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Health Insurance Amendment (New Zealand Overseas Trained Doctors) Bill 2010

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2008-2009

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

HEALTH INSURANCE AMENDMENT

(NEW ZEALAND OVERSEAS TRAINED DOCTORS) BILL 2009

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Health and Ageing, the Hon Nicola Roxon, MP)





HEALTH INSURANCE AMENDMENT

(NEW ZEALAND OVERSEAS TRAINED DOCTORS) BILL 2009

 

OUTLINE

The Health Insurance Amendment (New Zealand Overseas Trained Doctors) Bill 2009 (the Bill) proposes to streamline the operation of section 19AB of the Health Insurance Act 1973 (the HIA) and remove a number of anomalies. 

Section19AB of the HIA came into force through an amendment made to the HIA in 1996.  It provides that Medicare benefits are not payable in respect of professional services provided by (or on behalf of) an overseas trained doctor or a former overseas medical student, except in certain circumstances.  Its purpose was, and remains, to influence distribution of the medical workforce in rural and remote areas of Australia, ensuring communities in rural and remote Australia have appropriate access to medical services.

Overseas trained doctors and former overseas medical students have generally been restricted from providing professional services which attract Medicare benefits for a period of ten years.  That period currently commences on the date that the person becomes both a medical practitioner and a permanent Australian (being an Australian permanent resident or citizen) and is commonly referred to as the ‘ten year moratorium’.  Overseas trained doctors and former overseas medical students may be granted an exemption from these restrictions.  The guidelines issued under section 19AB of the HIA provide that a primary consideration in granting such an exemption is that an applicant must work in a district of workforce shortage.

The main provision proposed in the Bill relates to the removal of current restrictions applicable to New Zealand permanent resident and citizen doctors who have obtained their primary medical education at an accredited medical school in Australian or New Zealand.  The change effectively removes these doctors from the classification of ‘overseas trained doctor’ and ‘former overseas medical student’ in section 19AB of the HIA.

Another important provision proposed in the Bill is the removal of the requirement for overseas trained doctors to have both Australian permanent residency or citizenship and medical registration in order for the ten year moratorium period to commence.

The Bill also introduces a period in which medical practitioners can appeal against the refusal of a section 19AB exemption application or a decision to impose conditions in connection with a granted exemption.

The amendments will apply to certain medical practitioners, that is, some overseas trained doctors and former overseas medical students who are currently subject to section 19AB of the HIA, from 1 April 2010 or on Royal Assent, whichever is the later date.  Following the commencement of the amendments, individuals will not need to apply for a release from a subsection 19AB(3) exemption or moratorium if they will no longer be subject to section 19AB.

Financial Impact Statement

The financial impact of this Bill for the Department of Health and Ageing is small.  It is an anticipated ongoing saving of approximately $0.2 million per annum.



HEALTH INSURANCE AMENDMENT

(NEW ZEALAND OVERSEAS TRAINED DOCTORS) BILL 2009

 

 

NOTES ON CLAUSES

 

Clause 1 - Short Title

This clause provides that the Bill, once enacted, may be cited as the Health Insurance Amendment (New Zealand Overseas Trained Doctors) Act 2009.

 

Clause 2 - Commencement

This clause provides that sections 1 to 3 will commence on Royal Assent and that Schedule 1 will commence on 1 April 2010 or on Royal Assent, whichever is the later date. 

 

This timing will provide sufficient time to ensure that affected medical practitioners are notified of the changes and for Medicare Australia to implement the necessary system changes.

 

Clause 3 - Schedule(s)

Each Act that is specified in a Schedule to this Bill is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item has effect according to its terms. Schedule 1 amends the Health Insurance Act 1973 (the HIA) and provides application provisions.

 

SCHEDULE 1 AMENDMENT TO THE HEALTH INSURANCE ACT 1973

 

Part 1 - Amendments

 

Items 1 and 3

These items amend subsections 19AB(1) and (2) to replace the term ‘former overseas medical student’ with ‘foreign graduate of an accredited medical school’.

 

Section 19AB of the HIA places restrictions on a category of individuals known as former overseas medical students.  This category of individuals is defined in the HIA as persons whose primary medical qualification was obtained from an Australian medical school and who were not Australian citizens or permanent residents when they first enrolled at a medical school located in Australia.  

 

The term ‘former overseas medical student’ is commonly misunderstood and results in significant confusion among doctors.  The term is currently intended to refer to a person who is a foreign person who graduates from an Australian medical school.  The amendments aim to remove this confusion by replacing the term with the new term ‘foreign graduate of an accredited medical school’, which reflects the intended meaning more accurately.  The new definition of this new term is inserted by item 6.



Items 2 and 4

These items amend subparagraphs 19AB(1)(f)(ii) and 19AB(2)(f)(ii) by replacing the reference to the date on which the person ‘became a permanent Australian’ with the date on which the person ‘first became a medical practitioner’. 

 

Section 19AB provides that certain medical practitioners are restricted from providing professional services for which a Medicare benefit is payable for a period of ten years.  If a person becomes a medical practitioner prior to becoming an Australian permanent resident or citizen (permanent Australian), the HIA currently specifies that the ten year period commences from the date on which the person becomes a permanent Australian (paragraphs 19AB(1)(f) and 19AB(2)(f)).  This means that some medical practitioners who were initially temporary resident doctors and who subsequently gained Australian permanent residency or citizenship have been subject to the restrictions in section 19AB for periods significantly in excess of ten years.

 

A significant number of temporary resident doctors, including New Zealand trained doctors, work in districts of workforce shortage for two to five years before gaining Australian permanent residency or citizenship.  When the ten year moratorium is applied to their tenure, these doctors may be obliged to work in a district of workforce shortage for up to fifteen years. 

 

The experience of temporary resident doctors is not in keeping with the original intent of the HIA.  The Supplementary Explanatory Memorandum for the Health Insurance Amendment Bill (No. 2) 1996, clause 3, provides:

 

“19AB(1) - a medical practitioner who is either an overseas trained doctor or an Australian trained doctor who began studies as an overseas full paying student, is required to wait ten years from the date he or she obtains Australian medical registration (ten year moratorium) before they can render services which attract Medicare benefits.  These doctors will be able to take up salaried medical positions for which billing against Medicare is not required (eg. salaried hospital positions).”

 

This amendment proposes that the ten year moratorium will commence from the time the medical practitioner is first registered as a medical practitioner in Australia and will cease after ten years, provided the medical practitioner has become a permanent Australian during that period.

 

It is anticipated that a number of overseas trained doctors will be taken to have completed their ten year moratorium upon the commencement of this amendment.  Documentation will not be required to recognise the status of such persons, that is, the Department of Health and Ageing will not require the special lodgement of any documentation (e.g. visas or citizenship documentation) in support of this change in status.  Such medical practitioners will still be required to have a Medicare provider number for each location at which they practise as this requirement will remain unchanged.

 

If a medical practitioner has not become a permanent Australian before the end of the ten year period after gaining medical registration, the restrictions will remain in force until such time as the medical practitioner gains Australian permanent residency or citizenship.

 

Item 5

This item inserts into subsection 19AB(7) the definition of accredited medical school .  The term means a school located in either Australia or New Zealand that is accredited by the Australian Medical Council (the AMC).  This term is used in the definition of foreign graduate of an accredited medical school (item 6 refers).  

 

Item 6

This item inserts into subsection 19AB(7) the definition of foreign graduate of an accredited medical school (items 1 and 3 refer).  The term means a person who obtains their primary medical qualification from an accredited medical school in Australia or New Zealand, and who was not, at the time he or she enrolled in that school, a New Zealand or Australian citizen or a permanent resident (item 9 also refers).  Consequently, foreign graduates of an accredited medical school will continue to include those persons who were not Australian or New Zealand permanent residents or citizens at the time that they enrolled in an accredited Australian or New Zealand medical school.

 

This definition recognises that the AMC accredits both Australian and New Zealand medical schools and ensures that New Zealand citizens and permanent residents are treated similarly to Australian citizens and permanent residents for the purpose of section 19AB of the HIA.

 

The amendment also addresses that, although New Zealand citizens are generally entitled to stay permanently in Australia on a Special Category Visa, these visas are not permanent visas pursuant to the Migration Act 1958 .  Currently, New Zealand citizens who complete their medical qualifications at Australian medical schools come within the definition of ‘former overseas medical student’ as these students are not Australian permanent residents.  Since eligibility is measured from the time a student enrols in their primary medical degree, obtaining Australian citizenship or permanent residency once such persons have commenced studies offers no relief.

 

The effect of the amendment is that professional services provided by New Zealand permanent residents or citizens who obtained their primary medical degree from an Australian or New Zealand medical school and who had previously been subject to the ten year moratorium or a subsection 19AB(3) exemption, will attract Medicare benefits from the commencement date of the Bill (i.e. 1 April 2010 or on Royal Assent, whichever is the later date).  Such persons will no longer be subject to moratorium periods by operation of section 19AB of the HIA and any subsection 19AB(3) exemptions held by such persons will cease to have effect. 

 

The amendment applies only to section 19AB of the HIA. New Zealand permanent residents and citizens will still need to comply with section 19AA of the HIA.

 

Item 7

This item repeals the definition of former overseas medical student .  This term is no longer used in the HIA as a result of the changes made to subsections 19AB(1) and (2).



Item 8

This item amends the definition of overseas trained doctor in subsection 19AB(7) by including a reference to an accredited medical school. 

 

Many Australian citizens elect to study at New Zealand medical schools.  These medical schools are accredited by the AMC to the same standards as Australian medical schools.  However, as these Australians did not gain their primary medical degree in Australia, they are currently subject to section 19AB of the HIA as they fit within the current definition of overseas trained doctors.

 

The amendment will have the effect of excluding Australian graduates of New Zealand medical schools from the amended definition of overseas trained doctor.  Consequently, graduates of an accredited Australian or New Zealand medical school will not be overseas trained doctors.

 

The amendment takes into account the Department of Health and Ageing’s awareness that overseas trained doctors enter Australia via New Zealand, with the majority of these doctors obtaining New Zealand passports as a result of New Zealand’s different entry and citizenship laws.  It is not intended that this proposed amendment be extended to medical practitioners whose primary medical education was obtained outside of Australia or New Zealand.

 

Item 9

This item amends the definition of permanent Australian to replace the term ‘permanent resident’ with ‘a holder of a permanent visa (within the meaning of the Migration Act 1958 )’.

 

Item 10

This item repeals the definition of permanent resident .  This term is no longer used in section 19AB of the HIA as a result of the changes made to the definition of permanent Australian in subsection 19AB(7) to clarify the meaning of ‘permanent resident’ within section 19AB of the HIA  (item 9 refers).

 

Items 11 and 12

These items insert two new subsections into section 19AC. 

 

Section 19AC of the HIA allows for the review of decisions made under subsection 19AB(3) in respect of applications for an exemption from subsection 19AB(1) or (2).  Section 19AC provides that an individual who has been refused an exemption may apply for a review of that decision by the Minister (or delegate).  Similarly, an applicant may apply for a review of a decision to impose one or more conditions in connection with an exemption under subsection 19AB(4).

 

The Minister (or delegate) must make a decision on the reconsideration within 28 days after receiving the application.  The Minister (or delegate) is taken to have made a decision confirming the original decision if he or she fails to notify the applicant of his or her decision within 28 days after receiving the application for reconsideration.  Following an unsuccessful reconsideration, an application may be made to the Administrative Appeals Tribunal.

 

Currently there is no provision made in section 19AC that stipulates a time limit for seeking a review through section 19AC.  As no time limits are specified, applicants may apply for a review of a decision more than twelve months after the original decision was made by the Minister (or delegate).

 

New subsection 19AC(2A) provides a 90 day period for an applicant to apply for a review of a decision by which the Minister (or delegate) refused to grant an exemption under subsection 19AB(3).  New subsection 19AC(3A) provides a 90 day period for an applicant to apply for a review of a decision by which the Minister (or delegate) imposed conditions in connection with an exemption.  This will have the effect of reducing the likelihood that the conditions relating to the original consideration of the application will have varied significantly prior to the review.  The amendment is also intended to assist in improving management of the review process.

 

In the case of a ‘deemed’ refusal of an exemption application, the effect of the amendment will be that an application for review may be made within the 90 period beginning on the day after the end of the 28 day period referred to in subsection 19AC(2). 

 

Part 2 - Application provisions

 

This Part provides for the application of the amendments made by this Bill.

 

Item 13 - Definitions

This item inserts the definitions of exemption condition decision and exemption refusal decision for interpretation of items 15 and 16.

 

Item 14 - amendment of section 19AB

This item provides for the application of the amendments made by this Bill.

 

This item provides that the amendments to section 19AB of the HIA will apply in relation to professional services provided from 1 April 2010 or Royal Assent, whichever is the later date.

 

Item 15 - exemption refusal decisions

This item provides that subsection 19AC(2A) (inserted by item 12) will apply in relation to exemption refusal decisions (item 13 refers) made on or after 1 April 2010 or Royal Assent, whichever is the later date. 

 

In relation to exemption refusal decisions made prior to the date of commencement, the applicant will have 90 days from the date of commencement to apply for a review.  This means, for example, if a person was given an exemption refusal decision on 1 July 2009 (to which there was previously no time limitation on submitting a review application) that person will have 90 days from the commencement of these amendments to submit a review application. 

 

Item 16 - exemption condition decisions

This item provides that subsection 19AC(3A) (inserted by item 12) will apply in relation to exemption condition decisions (item 13 refers) made on or after

1 April 2010 or Royal Assent, whichever is the later date.



In relation to exemption condition decisions made prior to the date of commencement, the applicant will have 90 days from the date of commencement to apply for a review.  This means, for example, if a person was given an exemption condition decision on 1 July 2009 (to which there was previously no time limitation on submitting a review application) that person will have 90 days from the commencement of these amendments to submit a review application.