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Health Legislation Amendment Bill (No. 3) 2001

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1998-1999-2000-2001

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

HEALTH LEGISLATION AMENDMENT BILL (NO. 3) 2001

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Health and Aged Care,

the Hon. Dr Michael Wooldridge, MP)  



 

HEALTH LEGISLATION AMENDMENT BILL (No. 3) 2001

 

OUTLINE

 

THERAPEUTIC GOODS

 

The changes made 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 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 servicesdesignated 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 marketed to the general public in Australia. 

 

The amendments also allow the Secretary to give effect to any other Mutual Recognition Agreements (“MRAs”) entered into between Australia and other countries that provide for arrangements similar to those applying under the Singapore MRA.  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 exported from those countries to Australia meet with Australian requirements.

 

Other changes effected to the Therapeutic Goods Act 1989 will enable the Secretary to obtain information and documents from manufacturers of blood or blood components about their manufacturing processes and practices.  This will enable the Secretary to monitor the manufacturer’s compliance with new standards for blood, and new manufacturing standards for the manufacture of blood and blood components.  Such information or documents may be requested by the Secretary, and provided to the Secretary by manufacturers of blood and blood components without the need for authorised persons to conduct an audit of the manufacturing premises. 

 

The amendments also clarify when the balance of evaluation fees, payable for the evaluation of registrable medicines that are, in the main, prescription medicines, must be paid by applicants seeking to register their medicines in the Australian Register of Therapeutic Goods.   Currently fees are payable when an evaluation of an application to register a medicine in the Register has been completed, and a decision of the Secretary to register, or refuse registration, of a medicine is made and communicated to the applicant.  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 register the medicine, an applicant may withdraw its application.  Where this occurs, the Secretary is not able to recover the cost of the evaluation that has already been completed.  The effect of the amendments is to enable the Secretary to recover the balance of the evaluation fees owing for the evaluation work completed.

 



PROFESSIONAL SERVICES REVIEW

 

The major amendments made by this Schedule amend the provisions of the Professional Services Review (PSR) Scheme in Part VAA of the Health Insurance Act 1973 (the Act) to improve the Scheme’s operation.  

 

The PSR Scheme provides for a system of peer review to determine whether a practitioner has inappropriately rendered or initiated services which attract a Medicare benefit, or has inappropriately prescribed under the Pharmaceutical Benefits Scheme, and to apply sanctions to those found to have practised inappropriately.

 

Following a comprehensive review of the PSR Scheme ( Report of the Review Committee of the Professional Services Review Scheme - March 1999 ), significant legislative amendments to the provisions governing the Scheme were made by the Health Insurance Amendment (Professional Services Review) Act 1999 .  The proposed amendments made by this Schedule are machinery in nature and clarify the intention of some of the earlier proposals and will overcome administrative difficulties experienced with the effectiveness and operation of the previous changes.

 

The Bill clarifies the operation of the Scheme in relation to the following matters:

 

·       the Director’s investigation of matters referred by the Health Insurance Commission (the Commission) and a PSR Committee’s consideration of matters referred by the Director of PSR are not limited by reasons stated in referrals;

·       a practitioner who is to be disqualified from Medicare, in respect of the rendering of services, for intentionally refusing or failing to comply with a requirement to produce or give information during the PSR review process will also be disqualified so that any initiated service will also not attract a Medicare benefit;

·       the instrument making the adjudicative referral is a separate instrument to other documents associated with the referral, particularly the report by the Director of PSR to a Committee which must accompany an adjudicative referral;

·       the removal of existing inconsistencies and the operation of the disqualification provisions under the PSR Scheme where a person under review does not comply with a PSR Committee’s request to attend, give evidence and answer questions at a PSR Committee hearing;

·       the provisions of section 105A of the Act, concerning the power of a PSR Committee to require the production of documents or the giving of information during the PSR process, apply to matters referred prior to 1 August 1999 (‘old matters’), the date of commencement of the relevant provisions of the Health Insurance Amendment (Professional Services Review) Act 1999 .

·       the commencement date of 1 August 1999 in relation to other relevant provisions of the Health Insurance Amendment (Professional Services Review) Act 1999 applies to matters referred prior to1 August 1999.

 

 



The Bill overcomes administrative difficulties in the following areas:

 

·       specifying the material or information which may be given by the Director of PSR to the Determining Authority;

·       requiring practitioners disqualified from Medicare under the PSR Scheme to comply with provisions applicable to practitioners otherwise disqualified under the Act, particularly to display a notice of disqualification at their practice location/s;

·       replace an optometrist’s right of appeal of the Minister’s determination to a PSR Tribunal with a right of appeal to the Administrative Appeals Tribunal;

·       technical corrections of incorrect cross-references, from section 106T to 106TA, in a number of provisions relating to the PSR Scheme.

 

 

NUMBER OF COMMISSIONERS OF HEALTH INSURANCE COMMISSION

 

The Bill makes changes to the legislative provisions covering number of Commissioners of the Health Insurance Commission.  Effective in November 2002, the number of Commissioners will reduce by 2 (rather than by the originally intended 4).   There will then be a Commission comprising the Chairperson, the Managing Director and 7 additional Commissioners.

 

 

CHANGED ADMINISTRATIVE LAW ARRANGEMENTS

 

This schedule makes some minor technical amendments to subsection 23D(3) and 23DAA of the Health Insurance Act 1973 which are consequential upon changes to the administrative law arrangements made by the Administrative Review Tribunal Act 2001 (the ART Act).  Subsection 23D(3) and 23DAA are inserted by items 4 and 5 of Schedule 2 and provide for merits review by the Administrative Appeals Tribunal in respect of a decision to refuse to accept an optometrist undertaking.  The ART Act replaces the Administrative Appeals Tribunal with the Administrative Review Tribunal.

 

NATIONAL HEALTH ACT 1953

 

There are two proposed amendments to the National Health Act 1953 .  The first of these relates to ‘employee health benefit schemes’.  Since 1 October 1995, employers conducting such schemes have had three options:

 

·         to register as a health benefits organisation (health fund) under the Act;

·         to terminate the employee health benefits scheme; or

·         to seek a determination from the Minister that their ‘top up’ scheme is not an employee health benefits scheme (and therefore not health insurance business) under subsection 67(4) of the Act.

 

The intention was to ensure that all unregistered health schemes did not infringe the regulatory requirements applying to registered health funds, and in particular did not undermine the principle of community rating.

 

Many employers who contribute directly towards health expenses incurred by their employees have sought a determination under subsection 67(4) of the Act.

 

However, subsection 67(7) of the Act provides that the Minister for Health and Aged Care must not make a determination under section 67(4) if the ‘top up’ scheme is the subject of an agreement to which Part V1B of the Industrial Relations Act 1988 applies.  Part V1B applied to Certified Agreements and Enterprise Agreements.

 

The proposed amendment will remove this bar which is a minor anachronism, as these ‘top up’ schemes do not provide any threat to community rating but rather are beneficial to contributors and to private health insurance generally.

 

The second proposed amendment relates to discounts for health fund payments.  The National Health Act 1953 allows funds to offer discounts where a contributor pays at least six months in advance.  There is no policy justification for not allowing discounts on the quarterly payment of premiums, as the health insurance industry has confirmed that there are administrative savings for health funds from such payments.

 

The bill also contains an amendment to correct a technical deficiency in the Health Insurance Act 1973 .

 

FINANCIAL IMPACT STATEMENT

 

The amendments to the Therapeutic Goods Act 1989 , the National Health Act 1953 and the PSR Scheme have no significant financial impact.  The financial impact of the amendment relating to number of Commissioners of the Health Insurance Commission is small (a reduced anticipated saving from November 2002 of about $60,000 per year). 

 

 



NOTES ON CLAUSES

 

Clause 1 :  This clause states that the short title of the legislation is the Health Legislation Amendment Act (No.3) 2001 .

 

Clause 2 : sets out the commencement dates for the Bill.

 

Subclauses (2) and (3) clarify that should the proposed Therapeutic Goods Amendment (Medical Devices) Act 2001 come into effect either before or after the commencement of the Health Legislation Amendment Act (No.3) 2001 , then relevant definitions for “conformity assessment certificate” will be either repealed or amended, as the case requires. 

 

Subclause (4) provides that Schedule 4 commences either at the time when Parts 4 to 10 of the Administrative Review Tribunal Act 2001 (the ART Act) commence or immediately after the commencement of Schedule 2, whichever occurs later. 

 

Subclause (5) provides that Schedule 6 may have retrospective application, commencing immediately after the commencement of item 15 of Schedule 1 to the Health Legislation Amendment (Medical Practitioners’ Qualifications and Other Measures) Act 2001.  

 

Unless otherwise specified under this clause, the Act commences to operate on the 28 th day after it receives Royal Assent.

 

Clause 3 : has the effect of stating that, subject to clause 2, the Act will be amended in the manner specified in each of the Schedules.

 

 

 

SCHEDULE 1 - THERAPEUTIC GOODS

 

Items 1 and 2 repeal the current definitions for “approved conformity assessment body” and “conformity assessment body”, as both these definitions have been replaced and incorporated by new definitions inserted by Items 5 and 6 of Schedule 1.

 

Item 3 repeals the definition of “conformity assessment certificate”.

 

Item 4 inserts a new definition for “conformity assessment certificate”, to mean a certificate that is issued under section 41EE of the Act.

 

Item 5 inserts a definition for EC/EFTA attestation of conformity , to refer to attestations of conformity that are issued by an EC/EFTA conformity assessment body:

 

-                 in accordance with the EC Mutual Recognition Agreement or the EFTA Mutual Recognition Agreement; and

-                 where the EC/EFTA conformity assessment body has been approved, in writing, to be one by the Secretary for the purposes of the Act.

 



Item 6 inserts a definition for an EC/EFTA conformity assessment body .  This is a Conformity Assessment Body that has been designated as such in one of the following Sectoral Annexes to the EC Mutual Recognition Agreement or the EFTA Mutual Recognition Agreement:

 

(a)            Sectoral Annex (Medical Devices);

(b)           Sectoral Annex (Medicinal Products GMP Inspection and Batch Certification.

 

Items 7 and 9 insert definitions for an “international agreement” for the purposes of the definition of a “ non EC/EFTA MRA ” in Item 9 .  A “ non-EC/EFTA MRA” refers to an international instrument that Australia is bound by, or is a party to, and the purpose of that instrument is to enable parties bound by that instrument to recognise attestations of conformity.  In addition, the instrument must also be one that meets any other requirements prescribed in the Regulations.

 

Item 8 inserts a definition for “ non EC/EFTA attestation of conformity ”.  This means, in relation to a particular non EC/EFTA MRA, an attestation of conformity issued by a Conformity Assessment Body, after that non EC/EFTA MRA comes into effect, where the Conformity Assessment Body:

 

-                 is designated as such under that non EC/EFTA MRA; and

-                 is approved in writing by the Secretary to be a Conformity Assessment Body for that particular non EC/EFTA MRA.

 

Item 10 inserts new section 3B into the Act.  New s.3B will enable the Minister to declare, in writing, that a country specified in the declaration is covered by the particular MRA, being a non EC/EFTA MRA, identified in the Minister’s declaration.  A declaration made by the Minister under s.3B must be gazetted.

 

Items 12, 14 and 16 amend sections 25, 26 and 26A of the Act.  These sections deal with criteria that must be satisfied before different classes of therapeutic goods may be included in the Australian Register of Therapeutic Goods (“the Register”).  Except in certain circumstances set out in the Act, unless therapeutic goods have been included in the Register by their sponsors, they may not be imported, exported, manufactured or supplied in Australia for use in humans.  Section 25 sets out the criterion that must be satisfied before “registrable therapeutic goods” may be included in the Register.  “Registrable” therapeutic goods refer to higher risk therapeutic goods, such as prescription medicines or implantable therapeutic devices, that require a higher level of scrutiny before they may be included in the Register.  Section 26 sets out criteria that must be satisfied before listable therapeutic devices, or export only therapeutic goods, including export-only medicines, may be included in the Register.  “Listable” therapeutic goods refer to low risk therapeutic goods, such as over the counter medicines and most therapeutic devices, that may be entered into the Register with a level of assessment commensurate with their status as low risk products.  Section 26A sets out the criteria for including listable medicines in the Register.  “Listable medicines” covered by section 26A are in the main over the counter medicines or complementary medicines, such as traditional Chinese medicines and herbal remedies.

 

One common criterion applying under sections 25, 26 and 26A of the Act (which specifies how different classes of therapeutic goods may be included in the Register) relates to whether or not the therapeutic goods that are the subject of an application under those provisions, and that are manufactured outside of Australia, meet with acceptable manufacturing standards. 

 

In relation to section 25, where an application is lodged to register a medicine in the Register and the medicine has been manufactured in a country covered by a non EC/EFTA MRA, Item 12 inserts a new provision, subparagraph 25(2)(a)(ia), into s.25 to enable the Secretary to accept attestations of conformity issued by a Conformity Assessment Body designated as such under that non EC/EFTA MRA for that country.  The Conformity Assessment body must also have been approved in writing by the Secretary to be a conformity assessment body for that non EC/EFTA MRA.  The attestation of conformity is an attestation that the medicine which is the subject of a s.25 application under the Act has been manufactured to an acceptable standard.  The attestation can only be made in relation to that step of manufacture that occurred in the country covered by the non EC/EFTA MRA.  The Secretary is entitled to take into account the attestation for the purposes of deciding whether the medicine satisfies the criterion relating to acceptable manufacturing standards.

 

Item 14 has the same effect as Item 12.  Item 14 inserts a new subparagraph 26(2)(a)(ia) into the Act.  Where an application is lodged to list in the Register listable therapeutic devices, and the devices have been manufactured in a country that is covered by a non EC/EFTA MRA, new subparagraph 26(2)(a)(ia) will enable the Secretary to accept attestations of conformity issued by a Conformity Assessment Body designated as such under that non EC/EFTA MRA for that country.  The Conformity Assessment body must also have been approved in writing by the Secretary to be a conformity assessment body for that non EC/EFTA MRA.  The attestation of conformity is an attestation that the therapeutic device which is the subject of a s.26 application under the Act has been manufactured to an acceptable standard.  The attestation can only be made in relation to that step of manufacture that occurred in the country covered by the non EC/EFTA MRA.  The Secretary is entitled to take into account the attestation for the purposes of deciding whether the device satisfies the criterion relating to acceptable manufacturing standards.

 

Item 16 also has the same effect as Item 12.  Item 16 inserts a new paragraph 26A(4)(a)(ia) into the Act.  Where an application is lodged to include listable medicines in the Register under s.26A of the Act, and the medicine is manufactured in a country that is covered by a non EC/EFTA MRA, new paragraph 26A(4)(a)(ia) will enable the Secretary, in deciding whether to certify that the manufacturing and quality control procedures used in the manufacture of that medicine is acceptable, to take into account whether the applicant has provided a non EC/EFTA MRA attestation of conformity for the step of manufacture undertaken in the country covered by that non EC/EFTA MRA.

 

Items 13 and 15 make consequential changes to remove references, in paragraphs 25B(1)(b) and 26AA(1)(b) of the Act, to a “conformity assessment certificate” and replace these with “an EC/EFTA attestation of conformity”.  These changes reflect the amendments made by Items 3, 4 and 5 of Schedule 1, which repeal the definition for “conformity assessment certificate” to replace it with “EC/EFTA attestation of conformity”.  The term “conformity assessment certificate”, which will be a certificate issued under a proposed provision proposed for insertion in the Act, will only apply in relation to new Chapter 4 of the Act when this is inserted into the Act.

 

Item 11 adds a new subsection 24D(6) into the Act, to clarify when the Secretary may recover from an applicant the balance of evaluation fees that are still outstanding.  Currently, an applicant seeking to include registrable medicines in the Register is only required to pay ¾ of the evaluation fees before the application is processed and evaluated.  The balance of the evaluation fees payable is due following the completion of the evaluation within the timeframe prescribed in the Therapeutic Goods Regulations.  Currently, “completion” is taken to have occurred when an applicant has been notified of the Secretary’s decision on the application under subsection 25(3) of the Act. 

 

The evaluation process adopted for the evaluation of registrable medicines involves the preparation of evaluation reports well before the applicant is notified of a decision.   The contents of these reports, including the recommendations of an expert committee that advises the Secretary on matters that include applications to register medicines in the Register, are made known to the applicant.  This process keeps the applicant informed of the progress of its application and affords an opportunity for the applicant to make any additional submissions.  However, where evaluation reports have been prepared and its contents notified to the applicant, the applicant could withdraw its application at that point, before the Secretary makes a decision based on the evaluation reports and the recommendations of an expert committee.  This usually occurs where the reports themselves, or the recommendations of an expert committee, indicate a possible unfavourable outcome for the applicant.  To enable the Secretary to still recover the evaluation fees for the evaluation reports prepared in the event the applicant does withdraw before being notified of the Secretary’s decision on the application, the amendment effected by Item 11 will enable the Secretary to recover the balance of any outstanding prescribed evaluation fees owing by the applicant for its application.

 

Item 17 inserts a requirement for an applicant for a manufacturing licence to provide certain information.  Where the applicant proposes to carry out any steps in the manufacture of blood or blood components and applies for a licence to do so, the application must contain information relating to any of those steps that may be prescribed in the regulations

 

Item 18 inserts a new condition that applies to a licence issued to a licensee who carries out, or proposes to carry out, any step of manufacture of blood or blood components, and the regulations prescribe information that may be required that relates to those steps of manufacture.  Where the Secretary requests the information about the steps of manufacture prescribed in the regulations, it is a condition of the licence that the licensee supplies that information to the Secretary.

 

Item 19 clarifies the application of 3 amendments made by Items 11, 17 and 18.  The amendment made to s.24D will apply to all applications made on or after the amendment comes into force

 

The amendment to s.37 of the Act will apply to all applications for licences made on or after the amendment comes into force.

 

The amendment to subsection 40(4) of the Act applies in relation to a request that is made under paragraph 40(4)(a) after Item 18 commences, and the request may be made in relation to any licence, including licenses that were granted before the commencement of Item 18.

 

Item 20 is a transitional provision, and has the effect of preserving conformity assessment bodies that were approved as an “approved conformity assessment body” before the commencement of the Health Legislation Amendment Act (No.3) 2001 by deeming those approvals to be approvals for the purposes of the definition of EC/EFTA attestation of conformity when that definition comes into force.

 

Therapeutic Goods Amendment (Medical Devices) Act 2001

 

Item 21 purports to amend the proposed Therapeutic Goods Amendment (Medical Devices) Act 2001 in the event that Act comes into operation after the Health Legislation Amendment Act (No.3) 2001 commences to operate.  If not, this Item will not have any effect. 

 

The item will amend the definition of “conformity assessment certificate” so that such a certificate is one that is issued under new section 41EE, inserted into the Act by the Therapeutic Goods Amendment (Medical Devices) Act 2001 when it comes into operation.

 

 

 



SCHEDULE 2 - PROFESSIONAL SERVICES REVIEW

 

Item 1  The effect of this provision is to apply the requirements of section 19D to practitioners who become fully disqualified under the PSR arrangements, including that a notice of disqualification is displayed at their practice location/s to ensure patients attending those disqualified practitioners are aware the services do not attract a medicare benefit. 

 

The item amends the definition of “disqualified practitioner’ in subsection 19D(11) to add practitioners who become fully disqualified in accordance with sections 92 and 105 and paragraph 106U(1)(h) and for the purposes of section 106ZPM.

 

Item 2 amends subparagraph 23B(7)(a)(ii) to make a technical correction of a cross-reference from section 106T to section 106TA.

 

Item 3 amends subparagraph 23B(7)(b)(ii) to make a technical correction of a cross-reference from section 106T to section 106TA.

 

Item 4 repeals subsection 23D(2) which provides for a review of the Minister’s determination (relating to optometrists) as defined in subsection 23D(1) under Division 3 of Part VA and specifies the date of effect of a determination made by the Minister.  (Part VA was repealed by the Health Insurance Amendment (Professional Services Review) Act 1999 .)  This Bill provides for a review of the Minister’s determination to be made to the Administrative Appeals Tribunal (Item 5).

 

The item substitutes new subsections 23D(2) and 23D(3).

 

New subsection 23D(2) provides for the Minister’s determination to take effect 28 days after notification of the determination was served on the person.  (This period was that effective under the repealed arrangements).

 

New subsection 23D(3) provides that new subsection 23D(2) operates subject to any order by the Administrative Appeals Tribunal or by a court in relation to an application for review of a determination by the Minister made under new section 23DAA.

 

Item 5 adds new section 23DAA which provides for an application to be made to the Administrative Appeals Tribunal for a review of the Minister’s determination within the meaning of section 23D.

 

Item 6 amends section 23DA (paragraph (e) of the definition of relevant person ) to make a technical correction of a cross-reference from section 106T to section 106TA.

 

Item 7 amends paragraph 23DC(6)(d) to make a technical correction of a cross-reference from section 106T to section 106TA.

 

Item 8 amends paragraph 23DF(7)(c) to make a technical correction of a cross-reference from section 106T to section 106TA.

 



Item 9 amends section 81 (paragraph (a) of the definition of legal services) to clarify that the instrument making the adjudicative referral under section 93 is a separate document to other documents associated with the referral.  (The amendment made by this Item is related to those contained in Items 11 to 16, 19, 20 and subitem 30(1)).

 

Item 10  Section 89 provides for the Director to investigate matters which are the subject of an investigative referral.  This item adds new subsections 89 (3), (4), (5) and (6), the intention of which is to remove doubt that the Director’s investigation may take into account any conduct of a person under review relevant to whether the person may have engaged in inappropriate practice in relation to rendering or initiating the referred services, whether or not the conduct was identified in the reasons for referral or any prior counselling.

 

The conduct that may be investigated is that relevant to the definition of “inappropriate practice” contained in section 82 of the Act. 

 

New subsection 89(3) provides that to avoid doubt the Director may consider the conduct of a person in deciding whether to set up a committee to consider whether the person had engaged in inappropriate practice in connection with rendering or initiating referred services.

 

New subsection 89(4) restricts the conduct that may be considered to the extent that it is in connection with the rendering or initiating of referred services.

 

New subsection 89(5) enables the Director to consider the conduct whether or not it was mentioned in any reasons given by the Health Insurance Commission in the investigative referral under section 86(4)(b) or during any prior counselling of the person under review.

 

New subsection 89(6) specifies those whose conduct may be investigated for the purposes of new subsection 89(3).  The conduct is that of the person under review, a practitioner employed by the person under review or a practitioner employed by a body corporate of which the person under review is an officer.

 

Item 11   Section 93 provides for the setting up of a Committee to consider an adjudicative referral and specifies the documents associated with, and the form and content of, an adjudicative referral.

 

Inserts new subsection 93(1A) the intention of which is to avoid doubt that the instrument making the adjudicative referral (in accordance with subsection 93(1)) need not specify the conduct of the person under review.  Although the Director’s report which, in accordance with existing subsection 93(6), must be attached to the instrument making the adjudicative referral must give reasons for that referral, it is not intended that these reasons in any way limit the conduct which the Committee may consider. (The amendment made by this Item is related to those contained in Items 9, 12 to 16, 19, 20 and subitem 30(1)).

 

Items 12-16 amend subsections 93(3), 93(4), paragraph 93(6)(b), 93(7), and 93(8).  The intention of these amendments is to clarify that the instrument making the adjudicative referral under subsection 93(1) is a separate document to others associated with the adjudicative referral. (The amendment made by this Item is related to those contained in Items 9, 11, 19, 20 and subitem 30(1)).  

 

Item 17 adds new subsection 102(4) which provides that a notice of hearing may require the person under review to appear at a hearing of a Committee and give evidence. Presently, the notice of hearing must require the person under review to attend.  This amendment relates to the amendments made by Item 18.

 

Item 18 repeals sections 104 and 105 and substitutes new sections 104 and 105.

 

New section 104 specifies the consequences of a person under review failing to appear, give evidence or answer questions when required at a Committee hearing.

 

New subsection 104(1) provides that new section 104 has effect if the notice of hearing under new subsection 102(4) (Item 17) requires the person under review to attend and give evidence at a Committee hearing and the person under review fails to appear or appears at the hearing but refuses or fails to give evidence or answer questions.

 

Under new subsection 104(2) the Committee may notify the Director if a practitioner fails to attend a hearing or appears but refuses or fails to give evidence or answer questions. (At present it is mandatory for the Chairperson of a Committee to notify the Director in these circumstances following which the Director of PSR must disqualify the person under review).  The amendment enables the Committee, in deciding whether to notify the Director of PSR, to take into account factors beyond the person under review’s control, for example, a motor accident on the way to the hearing or the death of a close family member around the time of the hearing.

 

New subsection 104(3) provides the Committee with an option to proceed with the hearing or to propose to hold another hearing in accordance with section 102.

 

New subsection 104(4) provides that if the person under review subsequently appears, gives evidence and answers questions at a Committee hearing, then the Committee must advise the Director accordingly and the rights accorded to the person under review by section 103 are reinstated.

 

New subsection 104(5) specifies that the Committee may not notify the Director of a person’s failure to appear or refuse to give evidence or answer questions at a Committee hearing or may not proceed with the hearing if the person under review notifies the Committee that he or she has a medical condition and if the person has complied with any reasonable requirements of the Committee regarding medical examinations which confirm the medical condition.  The circumstances applying under new subsection 104(5) preclude the application of new subsections 104(2) and (3).

 

Under new subsection 104(6) the requirements that the Committee notify the Director of the person’s failure to attend, give evidence or answer questions at a Committee hearing and the exercise of the option by the Committee to hold another hearing do not apply if both the person under review and the Committee believe that answering a question might tend to be self-incriminating for the person under review.

 

New section 105 provides for disqualification of a person under review for failing to appear, give evidence as required or to answer every question when required at a Committee hearing.

 

New subsection 105(1) provides that, if upon receipt of a notice from the Committee under new subsection 104(2) the person under review (who is a practitioner) has failed to appear, give evidence or has refused to answer questions at a Committee hearing, then the Director must fully disqualify the person from Medicare and advise the Commission.

 

Under new subsection 105(2) the Director must revoke the disqualification and advise the Commission of the revocation as soon as practicable after the Director is informed by the Committee under new paragraph subsection 104(4)(e) that the person has appeared, given evidence and answered questions.

 

New subsection 105(3) provides that a disqualified person may request the Committee, in writing, to hold another hearing under section 102 and the Committee must comply with the request as soon as practicable.

 

Under new subsection 105(4) a request by a disqualified person under new subsection 105(3) to hold another hearing must be made no later than 21 days after the day on which a copy of the Committee’s draft report is given to the person under subsection 106KD(3).

 

Items 19 and 20 amend paragraph 106G(2)(a) and subsection 106H(1) to clarify that the instrument making the adjudicative referral under section 93 is separate document to other documents associated with the referral.  (The amendment made by this Item is related to those contained in Items 9, 11-16 and subitem 30(1)).

 

Item 21  Section 106H specifies matters to be considered by a Committee in relation to its consideration of an adjudicative referral.  This item adds new subsections 106H(1A), (1B), (1C) and (1D), the intention of which is to remove doubt that, in reaching its findings whether a person under review has engaged in inappropriate practice, the Committee may take into account any conduct (relevant to the definition of “inappropriate practice” contained in section 82 of the Act) of the person in relation to rendering or initiating the specified services whether or not the conduct was identified in the reasons for the referral or in any prior counselling.

 

New subsection 106H(1A) provides that to avoid doubt the Committee may consider the  conduct of a person in making its findings as to whether the person had engaged in inappropriate practice in connection with the rendering or initiating of some or all of the specified services.

 

New subsection 106H(1B) restricts the conduct which may be considered to the extent that it is in connection with the rendering or initiating of specified services.

 

New subsection 106H(1C) enables the Committee in making its findings to consider the conduct whether or not it was mentioned in any reasons given by the Health Insurance Commission in the investigative referral under paragraph 86(4)(b), in reasons given by the Director of PSR in the report under paragraph 93(6)(a) or during any prior counselling of the person under review.

 

New subsection 106H(1D) specifies those whose conduct may be investigated for the purposes of new subsection 106H(1A).  The conduct is that of the person under review, a practitioner employed by the person under review or a practitioner employed by a body corporate of which the person under review is an officer.

 

Item 22 amends subsection 106H(2) the effect of which is to provide that issues not part of an original adjudicative referral but which are subsequently identified by a Committee during the inquiry process may be sent back to the Director for investigation despite new subsection 106H(1B) inserted by Item 21.

 

Item 23 i nserts new section 106SA, the purpose of which is to provide that the Director may give the Determining Authority information.  Examples of information which might be relevant are the nature and circumstances of any previous conduct of the person that has resulted in a criminal conviction or disciplinary action (by a registering or licensing body), responses to any counselling, ratification of a section 92 agreement, a final determination that has taken effect, and any particular needs of the locality in which the person under review practices.

 

New subsection 106SA(1) provides that the Director may give to the Determining Authority any information the Director considers relevant to the authority making a draft or final determination in accordance section 106U.

 

New subsection 106SA(2) provides that the information must be given by the Director no later than the day on which the Committee’s final report is given to the Determining Authority under subsection 124L(4).  The effect of this provision is that the Determining Authority will consider the information given by the Director at the same time that it has available the Committee’s final report.

 

Under new subsection 106SA(3) the Director must also give to the person under review the information given to the Determining Authority at the time it is provided to the Determining Authority.

 

New subsection 106SA(4) provides that the Determining Authority must consider the information given by the Director in making its draft or final determination in accordance with section 106U.

 

Item 24 amends section 106ZPM by inserting the word “initiated”, the effect of which is to apply the provisions of the section in relation to the not paying of a medicare benefit for services initiated (for example, ordering pathology and diagnostic imaging tests) as well as those rendered by the person under review.

 

Item 25  amends section 106ZPM, which provides that a medicare benefit is not payable in respect of services by a person under review for failing to produce documents, give information and intentionally refusing or failing to comply within a specified period (which in effect  disqualifies the person from medicare) by adding new subsections 106ZPM(2), (3) and (4).

 

New subsection 106ZPM(2) provides that, where the Director considers that subsection 106ZPM(1) applies to stop payment of a medicare benefit, the Director must give such a notice to the person.

 

New subsection 106ZPM(3) provides that the Director must give a copy of the notice to the HIC.

 

Under new subsection 106ZPM(4) the person is to be taken to be fully disqualified for the purposes of section 19D if subsection 106ZPM(1) prevents the payment of a medicare benefit and the Director has given a notice under new subsection 106ZPM(2).

 

Items 26 - 28 amend paragraph 124FAA(2)(a), subsection 124FAA(6) and section 129AD to make technical corrections of cross-references from section 106T to section 106TA.

 

Item 29 - Application

 

Subitem (1) provides that the amendment made to subsection 19D(11) by Item 1 applies to a person who becomes disqualified under the PSR arrangements on or after the commencement of that Item under section 92, section 105 and paragraph 106U(1)(h) or for the purposes of section 106ZPM.

 

Subitem (2) provides that the amendments made by Items 4 and 5 to section 23D and the addition of new section 23DAA apply to determinations made by the Minister after the commencement of item 63 of Schedule 1 to the Health Insurance Amendment (Professional Services Review) Act 1999 at which time the removal of the previous right of appeal to a PSR Tribunal became effective.

 

Subitem (3) applies the provisions of section 23D as amended by Item 4 to determinations made by the Minister after the commencement of item 63 of the Health Insurance Amendment (Professional Services Review) Act 1999 and before the commencement of this subitem.

 

Subitem (4) provides that the amendments made by Items 17 and 18 to sections 102, 104 and 105 apply in relation to hearings held by Committees set up after the commencement of those items.

 

Subitem (5) provides that the amendment made by Items 24 and 25 to section 106ZPM applies in respect of notices under subsections 89B(2) and 105A(2) if the notices were given in relation to an investigative referral made, or a Committee set up, on or after the commencement of that Item.

 

Item 30 - Transitional

 

Subitem (1) is a transitional provision which provides that the meaning of Part VAA prior to the commencement of this item is not affected by the amendments made by Items 9, 11 to 16, 19 and 20.

 

Subitem (2) provides that the Director may give information to the Determining Authority under the amendments made by Item 23 inserting new section 106SA on or after their commencement, in respect of a Committee’s final report which was prepared before the amendments commence.

 



HEALTH INSURANCE AMENDMENT (PROFESSIONAL SERVICES REVIEW) ACT 1999

 

Items 31, 32 and 33 amend the transitional provisions contained in Part 2 of Schedule 1 of the Health Insurance Amendment (Professional Services Review) Act 1999 (the Amendment Act) to clarify the original intention of those provisions. 

 

The amending Act enhanced the Committee’s powers in relation to the production of documents in new section 105A.  Although the Amendment Act generally does not apply to matters referred by the Health Insurance Commission to the Director before its commencement on 1 August 1999, an exception was made in respect of new section 105A and the related sanctions contained in new sections 106ZPM and 106ZPN.  The Explanatory Memorandum to the Amendment Act indicated that the purpose of the amendment was to allow a Committee, in considering an ‘old matter’ to have all the powers and sanctions available to it to obtain documents or information under section 105A.  However, item 67(3) of the Amendment Act does not give effect to this policy intent.  These amendments address this technical defect and ensure the implementation of the original policy intent.

 

Item 31 amends item 65 of the Amendment Act by inserting a reference to new subitem 67(3A).  This is consequential upon the amendment made by item 33.

 

Item 32 amends subitem 67(3) of the Amendment Act to provide that section 105A, in force prior to the amendments made by Item 43 of the Amendment Act, ceases to apply to an ‘old matter’ on or after the commencement of Schedule 2 to the Health Legislation Amendment Act (No. 3) 2001.

 

 

Item 33 amends subitem 67 of Schedule 1 of the Amendment Act by inserting new subsection (3A).  Under new paragraphs (3A)(a) and (b) a Committee may exercise the powers conferred by section 105A concerning the production of documents or the giving of information in relation to an ‘old matter’.

 

Item 34 amends Item 68 of the Amendment Act, by inserting a definition to clarify the commencement of Schedule 1.  The definition clarifies the commencement date for all Items in Schedule 1 (other than Items 8 and 27 relating to medical records) as being 1 August 1999.

 

 

 



Schedule 3 - NUMBER OF COMMISSIONERS OF Health Insurance Commission

 

Item 1 substitutes a reference to “7” Commissioners under paragraph 10(1)(c) of the Health Insurance Commission Act 1973 , for the reference to “5” such Commissioners in Item 81 of Schedule 1 to the Health Insurance Commission (Reform and Separation of Functions) Act 1997 .  Item 81 of the latter Act commences 5 years after Royal Assent to that Act.  When Item 81 commences on 11 November 2002, the Item 1 amendment means that Commission will then comprise the Chairperson, the Managing Director and 7 paragraph 10(1)(c) Commissioners.

 

SCHEDULE 4 - CHANGED ADMINISTRATIVE LAW ARRANGEMENTS

 

Schedule 4 makes some minor technical amendments to subsection 23D(3) and section 23DAA of the Health Insurance Act 1973 (inserted by items 4 and 5 of Schedule 2) which are consequential upon changes to the administrative law arrangements made by the ART Act.

 

SCHEDULE 5 - NATIONAL HEALTH ACT 1953

 

Item 1 repeals subsection 67(7) of the National Health Act 1953 .  This subsection provides that the Minister for Health and Aged Care must not make a determination in relation to employee health benefits schemes where the scheme is the subject of an agreement to which Part V1B of the Industrial Relations Act 1988 applies.  The amendment will have the effect of removing that anachronism and allowing employers to contribute towards health expenses of employees subject to such an agreement.

 

Item 2 will allow health funds to offer discounts where contributors pay three months or more in advance, rather than the current minimum period of six months.

 

SCHEDULE 6 - TECHNICAL CORRECTION

 

Item 1 corrects a reference in the Health Insurance Act 1973 .