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Monday, 23 November 2009
Page: 8605

Senator CORMANN (7:57 PM) —by leave—I move amendments (1) and (2) standing in my name on behalf of the opposition and Senators Fielding and Xenophon:

(1)    Clause 2, page 1 (lines 7 and 8), omit the clause, substitute:

2  Commencement

         (1)    Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

Commencement information

Column 1

Column 2

Column 3




1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table

The day on which this Act receives the Royal Assent.

2.  Schedule 1

1 January 2010

3.  Schedule 2

The day after this Act receives the Royal Assent.

Note:   This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

         (2)    Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

(2)    Page 19 (after line 16), at the end of the bill, add:

Schedule 2—Amendment relating to disallowance of medical services items

Health Insurance Act 1973

1  At the end of section 4


         (3)    If an item in a table of medical services prescribed in accordance with subsection (1) is disallowed under section 42 of the Legislative Instruments Act 2003, the corresponding item, if any, in the previous regulations is taken to apply in place of the disallowed item from the time of disallowance.

         (4)    In subsection (3):

corresponding item means:

              (a)    the item in the previous regulations with the same item number; or

              (b)    if no item satisfies paragraph (a)—the item in the previous regulations covering the same medical services;

as the disallowed item.

previous regulations means the regulations that were in force immediately prior to the commencement of the disallowed item.

2  Application

The amendment made by this Schedule applies in relation to any disallowance after 26 October 2009 of an item in a table of medical services prescribed in accordance with subsection 4(1) of the Health Insurance Act 1973.

Fundamentally, these amendments are designed to address a serious flaw in the way the parliament is able to scrutinise changes in Medicare rebates. The effect of these amendments is the same as that which the Senate pursued through the Health Insurance Amendment (Revival of Table Items) Bill 2009. In the interests of time, I refer you for a more detailed explanation as to what we seek to achieve through these amendments to the second reading speech on that bill.

Specifically, these amendments seek to ensure—as did the private members bill—that the disallowance process is workable in relation to the general medical services tables. At present the situation is that, faced with the government making even the most inappropriate decision to reduce the Medicare rebate, the Senate cannot disallow that reduction in rebates but can only disallow the item number in question itself, with the well-advertised effect—which has been focused on by the Minister for Health and Ageing—that the rebate in that circumstance would go down to zero. If the government wants to reduce patient rebates through Medicare and the Senate disagrees with the government’s actions, the reality is that the Senate should be able to move a disallowance of the reduction not just of the item number. At present that is not the case. As per advice from the Clerk of the Senate, our private members’ bill and, as such, also our amendment, will apply the general rule of revival contained in the Legislative Instruments Act to particular parts of these regulations.

The problem at present is that, if what Minister Roxon is doing is allowed to stand unchallenged and if it can continue to go ahead into the future, it would mean in effect that governments could make any cuts they like to the Medicare Benefits Schedule without the Senate ever being able in practice to stop them—70 per cent, 80 per cent, 90 per cent cuts, and the parliament cannot do anything about it. So, however ill-considered the budget cut, however many senators are opposed to it, however sound and well-considered the reasons for disallowance may be, the Senate would not be able to do anything about it. If this situation were allowed to stand, any disallowance motion in relation to cuts to the Medicare Benefits Schedule now or at any time in the future would be completely ineffective. Clearly that cannot have been the intention of the parliament when delegating the power to make regulations to the government under the Health Insurance Act 1973.

Given that, at present, the Health Insurance Act 1973 appears to delegate power to the government to make regulations reducing any Medicare item rebate without the Senate being able to do anything about it in practice, clearly that legislation needs to be changed. This is the intention of these amendments. On this occasion, it is about elderly patients in need of life-changing cataract surgery, but another time it could be cancer patients, it could be heart patients or it could be patients across a whole range of medical specialties. If the government is able to do what this government has done, in the face of the express and formalised opposition of the Senate as expressed through a disallowance motion, and if the government can proceed without any recourse to the Senate, even if a majority of the Senate disagrees with the government’s action, then that is entirely inappropriate.

In the short term, this amendment is aimed at helping to protect the more than 100,000 elderly patients who access life-changing cataract surgery every year. The Rudd government, through what we consider to be an ill-considered, short-sighted 50 per cent cut in rebates, sought to impose significant additional out-of-pocket expenses onto mostly elderly patients. This amendment will ensure that the disallowance of that measure, which was passed by the Senate on 28 October 2009, will see the rebate for cataract surgery related items revert to the previous level of rebate.

I will quickly talk about the amendments. The most substantial part of the amendments is amendment (2), which provides that, if any item in the table of medical services prescribed in accordance with subsection (1) is disallowed under section 42 of the Legislative Instruments Act 2003, the corresponding item, if any, in the previous regulations is taken to apply in place of the disallowed item from the time of disallowance. The application would be from 26 October 2009.

The changes in amendment (1) relate to the commencement provisions. I note again that commencement of this bill, the Health Insurance Amendment (Compliance) Bill 2009, according to the government and the way it has been drafted, is 1 January 2010, but in order for that to be possible this legislation has to be passed by the end of this week. The opposition has, very constructively, enabled the government to meet its own deadlines, which they have flagged in this legislation, because we all know that, from tomorrow, we will not be dealing with much legislation other than the CPRS legislation.

I will quickly talk about two comments made by the Minister for Health and Ageing, after the Senate passed the Health Insurance Amendment (Revival of Table Items) Bill 2009. Firstly, she claimed that that bill—and, as such, I guess, these amendments, because these amendments are the same as that bill—was unconstitutional, should not have been introduced into the Senate and should not have been passed by the Senate, supposedly because it was a bill appropriating money and, as such, a money bill. Let me be very clear that that argument is incorrect. Advice from the Clerk of the Senate and independent legal advice from Blake Dawson to the AMA very clearly point out that this is not a bill appropriating money and that it was quite appropriately introduced and passed by the Senate—entirely consistent with section 53 of the Constitution.

I note that, even though Minister Roxon, in the House of Representatives on 29 October 2009 promised that she would provide a copy of the government’s legal advice, which supposedly indicated otherwise, so far she has not, despite repeated orders of the Senate. It does raise the question: given that we have been prepared to put all of our advice on the table and that the government promised to provide its advice, what has the government got to hide?

Finally, in her press conference after the Senate passed the disallowance motion and the private members bill, the minister made the observation that, if our private member’s bill were to be passed into law—and presumably those remarks apply equally to these amendments—this would mean that governments would not be able to change or reduce Medicare rebates in the future. That is, of course, completely incorrect. What it does mean is that, if the Senate were opposed to changes or reductions in Medicare rebates which the government wanted to pursue, and chose to express that opposition by passing a disallowance motion, then the government would not be able to reduce or change Medicare rebates. But, if a government were to seek to reduce or change Medicare rebates and were able to make a case to the Senate, as well as to the House of Representatives, that that was justified, then there would be absolutely no problem.

I repeat again that the minister’s assertion that the effect of the bill passed by the Senate, and the effect of these amendments, would be that the government could at no time reduce Medicare rebates in the future is false. But it is very clearly the intention of this amendment, and unashamedly so, that if the Senate is opposed to a particular reduction in Medicare rebates because it considers it to be inappropriate, and if the Senate gives expression to that opposition through a disallowance motion, then clearly the government cannot go ahead with that reduction—nor should it be able to. From our point of view, we think that is Democracy 101 and that the minister should clearly be forced to take note of the Senate’s wishes in those circumstances.

In closing, this has been a very messy exercise. We grant you that. We do not take responsibility for this. The minister has known since 8 September that she did not have a majority in the Senate for these cold-hearted cuts in patient rebates for cataract surgery through Medicare. We are going to have a more substantial debate about why we think the government’s cuts are ill-thought out, ill-considered, short-sighted and very bad for our health system. I will not hold up the Senate with this now, but the reality is that, from a process point of view, the reason these amendments have become necessary is that this is a government that does not take note when the Senate says, ‘We do not agree with what you are doing—go back to the drawing board.’

This minister has form. This minister has shown that she cannot be trusted with the delegated authority that has been granted to the government under the Health Insurance Act 1973. In order to make the disallowance process appropriately effective in practice, these two amendments are necessary. I commend them to the Senate.