiums reduction and incentive payments schemes             7

Division 20—Introduction                                                                                           7

20-1....... What this Part is about........................................................................ 7

20-5....... Private Health Insurance (Incentives) Rules........................................ 7

Division 23—Premiums reduction scheme                                                        8

Subdivision 23-A—Amount of reduction                                                              8

23-1....... Reduction in premiums....................................................................... 8

23-5....... Meaning of incentive amount .............................................................. 9

23-10..... Reduction after a person 65 years or over ceases to be covered by policy                10

Subdivision 23-B—Participation in the premiums reduction scheme         11

23-15..... Registration as a participant in the premiums reduction scheme........ 11

23-20..... Refusal to register............................................................................. 12

23-25..... Pre-1999 participants must keep information up to date.................... 12

23-30..... Participants who want to withdraw from scheme.............................. 13

23-35..... Revocation of registration................................................................. 13

23-40..... Variation of registration.................................................................... 14

23-45..... Retention of applications by private health insurers.......................... 14

Division 26—The incentive payments scheme                                               15

Subdivision 26-A—Amount of incentive payment                                            15

26-1....... Payment in relation to premiums....................................................... 15

26-5....... Payment after a person 65 years or over ceases to be covered by policy  16

Subdivision 26-B—Claiming payments under the incentive payments scheme               17

26-10..... Claim for payment under incentive payments scheme....................... 17

26-15..... Withdrawal of claim.......................................................................... 17

26-20..... Determination of claim and payment of amount................................ 18

26-25..... Reconsideration of decision refusing a claim.................................... 18

26-30..... Claimants to keep information up to date.......................................... 19

Part 2-3—Lifetime health cover                                                                                   20

Division 31—Introduction                                                                                         20

31-1....... What this Part is about...................................................................... 20

31-5....... Private Health Insurance (Lifetime Health Cover) Rules................... 20

Division 34—General rules about lifetime health cover                           21

34-1....... Increased premiums for person who is late in taking out hospital cover.. 21

34-5....... Increased premiums for person who ceases to have hospital cover after his or her lifetime health cover base day   21

34-10..... Increased premiums stop after 10 years’ continuous cover............... 22

34-15..... Meaning of hospital cover ................................................................ 23

34-20..... Meaning of permitted days without hospital cover ........................... 24

34-25..... Meaning of lifetime health cover base day ........................................ 24

34-30..... When a person is overseas................................................................ 26

Division 37—Exceptions to the general rules about lifetime health cover            27

37-1....... People born on or before 1 July 1934............................................... 27

37-5....... People over 31 and overseas on 1 July 2000.................................... 27

37-10..... Hardship cases.................................................................................. 27

37-15..... Increases cannot exceed 70% of base rates....................................... 27

37-20..... Joint hospital cover........................................................................... 28

Division 40—Administrative matters relating to lifetime health cover                 29

40-1....... Notification to insured people etc...................................................... 29

40-5....... Evidence of having had hospital cover, or of a person’s age............. 30

Chapter 3—Complying health insurance products                  31

Part 3-1—Introduction                                                                                                      31

Division 50—Introduction                                                                                         31

50-1....... What this Chapter is about................................................................ 31

50-5....... Private Health Insurance (Complying Product) Rules, Private Health Insurance (Prostheses) Rules and Private Health Insurance (Accreditation) Rules........................................................ 31

Part 3-2—Community rating                                                                                         32

Division 55—Principle of community rating                                                  32

55-1....... What this Part is about...................................................................... 32

55-5....... Principle of community rating........................................................... 32

55-10..... Closed products................................................................................ 33

Part 3-3—Requirements for complying health insurance products      34

Division 60—Introduction                                                                                         34

60-1....... What this Part is about...................................................................... 34

Division 63—Basic rules about complying health insurance products    35

63-1....... Obligation to ensure products are complying products..................... 35

63-5....... Meaning of complying health insurance product .............................. 35

63-10..... Meaning of complying health insurance policy ................................. 35

Division 66—Community rating requirements                                             37

66-1....... Community rating requirements........................................................ 37

66-5....... Premium requirement........................................................................ 37

66-10..... Minister’s approval of premiums...................................................... 38

66-15..... Entitlement to benefits for general treatment...................................... 39

66-20..... Different amount of benefits depending on where people live.......... 40

Division 69—Coverage requirements                                                                41

69-1....... Coverage requirements...................................................................... 41

69-5....... Meaning of cover .............................................................................. 41

Division 72—Benefit requirements for policies that cover hospital treatment 42

72-1....... Benefit requirements......................................................................... 42

72-5....... Rules requirement in relation to provision of benefits....................... 44

72-10..... Minimum benefits for prostheses...................................................... 45

72-15..... Ongoing listing fee for prostheses.................................................... 46

Division 75—Waiting period requirements                                                     47

75-1....... Waiting period requirements............................................................. 47

75-5....... Meaning of waiting period ................................................................ 47

75-10..... Meaning of transfers ........................................................................ 48

75-15..... Meaning of pre-existing condition .................................................... 48

Division 78—Portability requirements                                                              50

78-1....... Portability requirements.................................................................... 50

Division 81—Quality assurance requirements                                              52

81-1....... Quality assurance requirements......................................................... 52

Division 84—Enforcement of this Part                                                              53

84-1....... Offence: advertising, offering or insuring under non-complying policies                53

84-5....... Offence: directors and chief executive officers liable if systems not in place to prevent breaches            53

84-10..... Injunction in relation to non-complying policies............................... 54

84-15..... Remedies for people affected by non-complying policies................. 55

Part 3-4—Obligations relating to complying health insurance products   57

Division 90—Introduction                                                                                         57

90-1....... What this Part is about...................................................................... 57

Division 93—Giving information to consumers                                            58

93-1....... Maintaining up to date standard information statements.................... 58

93-5....... Meaning of standard information statement ..................................... 58

93-10..... Making standard information statements available............................ 59

93-15..... Giving information to newly insured people..................................... 59

93-20..... Keeping insured people up to date.................................................... 60

93-25..... Giving advance notice of detrimental changes to rules...................... 61

93-30..... Failure to give information to consumers.......................................... 61

Division 96—Giving information to the Department, the Council and the Private Health Insurance Ombudsman                                                                                           62

96-1....... Giving standard information statements on request........................... 62

96-5....... Giving standard information statements for new products................ 62

96-10..... Giving updated standard information statements............................... 62

96-15..... Giving additional information on request.......................................... 63

96-20..... Failure to give information to Department, Council or Private Health Insurance Ombudsman                63

96-25..... Giving information required by the Private Health Insurance (Complying Product) Rules      64

Division 99—Transfer certificates                                                                       65

99-1....... Transfer certificates........................................................................... 65

Division 102—Private health insurers to offer cover for hospital treatment     67

102-1..... Private health insurers to offer cover for hospital treatment.............. 67

Chapter 4—Private health insurers                                                           68

Part 4-1—Introduction                                                                                                      68

Division 110—Introduction                                                                                      68

110-1..... What this Chapter is about................................................................ 68

Part 4-2—Carrying on health insurance business                                            69

Division 115—Introduction                                                                                      69

115-1..... What this Part is about...................................................................... 69

115-5..... The Private Health Insurance (Health Insurance Business) Rules..... 69

115-10... Whether a business etc. is health insurance business........................ 69

Division 118—Prohibition of carrying on health insurance business without registration          71

118-1..... Carrying on health insurance business without registration.............. 71

118-5..... Injunctions........................................................................................ 71

Division 121—What is health insurance business?                                      73

121-1..... Meaning of health insurance business .............................................. 73

121-5..... Meaning of hospital treatment .......................................................... 74

121-10... Meaning of general treatment ........................................................... 75

121-15... Extension to employee health benefits schemes ................................. 76

121-20... Exception: accident and sickness insurance business........................ 77

121-25... Exception: liability insurance business.............................................. 78

121-30... Exception: insurance business excluded by the Private Health Insurance (Health Insurance Business) Rules         78

Part 4-3—Registration                                                                                                       79

Division 126—Registration                                                                                      79

126-1..... What this Part is about...................................................................... 79

126-5..... The Private Health Insurance (Registration) Rules............................ 79

126-10... Applying for registration................................................................... 79

126-15... Requesting further information......................................................... 80

126-20... Deciding the application.................................................................... 80

126-25... Notifying the decision....................................................................... 82

126-30... Council can be taken to refuse application......................................... 82

126-35... Council to maintain record of registrations etc.................................. 83

126-40... Changing registration status.............................................................. 83

126-45... Cancellation of registration................................................................ 85

Part 4-4—Health benefits funds                                                                                   86

Division 131—Introduction                                                                                      86

131-1..... What this Part is about...................................................................... 86

131-5..... The Private Health Insurance (Health Benefits Fund) Rules............. 86

131-10... Meaning of health benefits fund ........................................................ 86

131-15... Meaning of health-related business .................................................. 87

Division 134—The requirement to have health benefits funds              88

134-1..... Private health insurers must have health benefits funds.................... 88

134-5..... Notifying the Council when health benefits funds are established.... 89

134-10... Inclusion of health-related businesses in health benefits funds......... 89

Division 137—The operation of health benefits funds                               90

137-1..... Assets of health benefits funds......................................................... 90

137-5..... Payments to health benefits funds..................................................... 91

137-10... Expenditure and application of health benefits funds........................ 92

137-15... Effect of non-compliance with section 137-10.................................. 93

137-20... Investment of health benefits funds................................................... 94

137-25... Restriction on restructure, merger, acquisition or termination of health benefits funds             95

137-30... Operation of health-related businesses through health benefits funds 95

Division 140—The solvency standard for health benefits funds           96

140-1..... Purpose of Division.......................................................................... 96

140-5..... Council to establish solvency standard.............................................. 96

140-10... Purpose of solvency standard........................................................... 96

140-15... Compliance with solvency standard.................................................. 97

140-20... Solvency directions........................................................................... 98

Division 143—The capital adequacy standard for health benefits funds               101

143-1..... Purpose of Division........................................................................ 101

143-5..... Council to establish capital adequacy standard................................ 101

143-10... Purpose of capital adequacy standard.............................................. 101

143-15... Compliance with capital adequacy standard.................................... 102

143-20... Capital adequacy directions............................................................. 103

Division 146—Restructure, merger and acquisition of health benefits funds     106

146-1..... Restructure of health benefits funds................................................ 106

146-5..... Merger and acquisition of health benefits funds.............................. 108

Division 149—Termination of health benefits funds                                 110

Subdivision 149-A—Approving the termination of health benefits funds 110

149-1..... Applying for termination................................................................. 110

149-5..... Requesting further information....................................................... 110

149-10... Deciding the application.................................................................. 110

149-15... Council can be taken to refuse application....................................... 111

Subdivision 149-B—Conducting the termination of health benefits funds 111

149-20... Conduct of funds during termination process................................. 111

149-25... Insurers etc. to give reports to Council............................................ 112

149-30... Terminating managers displace management of funds.................... 113

Subdivision 149-C—Ending the termination of health benefits funds       113

149-35... Power to end termination................................................................ 113

Subdivision 149-D—Completing the termination of health benefits funds 114

149-40... Completion of the termination process............................................ 114

149-45... Distribution of remaining assets after completion of the termination process           114

149-50... Liability of officers of insurers for loss to terminated funds........... 114

149-55... Report of terminating manager........................................................ 115

149-60... Applying for winding up................................................................ 115

Division 152—Duties and liabilities of directors etc.                                117

152-1..... Duty and liability of directors in relation to health benefits funds... 117

152-5..... Notices to remedy contraventions................................................... 118

152-10... Liability of directors in relation to non-compliance with notices..... 118

152-15... Council may sue in the name of private health insurers................... 119

152-20... Directors cannot be liable twice for the same act etc........................ 119

Part 4-5—Other obligations of private health insurers                                120

Division 157—Introduction                                                                                    120

157-1..... What this Part is about.................................................................... 120

157-5..... The Private Health Insurance (Insurer Obligations) Rules.............. 120

Division 160—Appointed actuaries                                                                    121

160-1..... Appointment................................................................................... 121

160-5..... Eligibility for appointment............................................................... 121

160-10... Notification of appointment etc....................................................... 122

160-15... Cessation of appointment................................................................ 122

160-20... Compliance with the Private Health Insurance (Insurer Obligations) Rules             122

160-25... Powers of appointed actuary........................................................... 122

160-30... Actuary’s obligations to report........................................................ 123

160-35... Qualified privilege of appointed actuary.......................................... 125

Division 163—Prudential standards                                                                  126

163-1..... Private Health Insurance (Insurer Obligations) Rules to establish prudential standards           126

163-5..... Compliance with prudential standards............................................. 127

163-10... Notice of breaches of prudential standards etc................................ 127

163-15... Directions to comply with standards............................................... 127

163-20... Failure to comply with directions.................................................... 128

Division 166—Disqualified persons                                                                    129

166-1..... Private health insurers not to allow disqualified persons to act as directors              129

166-5..... Disqualified persons must not act for private health insurers.......... 129

166-10... Effect of non-compliance................................................................ 129

166-15... Who is a disqualified person ?......................................................... 129

166-20... Council may disqualify persons...................................................... 130

166-25... Council may determine that persons are not disqualified................. 131

Division 169—Reporting and notification requirements                        133

169-1..... Copies of reports to policy holders................................................. 133

169-5..... Information to be given to the Council annually.............................. 133

169-10... Private health insurers to notify any changes to rules...................... 134

169-15... Private health insurers to notify Department and Council about current chief executive officer               134

Division 172—Miscellaneous                                                                                 136

172-1..... Private health insurers to comply with Council’s requirements....... 136

172-5..... Agreements with medical practitioners............................................ 136

172-10... Private health insurers to give information to Secretary.................. 136

172-15... Restrictions on payment of pecuniary penalties etc......................... 136

Chapter 5—Enforcement                                                                                   138

Part 5-1—Introduction                                                                                                    138

Division 180—Introduction                                                                                    138

180-1..... What this Chapter is about.............................................................. 138

Part 5-2—General enforcement methods                                                             139

Division 185—What this Part is about                                                             139

185-1..... Introduction..................................................................................... 139

185-5..... Meaning of enforceable obligation ................................................. 139

185-10... Meaning of Council-supervised obligation ..................................... 140

Division 188—Performance indicators                                                            141

188-1..... Performance indicators.................................................................... 141

Division 191—Explanation of private health insurer’s operations   142

191-1..... Minister or Council may seek an explanation from a private health insurer              142

191-5..... Writer must respond to insurer’s explanation.................................. 143

Division 194—Investigation of private health insurer’s operations 144

194-1..... Minister or Council may investigate a private health insurer........... 144

194-5..... Notice to give information............................................................... 144

194-10... Notice to produce documents.......................................................... 145

194-15... Notice to give evidence................................................................... 146

194-20... Offences in relation to investigation notices.................................... 146

194-25... Authorisation to examine books and records etc............................. 147

194-30... Minister may consult Council......................................................... 147

194-35... Minister or Council must notify outcome of investigation.............. 148

Division 197—Enforceable undertakings                                                       149

197-1..... Minister or Council may accept written undertakings given by a private health insurer           149

197-5..... Enforcement of undertakings.......................................................... 149

Division 200—Ministerial and Council directions                                      151

200-1..... Minister or Council may give directions......................................... 151

200-5..... Direction requirements.................................................................... 152

Division 203—Remedies in the Federal Court                                             153

203-1..... Minister or Council may apply to the Federal Court....................... 153

203-5..... Declarations of contravention.......................................................... 153

203-10... Pecuniary penalty order................................................................... 154

203-15... Compensation order........................................................................ 154

203-20... Adverse publicity order................................................................... 155

203-25... Other order...................................................................................... 155

203-30... Time limit for declarations and orders............................................. 155

203-35... Civil evidence and procedure rules for declarations and orders....... 155

203-40... Civil proceedings after criminal proceedings................................... 156

203-45... Criminal proceedings during civil proceedings............................... 156

203-50... Criminal proceedings after civil proceedings................................... 156

203-55... Evidence given in proceedings for penalty not admissible in criminal proceedings  157

203-60... Minister or Council may require person to assist............................ 157

203-65... Relief from liability for contravening an enforceable obligation...... 159

203-70... Powers of Federal Court................................................................. 160

Division 206—Revoking entitlement to offer rebate as a premium reduction   161

206-1..... Revocation of status of participating insurer................................... 161

Part 5-3—Enforcement of health benefits fund requirements               162

Division 211—Introduction                                                                                    162

211-1..... What this Part is about.................................................................... 162

211-5..... Purpose of this Part......................................................................... 162

211-10... The Private Health Insurance (Health Benefits Fund Enforcement) Rules               163

211-15... Limitation on external management and termination of health benefits funds           163

Division 214—Investigations into affairs of private health insurers 164

214-1..... Investigation of private health insurers by inspectors...................... 164

214-5..... Powers of inspectors....................................................................... 164

214-10... Person may be represented by lawyer............................................. 165

214-15... Compliance with requirements of inspectors................................... 165

214-20... Access to premises.......................................................................... 166

214-25... Reports of inspectors...................................................................... 167

214-30... Dissemination of reports................................................................. 169

214-35... Liability for publishing reports etc.................................................. 169

214-40... Delegation by inspectors................................................................. 170

214-45... Records not to be concealed etc....................................................... 170

Division 217—External management of health benefits funds           171

Subdivision 217-A—Preliminary                                                                        171

217-1..... Purpose of Division........................................................................ 171

217-5..... The basis of the law relating to external management...................... 171

Subdivision 217-B—Appointment of external managers                             172

217-10... Council may appoint external managers.......................................... 172

217-15... Grounds of appointment of external managers................................ 173

217-20... External managers to displace management of funds...................... 173

Subdivision 217-C—Duties and powers of external managers                    174

217-25... Duties of external managers............................................................ 174

217-30... Additional powers of external managers......................................... 174

217-35... Protection of property during external management........................ 175

217-40... Rights of chargee, owner or lessor of property of fund under external management                175

Subdivision 217-D—Procedure relating to voluntary deeds of arrangement                 176

217-45... Matters that may be included in the Private Health Insurance (Health Benefits Fund Enforcement) Rules              176

Subdivision 217-E—External managers’ reports to Council                      177

217-50... External managers to give reports to Council.................................. 177

217-55... Dealing with reports given to the Council....................................... 178

217-60... Court orders in respect of schemes of arrangement......................... 179

Subdivision 217-F—Miscellaneous                                                                     180

217-65... When an external management begins and ends.............................. 180

217-70... Effect of things done during external management of health benefits funds             181

217-75... Disclaimer of onerous property....................................................... 181

Division 220—Ordering the termination of health benefits funds     182

220-1..... Applications by external managers to the Federal Court................. 182

220-5..... Orders made on applications for appointments of terminating managers  182

220-10... Binding nature of Court orders....................................................... 182

220-15... Notice of appointments................................................................... 182

Chapter 6—Administration                                                                             184

Part 6-1—Introduction                                                                                                    184

Division 230—Introduction                                                                                    184

230-1..... What this Chapter is about.............................................................. 184

Part 6-2—Private Health Insurance Ombudsman                                          186

Division 235—Introduction                                                                                    186

235-1..... Principal object of this Part............................................................. 186

235-5..... Private Health Insurance (Ombudsman) Rules............................... 186

Division 238—Establishment and functions                                                  187

238-1..... Establishment of office of Private Health Insurance Ombudsman.. 187

238-5..... Functions of Private Health Insurance Ombudsman....................... 187

Division 241—Complaints                                                                                      189

Subdivision 241-A—Relevant complaints                                                         189

241-1..... Who may make a complaint............................................................ 189

241-5..... Persons against whom complaints may be made............................. 189

241-10... Grounds for complaint.................................................................... 189

Subdivision 241-B—Dealing with complaints                                                  190

241-15... Initial receipt of complaint............................................................... 190

241-20... Ways of dealing with complaints.................................................... 190

241-25... Referral to the Australian Competition and Consumer Commission 191

241-30... Referral to other bodies................................................................... 192

241-35... Deciding not to deal with a complaint............................................. 192

Subdivision 241-C—Referral to subjects of complaints                                194

241-40... Referral to the subject of the complaint........................................... 194

Subdivision 241-D—Investigation of complaints                                            195

241-45... Investigation of complaint............................................................... 195

241-50... Minister may direct Private Health Insurance Ombudsman to investigate, or to continue to investigate, a complaint........................................................................................................ 195

Subdivision 241-E—Recommendations and reports                                      196

241-55... Recommendations as a result of referral or investigation................ 196

241-60... Report to Minister on outcome of investigation under Subdivision 241-D              197

Subdivision 241-F—Miscellaneous                                                                     198

241-65... Complainant to be kept informed.................................................... 198

Division 244—Investigations                                                                                 199

Subdivision 244-A—Investigations                                                                     199

244-1..... Initiating investigations................................................................... 199

244-5..... Investigations at Minister’s request................................................. 199

Subdivision 244-B—Recommendations and reports                                      200

244-10... Recommendations as a result of investigation................................. 200

244-15... Report to Minister on outcome of investigations under this Division 201

244-20... Consultation with Australian Competition and Consumer Commission.. 202

Division 247—Mediation                                                                                         203

247-1..... Conducting mediation..................................................................... 203

247-5..... Participation in mediation may be compulsory................................ 203

247-10... Medical practitioners may appoint representatives.......................... 204

247-15... Conduct of compulsory mediation.................................................. 205

247-20... Admissibility of things said in mediation........................................ 205

247-25... Appointment of mediators............................................................... 206

Division 250—Information-gathering                                                              207

250-1..... Information-gathering..................................................................... 207

250-5..... Limits on information-gathering...................................................... 209

250-10... Disclosure of personal information................................................. 209

Division 253—Provisions relating to the Private Health Insurance Ombudsman           211

253-1..... Appointment of the Private Health Insurance Ombudsman............ 211

253-5..... Validity of appointments................................................................. 211

253-10... Acting appointments....................................................................... 211

253-15... Remuneration and allowances......................................................... 212

253-20... Outside employment....................................................................... 212

253-25... Leave of absence............................................................................. 212

253-30... Resignation..................................................................................... 213

253-35... Termination of appointment............................................................ 213

253-40... Disclosure of interest by Private Health Insurance Ombudsman.... 214

253-45... Statutory agency etc. for purposes of Public Service Act................ 214

253-50... Annual report.................................................................................. 214

253-55... Delegation....................................................................................... 215

253-60... Private Health Insurance Ombudsman and staff not personally liable 215

Division 256—Miscellaneous                                                                                 216

256-1..... Protection from civil actions............................................................ 216

256-5..... Victimisation................................................................................... 216

256-10... Giving information about the Private Health Insurance Ombudsman 216

Part 6-3—Private Health Insurance Administration Council                  218

Division 261—Introduction                                                                                    218

261-1..... What this Part is about.................................................................... 218

261-5..... The Private Health Insurance (Council) Rules................................ 218

Division 264—Continuation, purposes, functions and powers            219

264-1..... Continuation of the Council............................................................ 219

264-5..... Objectives of the Council................................................................ 219

264-10... Functions of the Council................................................................. 220

264-15... Report on private health insurers..................................................... 222

264-20... Powers............................................................................................ 223

264-25... Directions by Minister.................................................................... 223

Division 267—Constitution and administration                                          224

267-1..... Constitution of the Council............................................................. 224

267-5..... Appointment of members................................................................ 224

267-10... Meetings of the Council.................................................................. 224

267-15... Delegation by the Council............................................................... 225

267-20... Modification of the Commonwealth Authorities and Companies Act 1997               225

Division 270—Members                                                                                           226

270-1..... Terms and conditions etc................................................................. 226

270-5..... Validity of appointments................................................................. 226

270-10... Acting Commissioner..................................................................... 226

270-15... Deputy Commissioner to act as Commissioner in certain circumstances  227

270-20... Powers and duties of persons acting as Commissioner................... 227

270-25... Remuneration and allowances of members..................................... 228

270-30... Leave of absence............................................................................. 228

270-35... Resignation..................................................................................... 229

270-40... Termination of appointment............................................................ 229

270-45... Disclosure of interests..................................................................... 230

Division 273—Chief Executive Officer and staff                                        231

273-1..... Chief Executive Officer................................................................... 231

273-5..... Duties of Chief Executive Officer................................................... 231

273-10... Conflict of interests......................................................................... 231

273-15... Staff and consultants....................................................................... 232

273-20... Remuneration and allowances of Chief Executive Officer.............. 232

273-25... Leave of absence of Chief Executive Officer.................................. 233

Part 6-4—Administration of premiums reduction and incentive payments schemes        234

Division 276—Introduction                                                                                    234

276-1..... What this Part is about.................................................................... 234

Division 279—Provisions applying only to premiums reduction scheme              235

Subdivision 279-A—Reimbursement of private health insurers for premiums reduced under scheme   235

279-1..... Participating insurers may claim reimbursement............................. 235

279-5..... Participating insurers....................................................................... 235

279-10... Requirements for claims.................................................................. 236

279-15... Amounts payable to the private health insurer................................. 236

279-20... Notifying private health insurers if amount is not payable.............. 236

279-25... Additional payment if insurer claims less than entitlement.............. 237

279-30... Additional payment if insurer makes a late claim............................ 237

279-35... Content and timing of application.................................................... 238

279-40... Decision on application................................................................... 238

279-45... Reconsideration of decisions........................................................... 239

Subdivision 279-B—Powers of Medicare Australia CEO in relation to participating insurers                 240

279-50... Audits by Medicare Australia CEO................................................ 240

279-55... Medicare Australia CEO may require production of applications... 241

Division 282—Provisions applying to premiums reduction scheme and incentive payments scheme   243

Subdivision 282-A—When and how payments can be recovered               243

282-1..... Recovery of payments..................................................................... 243

282-5..... Interest on amounts recoverable...................................................... 244

282-10... Medicare Australia CEO may set off debts against amounts payable 245

282-15... Reconsideration of certain decisions under this Division................ 246

Subdivision 282-B—Miscellaneous                                                                    247

282-20... Notification requirements—private health insurers......................... 247

282-25... Use etc. of information relating to another person........................... 248

282-30... Information to be provided to the Commissioner of Taxation......... 248

282-35... Delegation....................................................................................... 249

282-40... Appropriation.................................................................................. 249

Part 6-5—External managers and terminating managers                         250

Division 287—Introduction                                                                                    250

287-1..... What this Part is about.................................................................... 250

287-5..... The Private Health Insurance (Management) Rules........................ 250

Division 290—Powers of managers                                                                   251

290-1..... Powers of managers........................................................................ 251

290-5..... Officers etc. not to perform functions etc. while fund is under management            251

290-10... Managers act as agents of private health insurers............................ 252

Division 293—Information concerning, and records and property of, health benefits funds    253

293-1..... Directors etc. to help managers....................................................... 253

293-5..... Managers’ rights to certain records................................................. 254

293-10... Only manager can deal with property of fund under management.. 255

293-15... Order for compensation where officer involved in void transaction 256

Division 296—Provisions incidental to appointment of managers   258

296-1..... Remuneration of managers.............................................................. 258

296-5..... Council may give directions to managers........................................ 258

296-10... Termination of appointments of managers...................................... 258

296-15... Acts of managers valid etc.............................................................. 259

296-20... Indemnity........................................................................................ 260

296-25... Qualified privilege........................................................................... 260

Division 299—Miscellaneous                                                                                 261

299-1..... Time for doing act does not run while act prevented by this Division 261

299-5..... Continued application of other provisions of Act............................ 261

299-10... Modifications of this Act in relation to health benefits funds under management     262

299-15... Order of Court to be binding on all persons.................................... 262

299-20... Jurisdiction of Federal Court........................................................... 262

299-25... Private Health Insurance (Management) Rules dealing with various matters           262

Part 6-6—Private health insurance levies                                                             264

Division 304—Introduction                                                                                    264

304-1..... What this Part is about.................................................................... 264

304-5..... Private Health Insurance (Levy Administration) Rules................... 264

304-10... Meaning of private health insurance levy ....................................... 264

Division 307—Collection and recovery of private health insurance levies          265

307-1..... When private health insurance levy must be paid............................ 265

307-5..... Late payment penalty....................................................................... 266

307-10... Payment of levy and late payment penalty....................................... 266

307-15... Recovery of levy and late payment penalty..................................... 267

307-20... Waiver of late payment penalty for levies other than collapsed insurer levy             267

307-25... Waiver of collapsed insurer levy and late payment penalty for that levy.. 268

Division 310—Returns, requesting information and keeping records 269

310-1..... Returns must be lodged with Council and Department................... 269

310-5..... Insurer must keep records............................................................... 269

310-10... Council may request information from insurer................................ 270

Division 313—Power to enter premises and search for documents 272

313-1..... Authorised officer may enter premises with consent....................... 272

313-5..... Authorised officer may enter premises under warrant..................... 272

313-10... Announcement before entry............................................................ 273

313-15... Executing a warrant to enter premises............................................. 273

313-20... Identity cards................................................................................... 274

Part 6-7—Private Health Insurance Risk Equalisation Trust Fund   276

Division 318—Private Health Insurance Risk Equalisation Trust Fund               276

318-1..... Private Health Insurance Risk Equalisation Trust Fund.................. 276

318-5..... Amounts to be paid into the Risk Equalisation Trust Fund............. 276

318-10... Operation of the Risk Equalisation Trust Fund............................... 277

318-15... Administration of the Risk Equalisation Trust Fund....................... 277

Part 6-8—Disclosure of information                                                                       278

Division 323—Disclosure of information                                                        278

323-1..... Prohibition on disclosure of information......................................... 278

323-5..... Authorised disclosure: official duties.............................................. 278

323-10... Authorised disclosure: sharing information about insurers among agencies            279

323-15... Authorised disclosure: sharing information about insurers other than among agencies            280

323-20... Authorised disclosure: public interest............................................. 280

323-25... Authorised disclosure: by the Secretary or Council if authorised by affected person               281

323-30... Authorised disclosure: court proceedings....................................... 281

323-35... Authorised disclosure: Council’s public information and agency cooperation functions          282

323-40... Offence: disclosure of information obtained by certain authorised disclosures        282

323-45... Offence: soliciting disclosure of information.................................. 282

323-50... Offence: use etc. of unauthorised information................................. 282

323-55... Offence: offering to supply protected information.......................... 283

Part 6-9—Review of decisions                                                                                     284

Division 328—Review of decisions                                                                     284

328-1..... What this Part is about.................................................................... 284

328-5..... AAT review of decisions................................................................ 284

Part 6-10—Miscellaneous                                                                                               289

Division 333—Miscellaneous                                                                                 289

333-1..... Delegation by Minister.................................................................... 289

333-5..... Delegation by Secretary.................................................................. 289

333-10... Approved forms.............................................................................. 289

333-15... Signing approved forms.................................................................. 291

333-20... Private Health Insurance Rules made by the Minister..................... 291

333-25... Private Health Insurance Rules made by the Council...................... 292

333-30... Regulations..................................................................................... 293

Schedule 1—Dictionary                                                                                        294

1............ Dictionary....................................................................................... 294





Schedule 1 Dictionary

Note:       See section 1-10.

   

   

1   Dictionary

                   In this Act:

ADI (authorised deposit-taking institution) means a corporation that is an ADI for the purposes of the Banking Act 1959 .

adult means a person who is not a * dependent child.

applicable benefits arrangement means an applicable benefits arrangement within the meaning of the National Health Act 1953 as in force before 1 April 2007.

appointed actuary , of a private health insurer, means the person holding an appointment by the insurer under section 160-1.

approved form is a form that meets the requirements in section 333-10.

assets , of a * health benefits fund, is defined in subsections 137-1(3) and (4).

authorised disclosure is defined in subsection 323-1(3).

authorised officer is defined in subsection 313-1(1).

base rate is defined in subsection 34-1(2).

capital adequacy direction means a direction given under section 143-20, and includes such a direction as varied under that section.

capital adequacy standard means a standard established under section 143-5.

census day , for a levy, is defined in subsection 310-1(2).

Chief Executive Officer means the Chief Executive Officer of the Council referred to in section 273-1.

chief executive officer , of a private health insurer, is the person who is primarily and directly responsible to the * directors of the insurer for the general and overall management of the insurer.

collapsed insurer levy is defined in paragraph 304-10(a).

Commissioner means the Commissioner of Private Health Insurance Administration referred to in paragraph 267-1(1)(a).

complaints levy is defined in paragraph 304-10(b).

complying health insurance policy is defined in section 63-10.

complying health insurance product is defined in section 63-5.

constitutional corporation means a corporation to which paragraph 51(xx) of the Constitution applies.

Council means the Private Health Insurance Administration Council continued in existence under Part 6-3.

Council administration levy is defined in paragraph 304-10(c).

Council-supervised obligation is defined in section 185-10.

cover has a meaning affected by section 69-5.

declaration of contravention means a declaration under section 203-5.

dependent child means a person:

                     (a)  who is:

                              (i)  aged under 18; or

                             (ii)  a dependent child under the * rules of the private health insurer that insures the person; and

                     (b)  who is not aged 25 or over; and

                     (c)  who does not have a partner.

Deputy Commissioner means the * member (if any) appointed under subsection 267-5(2) to be the Deputy Commissioner.

director has the same meaning as in the Corporations Act 2001 .

disqualified person is defined in section 166-15.

employee health benefits scheme is defined in section 121-15.

enforceable obligation is defined in section 185-5.

external management means management under Division 217 and Part 6-5.

external manager , in relation to a * health benefits fund, means a person appointed under section 217-10 as the external manager of the fund.

Federal Court means the Federal Court of Australia.

fringe benefit means:

                     (a)  a fringe benefit as defined by subsection 136(1) of the Fringe Benefits Tax Assessment Act 1986 ; and

                     (b)  a benefit that would be a fringe benefit (as defined by subsection 136(1) of that Act) if paragraphs (d) and (e) of the definition of employer in that subsection of that Act were omitted.

general treatment is defined in section 121-10.

gold card is defined in subsection 34-15(3).

health benefits fund is defined in section 131-10.

health care provider means:

                     (a)  a person who provides goods or services as, or as part of, * hospital treatment or * general treatment; or

                     (b)  a person who manufactures or supplies goods provided as, or as part of, hospital treatment or general treatment.

health insurance business is defined in Division 121.

health-related business is defined in section 131-15.

holder , of an insurance policy, means a person who is insured under the policy and who is not a * dependent child.

hospital is defined in subsection 121-5(5).

hospital cover is defined in section 34-15.

hospital-substitute treatment means * general treatment that:

                     (a)  substitutes for an episode of * hospital treatment; and

                     (b)  is any of, or any combination of, nursing, medical, surgical, podiatric surgical, diagnostic, therapeutic, prosthetic, pharmacological, pathology or other services or goods intended to manage a disease, injury or condition; and

                     (c)  is not specified in the Private Health Insurance (Complying Product) Rules as a treatment that is excluded from this definition.

hospital treatment is defined in section 121-5.

improper discrimination :

                     (a)  in relation to an insurer who is not a * restricted access insurer—has the meaning given by subsection 55-5(2); and

                     (b)  in relation to a restricted access insurer—has the meaning given by subsection 55-5(2) as affected by subsection 55-5(3).

incentive amount is defined in section 23-5.

incentive payments scheme means the scheme provided for by Division 26.

ineligible for Medicare , in relation to a person, means not an eligible person within the meaning of the Health Insurance Act 1973 .

inspector means a person appointed as an inspector under section214-1, and (except in section 214-40) includes a person exercising powers under a delegation under section 214-40.

insurance is defined in section 5-1.

late payment penalty means a late payment penalty incurred under section 307-5 in respect of a * private health insurance levy.

levy-related document is defined in subsection 313-1(3).

lifetime health cover base day is defined in section 34-25.

makes a capital payment is defined in subsection 137-5(3).

manager , in relation to a * health benefits fund, means an * external manager or * terminating manager of the fund.

medical practitioner means a medical practitioner within the meaning of the Health Insurance Act 1973 .

Medicare Australia CEO means the Chief Executive Officer of Medicare Australia.

medicare benefit means a medicare benefit under Part II of the Health Insurance Act 1973 .

medicare eligibility day is defined in subsection 34-25(3).

member means a member of the Council and includes the * Commissioner.

new arrival is defined in subsection 34-25(2).

occupier , of * premises, includes:

                     (a)  the person in charge or control, or apparently in charge or control, of the premises; or

                     (b)  a person who represents, or apparently represents, that person.

officer , of a private health insurer, means:

                     (a)  a * director of the insurer; or

                     (b)  a * chief executive officer of the insurer; or

                     (c)  a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the insurer.

officer , of a subject of a complaint under Division 241 or an investigation under Division 244, means:

                     (a)  if the subject is an individual—the individual; or

                     (b)  if the subject is a private health insurer—a person who is an * officer of the insurer; or

                     (c)  if the subject is a company within the meaning of the Corporations Act 2001 —a * director of the company; or

                     (d)  if the subject is an incorporated association—a member of the management committee of the association; or

                     (e)  if the subject is an unincorporated entity—a member of the governing body of the entity; or

                      (f)  if the subject is a partnership—a partner in the partnership.

old Schedule 2 is defined in subsection 34-10(5).

overseas has a meaning affected by section 34-30.

participant , in relation to the * premiums reduction scheme, means:

                     (a)  a person who is registered as a participant in the scheme under subsection 23-15(3); or

                     (b)  a person who has applied to be registered as a participant in the scheme under subsection 23-15(1) and whose application has not been refused.

participating insurer means:

                     (a)  a private health insurer approved by the Minister under subsection 279-5(2); or

                     (b)  a private health insurer that has applied under subsection 279-5(1) to be approved and whose application has not been rejected.

permitted days without hospital cover is defined in section 34-20.

personal information means information or an opinion (including information or an opinion forming part of a database), whether true or not, and whether recorded in a material form or not, about an individual whose identity is apparent, or can reasonably be ascertained, from the information or opinion.

policy group , of a * health benefits fund, is defined in subsection 146-1(5).

policy holder , of a * health benefits fund, means a * holder of a policy that is * referable to the fund.

policy liability of a private health insurer means:

                     (a)  a liability that has arisen under an insurance policy; or

                     (b)  a liability that, subject to the terms and conditions of an insurance policy, will arise on the happening of an event, or at a time, specified in the policy.

pre-existing condition is defined in section 75-15.

premises includes the following:

                     (a)  a structure, building, vehicle or vessel;

                     (b)  a place (whether enclosed or built on);

                     (c)  a part of a thing referred to in paragraph (a) or (b).

premiums reduction scheme means the scheme provided for by Division 23.

private health insurance arrangement includes any of the following:

                     (a)  a * private health insurance policy or a * product;

                     (b)  an agreement or arrangement between a private health insurer and a * health care provider;

                     (c)  an agreement or arrangement between a private health insurer and another person (other than a health care provider) that relates to insurance in relation to * hospital treatment or * general treatment;

                     (d)  an agreement or arrangement between two or more health care providers that relates to insurance in relation to hospital treatment or general treatment;

                     (e)  Private Health Insurance (Complying Product) Rules made for the purposes of item 1 or 5 of the table in subsection 72-1(2);

                      (f)  Private Health Insurance (Prostheses) Rules made for the purposes of item 4 of the table in subsection 72-1(2);

                     (g)  an arrangement between a private health insurer and a * private health insurance broker;

                     (h)  an arrangement between a private health insurance broker and a person seeking to become insured under a private health insurance policy.

private health insurance broker means a person:

                     (a)  who deals (otherwise than by carrying on * health insurance business) in insurance policies that * cover * hospital treatment or * general treatment or both; and

                     (b)  who acts on behalf of persons seeking to become insured under those policies.

private health insurance levy is defined in section 304-10.

Private Health Insurance Ombudsman means the Private Health Insurance Ombudsman appointed for the purposes of Part 6-2.

private health insurance policy means an insurance policy that * covers * hospital treatment or * general treatment or both (whether or not it also covers any other treatment).

private health insurer means a person registered under Part 4-3.

product is defined in subsection 63-5(2).

protected information is defined in subsection 323-1(2).

prudential direction means a direction given under section 163-15.

prudential matters is defined in subsection 163-1(2).

prudential standard means a standard established under subsection 163-1(1).

records , of a subject of a complaint under Division 241 or an investigation under Division 244, includes any of the following that are in the possession, or under the control, of the subject:

                     (a)  the constitution and * rules of the subject, if the subject is a private health insurer;

                     (b)  the internal training manuals and related documents of the subject;

                     (c)  any documents relevant to a * private health insurance arrangement to which the subject is a party or that applies to the subject;

                     (d)  to the extent that the complaint or investigation relates to the subject’s dealings with a particular person—the subject’s records relating to its dealings with that particular person including correspondence, internal memoranda, emails, and recordings of taped conversations;

whenever those records came into existence.

referable : an insurance policy is referable to a * health benefits fund if:

                     (a)  the fund is identified under paragraph 93-15(c) as the fund to which the policy is referable (and the policy has not been made referable to another * health benefits fund under Division 146); or

                     (b)  the policy has been made referable to the fund under Division 146.

registered as a for profit insurer means a private health insurer that is registered under Part 4-3 as a for profit insurer.

relevant amount is defined in subsection 66-10(5).

responsible insurer means:

                     (a)  for a * health benefits fund that is under * external management—the private health insurer that was conducting the fund prior to the appointment of the * external manager of the fund; or

                     (b)  for a health benefits fund that is under * terminating management—the private health insurer that was conducting the fund prior to the appointment of the * terminating manager of the fund.

restricted access group is defined in subsection 126-20(7).

restricted access insurer means a private health insurer that is registered under Part 4-3 as a restricted access insurer.

risk equalisation jurisdiction is defined in subsection 146-1(6).

risk equalisation levy is defined in paragraph 304-10(d).

Risk Equalisation Trust Fund means the Private Health Insurance Risk Equalisation Trust Fund continued in existence under Part 6-7.

rules , of a private health insurer, means the body of rules established by the insurer that relate to the day-to-day operation of the insurer’s * health insurance business and (if any) * health-related business.

schedule fee means the Schedule fee within the meaning of Part II of the Health Insurance Act 1973 .

search powers means powers to search for, inspect, take extracts from, and make copies of, documents.

senior manager of a private health insurer means a person who has or exercises any of the senior management responsibilities (within the meaning of the * prudential standards) for the insurer.

solvency direction means a direction given under section 140-20, and includes such a direction as varied under that section.

solvency standard means a standard established under section 140-5.

standard information statement is defined in section 93-5.

tax file number means a tax file number as defined in section 202A of the Income Tax Assessment Act 1936 .

terminating management means management under Division 149 and Part 6-5.

terminating manager , in relation to the * health benefits funds of a private health insurer, means a person appointed under paragraph 149-10(2)(a) or Division 220 as the terminating manager of the funds.

termination day , in relation to the * health benefits funds of a private health insurer, is defined in subsection 149-20(2).

transfer , in relation to a person, is defined in section 75-10.

up to date , in relation to a * standard information statement, is defined in subsection 93-1(2).

voluntary deed of arrangement means:

                     (a)  a deed of arrangement agreed on at a meeting of a kind referred to in section 217-45; or

                     (b)  such a deed as varied in accordance with the Health Benefits Fund Enforcement Rules.

waiting period is defined in section 75-5.