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Private Health Insurance Bill 2007

 

 

 

 

 

 

Private Health Insurance Act 2007

 

No. 31, 2007

 

 

 

 

 

An Act to regulate private health insurance, and for related purposes

   

   

   



Contents

Chapter 1—Introduction                                                                                         2

Part 1-1—Introduction                                                                                                           2

Division 1—Preliminary                                                                                               2

1-1......... Short title............................................................................................ 2

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

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

Division 3—Overview of this Act                                                                           4

3-1......... What this Act is about........................................................................ 4

3-5......... Incentives (Chapter 2)........................................................................ 4

3-10....... Complying health insurance products (Chapter 3)............................ 4

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

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

3-25....... Administration (Chapter 6)................................................................ 5

3-30....... Dictionary (Schedule 1)...................................................................... 5

Division 5—Constitutional matters                                                                        6

5-1......... Meaning of insurance ......................................................................... 6

5-5......... Act not to apply to State insurance within that State........................ 6

5-10....... Compensation for acquisition of property......................................... 6

Chapter 2—Incentives                                                                                                7

Part 2-1—Introduction                                                                                                           7

Division 15—Introduction                                                                                           7

15-1....... What this Chapter is about................................................................. 7

Part 2-2—Premiums reduction and incentive payments schemes                8

Division 20—Introduction                                                                                           8

20-1....... What this Part is about....................................................................... 8

20-5....... Private Health Insurance (Incentives) Rules....................................... 8

Division 23—Premiums reduction scheme                                                        9

Subdivision 23-A—Amount of reduction                                                                 9

23-1....... Reduction in premiums....................................................................... 9

23-5....... Meaning of incentive amount ............................................................ 10

23-10..... Reduction after a person 65 years or over ceases to be covered by policy             11

Subdivision 23-B—Participation in the premiums reduction scheme             12

23-15..... Registration as a participant in the premiums reduction scheme..... 12

23-20..... Refusal to register............................................................................. 13

23-25..... Pre-1999 participants must keep information up to date................ 13

23-30..... Participants who want to withdraw from scheme............................ 14

23-35..... Revocation of registration................................................................. 14

23-40..... Variation of registration.................................................................... 15

23-45..... Retention of applications by private health insurers....................... 15

Division 26—The incentive payments scheme                                              16

Subdivision 26-A—Amount of incentive payment                                                16

26-1....... Payment in relation to premiums..................................................... 16

26-5....... Payment after a person 65 years or over ceases to be covered by policy               17

Subdivision 26-B—Claiming payments under the incentive payments scheme   18

26-10..... Claim for payment under incentive payments scheme..................... 18

26-15..... Withdrawal of claim.......................................................................... 18

26-20..... Determination of claim and payment of amount.............................. 19

26-25..... Reconsideration of decision refusing a claim.................................... 19

26-30..... Claimants to keep information up to date........................................ 20

Part 2-3—Lifetime health cover                                                                                    21

Division 31—Introduction                                                                                         21

31-1....... What this Part is about..................................................................... 21

31-5....... Private Health Insurance (Lifetime Health Cover) Rules................. 21

Division 34—General rules about lifetime health cover                           22

34-1....... Increased premiums for person who is late in taking out hospital cover 22

34-5....... Increased premiums for person who ceases to have hospital cover after his or her lifetime health cover base day.......................................................................................................... 22

34-10..... Increased premiums stop after 10 years’ continuous cover............. 23

34-15..... Meaning of hospital cover ................................................................ 24

34-20..... Meaning of permitted days without hospital cover ........................... 25

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

34-30..... When a person is overseas................................................................ 27

Division 37—Exceptions to the general rules about lifetime health cover          28

37-1....... People born on or before 1 July 1934.............................................. 28

37-5....... People over 31 and overseas on 1 July 2000.................................... 28

37-10..... Hardship cases.................................................................................. 28

37-15..... Increases cannot exceed 70% of base rates....................................... 28

37-20..... Joint hospital cover.......................................................................... 29

Division 40—Administrative matters relating to lifetime health cover 30

40-1....... Notification to insured people etc.................................................... 30

40-5....... Evidence of having had hospital cover, or of a person’s age............ 31

Chapter 3—Complying health insurance products                    32

Part 3-1—Introduction                                                                                                         32

Division 50—Introduction                                                                                         32

50-1....... What this Chapter is about............................................................... 32

50-5....... Private Health Insurance Rules relevant to this Chapter.................. 32

Part 3-2—Community rating                                                                                            33

Division 55—Principle of community rating                                                    33

55-1....... What this Part is about..................................................................... 33

55-5....... Principle of community rating.......................................................... 33

55-10..... Closed products................................................................................ 34

Part 3-3—Requirements for complying health insurance products           35

Division 60—Introduction                                                                                         35

60-1....... What this Part is about..................................................................... 35

Division 63—Basic rules about complying health insurance products    36

63-1....... Obligation to ensure products are complying products................... 36

63-5....... Meaning of complying health insurance product .............................. 36

63-10..... Meaning of complying health insurance policy ................................. 37

Division 66—Community rating requirements                                              38

66-1....... Community rating requirements....................................................... 38

66-5....... Premium requirement........................................................................ 38

66-10..... Minister’s approval of premiums.................................................... 40

66-15..... Entitlement to benefits for general treatment................................... 40

66-20..... Different amount of benefits depending on where people live......... 41

Division 69—Coverage requirements                                                                42

69-1....... Coverage requirements...................................................................... 42

69-5....... Meaning of cover .............................................................................. 42

69-10..... Meaning of hospital-substitute treatment .......................................... 43

Division 72—Benefit requirements for policies that cover hospital treatment 44

72-1....... Benefit requirements......................................................................... 44

72-5....... Rules requirement in relation to provision of benefits..................... 46

72-10..... Minimum benefits for prostheses.................................................... 47

72-15..... Ongoing listing fee for prostheses.................................................... 48

72-20..... Other matters.................................................................................... 49

Division 75—Waiting period requirements                                                     50

75-1....... Waiting period requirements............................................................. 50

75-5....... Meaning of waiting period ................................................................ 50

75-10..... Meaning of transfers ........................................................................ 51

75-15..... Meaning of pre-existing condition .................................................... 51

Division 78—Portability requirements                                                               53

78-1....... Portability requirements................................................................... 53

Division 81—Quality assurance requirements                                              55

81-1....... Quality assurance requirements........................................................ 55

Division 84—Enforcement of this Part                                                               56

84-1....... Offence: advertising, offering or insuring under non-complying policies                56

84-5....... Offence: directors and chief executive officers liable if systems not in place to prevent breaches          56

84-10..... Injunction in relation to non-complying policies.............................. 57

84-15..... Remedies for people affected by non-complying policies............... 58

Part 3-4—Obligations relating to complying health insurance products 60

Division 90—Introduction                                                                                         60

90-1....... What this Part is about..................................................................... 60

Division 93—Giving information to consumers                                             61

93-1....... Maintaining up to date standard information statements................. 61

93-5....... Meaning of standard information statement ..................................... 62

93-10..... Making standard information statements available.......................... 62

93-15..... Giving information to newly insured people.................................... 62

93-20..... Keeping insured people up to date................................................... 63

93-25..... Giving advance notice of detrimental changes to rules..................... 64

93-30..... Failure to give information to consumers......................................... 64

Division 96—Giving information to the Department, the Council and the Private Health Insurance Ombudsman                                                                                            65

96-1....... Giving standard information statements on request......................... 65

96-5....... Giving standard information statements for new products.............. 65

96-10..... Giving updated standard information statements............................. 65

96-15..... Giving additional information on request......................................... 66

96-20..... Failure to give information to Department, Council or Private Health Insurance Ombudsman              66

96-25..... Giving information required by the Private Health Insurance (Complying Product) Rules    67

Division 99—Transfer certificates                                                                        68

99-1....... Transfer certificates.......................................................................... 68

Division 102—Private health insurers to offer cover for hospital treatment       70

102-1..... Private health insurers to offer cover for hospital treatment............ 70

Chapter 4—Private health insurers                                                           71

Part 4-1—Introduction                                                                                                         71

Division 110—Introduction                                                                                      71

110-1..... What this Chapter is about............................................................... 71

Part 4-2—Carrying on health insurance business                                               72

Division 115—Introduction                                                                                      72

115-1..... What this Part is about..................................................................... 72

115-5..... The Private Health Insurance (Health Insurance Business) Rules... 72

115-10... Whether a business etc. is health insurance business....................... 72

Division 118—Prohibition of carrying on health insurance business without registration           74

118-1..... Carrying on health insurance business without registration............. 74

118-5..... Injunctions........................................................................................ 74

Division 121—What is health insurance business?                                     76

121-1..... Meaning of health insurance business .............................................. 76

121-5..... Meaning of hospital treatment .......................................................... 77

121-7..... Conditions on declarations of hospitals........................................... 78

121-10... Meaning of general treatment ........................................................... 79

121-15... Extension to employee health benefits schemes ................................ 80

121-20... Exception: accident and sickness insurance business....................... 81

121-25... Exception: liability insurance business............................................. 82

121-30... Exception: insurance business excluded by the Private Health Insurance (Health Insurance Business) Rules       82

Part 4-3—Registration                                                                                                        83

Division 126—Registration                                                                                      83

126-1..... What this Part is about..................................................................... 83

126-5..... The Private Health Insurance (Registration) Rules.......................... 83

126-10... Applying for registration.................................................................. 83

126-15... Requesting further information......................................................... 84

126-20... Deciding the application................................................................... 84

126-25... Notifying the decision...................................................................... 86

126-30... Council can be taken to refuse application....................................... 86

126-35... Council to maintain record of registrations etc................................. 87

126-40... Changing registration status.............................................................. 87

126-42... Conversion to for profit status......................................................... 89

126-45... Cancellation of registration............................................................... 90

Part 4-4—Health benefits funds                                                                                    91

Division 131—Introduction                                                                                      91

131-1..... What this Part is about..................................................................... 91

131-5..... The Private Health Insurance (Health Benefits Fund) Rules........... 91

131-10... Meaning of health benefits fund ........................................................ 91

131-15... Meaning of health-related business .................................................. 92

Division 134—The requirement to have health benefits funds            93

134-1..... Private health insurers must have health benefits funds................... 93

134-5..... Notifying the Council when health benefits funds are established... 94

134-10... Inclusion of health-related businesses in health benefits funds........ 94

Division 137—The operation of health benefits funds                               95

137-1..... Assets of health benefits funds........................................................ 95

137-5..... Payments to health benefits funds................................................... 96

137-10... Expenditure and application of health benefits funds...................... 97

137-15... Effect of non-compliance with section 137-10................................. 98

137-20... Investment of health benefits funds................................................. 99

137-25... Restriction on restructure, merger, acquisition or termination of health benefits funds          100

137-30... Operation of health-related businesses through health benefits funds 100

Division 140—The solvency standard for health benefits funds        101

140-1..... Purpose of Division........................................................................ 101

140-5..... Council to establish solvency standard.......................................... 101

140-10... Purpose of solvency standard........................................................ 101

140-15... Compliance with solvency standard............................................... 102

140-20... Solvency directions......................................................................... 103

Division 143—The capital adequacy standard for health benefits funds                106

143-1..... Purpose of Division........................................................................ 106

143-5..... Council to establish capital adequacy standard.............................. 106

143-10... Purpose of capital adequacy standard............................................ 106

143-15... Compliance with capital adequacy standard.................................. 107

143-20... Capital adequacy directions............................................................ 108

Division 146—Restructure, merger and acquisition of health benefits funds     111

146-1..... Restructure of health benefits funds............................................... 111

146-5..... Merger and acquisition of health benefits funds............................. 113

146-10... Consent of policy holders not required.......................................... 115

146-15... Other laws not overridden.............................................................. 116

Division 149—Termination of health benefits funds                                 117

Subdivision 149-A—Approving the termination of health benefits funds     117

149-1..... Applying for termination............................................................... 117

149-5..... Requesting further information....................................................... 117

149-10... Deciding the application................................................................. 117

149-15... Council can be taken to refuse application..................................... 118

Subdivision 149-B—Conducting the termination of health benefits funds   118

149-20... Conduct of funds during termination process................................ 118

149-25... Insurers etc. to give reports to Council.......................................... 119

149-30... Terminating managers displace management of funds.................... 120

Subdivision 149-C—Ending the termination of health benefits funds           120

149-35... Power to end termination............................................................... 120

Subdivision 149-D—Completing the termination of health benefits funds   121

149-40... Completion of the termination process.......................................... 121

149-45... Distribution of remaining assets after completion of the termination process        121

149-50... Liability of officers of insurers for loss to terminated funds.......... 121

149-55... Report of terminating manager....................................................... 122

149-60... Applying for winding up................................................................ 122

Division 152—Duties and liabilities of directors etc.                               124

152-5..... Notices to remedy contraventions.................................................. 124

152-10... Liability of directors in relation to non-compliance with notices... 124

152-15... Council may sue in the name of private health insurers................. 125

Part 4-5—Other obligations of private health insurers                                  126

Division 157—Introduction                                                                                    126

157-1..... What this Part is about................................................................... 126

157-5..... The Private Health Insurance (Insurer Obligations) Rules............. 126

Division 160—Appointed actuaries                                                                   127

160-1..... Appointment.................................................................................. 127

160-5..... Eligibility for appointment............................................................. 127

160-10... Notification of appointment etc..................................................... 128

160-15... Cessation of appointment.............................................................. 128

160-20... Compliance with the Private Health Insurance (Insurer Obligations) Rules           128

160-25... Powers of appointed actuary......................................................... 128

160-30... Actuary’s obligations to report...................................................... 129

160-35... Qualified privilege of appointed actuary........................................ 131

Division 163—Prudential standards                                                                  132

163-1..... Private Health Insurance (Insurer Obligations) Rules to establish prudential standards         132

163-5..... Compliance with prudential standards........................................... 133

163-10... Notice of breaches of prudential standards etc............................... 133

163-15... Directions to comply with standards............................................. 133

163-20... Failure to comply with directions.................................................. 134

Division 166—Disqualified persons                                                                   135

166-1..... Private health insurers not to allow disqualified persons to act as directors           135

166-5..... Disqualified persons must not act for private health insurers........ 135

166-10... Effect of non-compliance................................................................ 135

166-15... Who is a disqualified person ?......................................................... 135

166-20... Council may disqualify persons..................................................... 136

166-25... Council may determine that persons are not disqualified............... 137

Division 169—Reporting and notification requirements                        139

169-1..... Copies of reports to policy holders............................................... 139

169-5..... Information to be given to the Council annually............................ 139

169-10... Private health insurers to notify any changes to rules.................... 140

169-15... Private health insurers to notify Department and Council about current chief executive officer            140

Division 172—Miscellaneous                                                                               142

172-1..... Private health insurers to comply with Council’s requirements.... 142

172-5..... Agreements with medical practitioners.......................................... 142

172-10... Private health insurers to give information to Secretary................. 142

172-15... Restrictions on payment of pecuniary penalties etc...................... 143

Chapter 5—Enforcement                                                                                    144

Part 5-1—Introduction                                                                                                       144

Division 180—Introduction                                                                                    144

180-1..... What this Chapter is about............................................................. 144

Part 5-2—General enforcement methods                                                               145

Division 185—What this Part is about                                                              145

185-1..... Introduction.................................................................................... 145

185-5..... Meaning of enforceable obligation ................................................. 145

185-10... Meaning of Council-supervised obligation ..................................... 146

Division 188—Performance indicators                                                             147

188-1..... Performance indicators................................................................... 147

Division 191—Explanation of private health insurer’s operations   148

191-1..... Minister or Council may seek an explanation from a private health insurer           148

191-5..... Writer must respond to insurer’s explanation................................ 149

Division 194—Investigation of private health insurer’s operations 150

194-1..... Minister or Council may investigate a private health insurer......... 150

194-5..... Notice to give information.............................................................. 150

194-10... Notice to produce documents......................................................... 151

194-15... Notice to give evidence................................................................... 152

194-20... Offences in relation to investigation notices................................... 152

194-25... Authorisation to examine books and records etc............................ 153

194-30... Minister may consult Council........................................................ 153

194-35... Minister or Council must notify outcome of investigation............ 154

Division 197—Enforceable undertakings                                                       155

197-1..... Minister or Council may accept written undertakings given by a private health insurer        155

197-5..... Enforcement of undertakings.......................................................... 155

Division 200—Ministerial and Council directions                                     157

200-1..... Minister or Council may give directions........................................ 157

200-5..... Direction requirements................................................................... 158

Division 203—Remedies in the Federal Court                                           159

203-1..... Minister or Council may apply to the Federal Court.................... 159

203-5..... Declarations of contravention......................................................... 159

203-10... Pecuniary penalty order................................................................. 160

203-15... Compensation order....................................................................... 160

203-20... Adverse publicity order.................................................................. 161

203-25... Other order..................................................................................... 161

203-30... Time limit for declarations and orders............................................ 161

203-35... Civil evidence and procedure rules for declarations and orders...... 161

203-40... Civil proceedings after criminal proceedings.................................. 162

203-45... Criminal proceedings during civil proceedings................................ 162

203-50... Criminal proceedings after civil proceedings.................................. 162

203-55... Evidence given in proceedings for penalty not admissible in criminal proceedings 163

203-60... Minister or Council may require person to assist.......................... 163

203-65... Relief from liability for contravening an enforceable obligation..... 165

203-70... Powers of Federal Court................................................................. 166

Division 206—Revoking entitlement to offer rebate as a premium reduction   167

206-1..... Revocation of status of participating insurer................................. 167

Part 5-3—Enforcement of health benefits fund requirements                    168

Division 211—Introduction                                                                                    168

211-1..... What this Part is about................................................................... 168

211-5..... Purpose of this Part........................................................................ 168

211-10... The Private Health Insurance (Health Benefits Fund Enforcement) Rules             169

211-15... Limitation on external management and termination of health benefits funds         169

Division 214—Investigations into affairs of private health insurers 170

214-1..... Investigation of private health insurers by inspectors................... 170

214-5..... Powers of inspectors...................................................................... 170

214-10... Person may be represented by lawyer........................................... 171

214-15... Compliance with requirements of inspectors................................. 171

214-20... Access to premises......................................................................... 172

214-25... Reports of inspectors..................................................................... 173

214-30... Dissemination of reports................................................................ 175

214-35... Liability for publishing reports etc................................................. 175

214-40... Delegation by inspectors................................................................ 176

214-45... Records not to be concealed etc...................................................... 176

Division 217—External management of health benefits funds            177

Subdivision 217-A—Preliminary                                                                          177

217-1..... Purpose of Division........................................................................ 177

217-5..... The basis of the law relating to external management..................... 177

Subdivision 217-B—Appointment of external managers                                  178

217-10... Council may appoint external managers......................................... 178

217-15... Grounds of appointment of external managers............................... 179

217-20... External managers to displace management of funds...................... 179

Subdivision 217-C—Duties and powers of external managers                        180

217-25... Duties of external managers............................................................ 180

217-30... Additional powers of external managers......................................... 180

217-35... Protection of property during external management...................... 181

217-40... Rights of chargee, owner or lessor of property of fund under external management               181

Subdivision 217-D—Procedure relating to voluntary deeds of arrangement 182

217-45... Matters that may be included in the Private Health Insurance (Health Benefits Fund Enforcement) Rules          182

Subdivision 217-E—External managers’ reports to Council                           183

217-50... External managers to give reports to Council................................. 183

217-55... Dealing with reports given to the Council...................................... 184

217-60... Court orders in respect of schemes of arrangement........................ 185

Subdivision 217-F—Miscellaneous                                                                      186

217-65... When an external management begins and ends.............................. 186

217-70... Effect of things done during external management of health benefits funds            187

217-75... Disclaimer of onerous property..................................................... 187

217-80... Application of provisions of Corporations Act............................. 187

Division 220—Ordering the termination of health benefits funds     190

220-1..... Applications by external managers to the Federal Court............... 190

220-5..... Orders made on applications for appointments of terminating managers               190

220-10... Binding nature of Court orders....................................................... 190

220-15... Notice of appointments.................................................................. 190

Chapter 6—Administration                                                                               192

Part 6-1—Introduction                                                                                                       192

Division 230—Introduction                                                                                    192

230-1..... What this Chapter is about............................................................. 192

Part 6-2—Private Health Insurance Ombudsman                                             194

Division 235—Introduction                                                                                    194

235-1..... Principal object of this Part............................................................ 194

235-5..... Private Health Insurance (Ombudsman) Rules............................... 194

Division 238—Establishment and functions                                                  195

238-1..... Establishment of office of Private Health Insurance Ombudsman. 195

238-5..... Functions of Private Health Insurance Ombudsman...................... 195

Division 241—Complaints                                                                                      197

Subdivision 241-A—Relevant complaints                                                            197

241-1..... Who may make a complaint........................................................... 197

241-5..... Persons against whom complaints may be made............................ 197

241-10... Grounds for complaint................................................................... 197

Subdivision 241-B—Dealing with complaints                                                    198

241-15... Initial receipt of complaint............................................................. 198

241-20... Ways of dealing with complaints................................................... 198

241-25... Referral to the Australian Competition and Consumer Commission 199

241-30... Referral to other bodies.................................................................. 200

241-35... Deciding not to deal with a complaint............................................ 200

Subdivision 241-C—Referral to subjects of complaints                                   202

241-40... Referral to the subject of the complaint......................................... 202

Subdivision 241-D—Investigation of complaints                                                203

241-45... Investigation of complaint.............................................................. 203

241-50... Minister may direct Private Health Insurance Ombudsman to investigate, or to continue to investigate, a complaint........................................................................................................ 203

Subdivision 241-E—Recommendations and reports                                          204

241-55... Recommendations as a result of referral or investigation............... 204

241-60... Report to Minister on outcome of investigation under Subdivision 241-D            205

Subdivision 241-F—Miscellaneous                                                                      206

241-65... Complainant to be kept informed................................................... 206

Division 244—Investigations                                                                                207

Subdivision 244-A—Investigations                                                                       207

244-1..... Initiating investigations................................................................... 207

244-5..... Investigations at Minister’s request............................................... 207

Subdivision 244-B—Recommendations and reports                                         208

244-10... Recommendations as a result of investigation................................ 208

244-15... Report to Minister on outcome of investigations under this Division 209

244-20... Consultation with Australian Competition and Consumer Commission                210

Division 247—Mediation                                                                                         211

247-1..... Conducting mediation..................................................................... 211

247-5..... Participation in mediation may be compulsory.............................. 211

247-10... Medical practitioners may appoint representatives....................... 212

247-15... Conduct of compulsory mediation................................................. 213

247-20... Admissibility of things said in mediation....................................... 213

247-25... Appointment of mediators............................................................. 214

Division 250—Information-gathering                                                               215

250-1..... Information-gathering..................................................................... 215

250-5..... Limits on information-gathering..................................................... 217

250-10... Disclosure of personal information................................................ 217

Division 253—Provisions relating to the Private Health Insurance Ombudsman            219

253-1..... Appointment of the Private Health Insurance Ombudsman.......... 219

253-5..... Validity of appointments............................................................... 219

253-10... Acting appointments...................................................................... 219

253-15... Remuneration and allowances......................................................... 220

253-20... Outside employment...................................................................... 220

253-25... Leave of absence............................................................................. 220

253-30... Resignation..................................................................................... 221

253-35... Termination of appointment.......................................................... 221

253-40... Disclosure of interest by Private Health Insurance Ombudsman... 222

253-45... Statutory agency etc. for purposes of Public Service Act.............. 222

253-50... Annual report................................................................................. 222

253-55... Delegation....................................................................................... 223

253-60... Private Health Insurance Ombudsman and staff not personally liable 223

Division 256—Miscellaneous                                                                               224

256-1..... Protection from civil actions........................................................... 224

256-5..... Victimisation................................................................................... 224

256-10... Giving information about the Private Health Insurance Ombudsman 224

Part 6-3—Private Health Insurance Administration Council                      226

Division 261—Introduction                                                                                    226

261-1..... What this Part is about................................................................... 226

261-5..... The Private Health Insurance (Council) Rules............................... 226

Division 264—Continuation, purposes, functions and powers            227

264-1..... Continuation of the Council........................................................... 227

264-5..... Objectives of the Council............................................................... 227

264-10... Functions of the Council................................................................ 228

264-15... Report on private health insurers................................................... 230

264-20... Powers............................................................................................ 231

264-25... Directions by Minister................................................................... 231

Division 267—Constitution and administration                                           232

267-1..... Constitution of the Council............................................................ 232

267-5..... Appointment of members.............................................................. 232

267-10... Meetings of the Council................................................................. 232

267-15... Delegation by the Council.............................................................. 233

267-20... Modification of the Commonwealth Authorities and Companies Act 1997              233

Division 270—Members                                                                                          234

270-1..... Terms and conditions etc................................................................ 234

270-5..... Validity of appointments............................................................... 234

270-10... Acting Commissioner..................................................................... 234

270-15... Deputy Commissioner to act as Commissioner in certain circumstances               235

270-20... Powers and duties of persons acting as Commissioner.................. 235

270-25... Remuneration and allowances of members..................................... 236

270-30... Leave of absence............................................................................. 236

270-35... Resignation..................................................................................... 237

270-40... Termination of appointment.......................................................... 237

270-45... Disclosure of interests.................................................................... 238

Division 273—Chief Executive Officer and staff                                        239

273-1..... Chief Executive Officer................................................................... 239

273-5..... Duties of Chief Executive Officer................................................... 239

273-10... Conflict of interests........................................................................ 239

273-15... Staff and consultants...................................................................... 240

273-20... Remuneration and allowances of Chief Executive Officer.............. 240

273-25... Leave of absence of Chief Executive Officer.................................. 241

Part 6-4—Administration of premiums reduction and incentive payments schemes             242

Division 276—Introduction                                                                                    242

276-1..... What this Part is about................................................................... 242

Division 279—Provisions applying only to premiums reduction scheme              243

Subdivision 279-A—Reimbursement of private health insurers for premiums reduced under scheme         243

279-1..... Participating insurers may claim reimbursement............................ 243

279-5..... Participating insurers...................................................................... 243

279-10... Requirements for claims................................................................. 244

279-15... Amounts payable to the private health insurer.............................. 244

279-20... Notifying private health insurers if amount is not payable............ 244

279-25... Additional payment if insurer claims less than entitlement........... 245

279-30... Additional payment if insurer makes a late claim........................... 245

279-35... Content and timing of application.................................................. 246

279-40... Decision on application.................................................................. 246

279-45... Reconsideration of decisions.......................................................... 247

Subdivision 279-B—Powers of Medicare Australia CEO in relation to participating insurers       248

279-50... Audits by Medicare Australia CEO............................................... 248

279-55... Medicare Australia CEO may require production of applications. 249

Division 282—Provisions applying to premiums reduction scheme and incentive payments scheme 251

Subdivision 282-A—When and how payments can be recovered                     251

282-1..... Recovery of payments................................................................... 251

282-5..... Interest on amounts recoverable..................................................... 252

282-10... Medicare Australia CEO may set off debts against amounts payable 253

282-15... Reconsideration of certain decisions under this Division............... 254

Subdivision 282-B—Miscellaneous                                                                      255

282-20... Notification requirements—private health insurers....................... 255

282-25... Use etc. of information relating to another person......................... 256

282-30... Information to be provided to the Commissioner of Taxation....... 256

282-35... Delegation....................................................................................... 257

282-40... Appropriation................................................................................ 257

Part 6-5—External managers and terminating managers                             258

Division 287—Introduction                                                                                    258

287-1..... What this Part is about................................................................... 258

287-5..... The Private Health Insurance (Management) Rules....................... 258

Division 290—Powers of managers                                                                   259

290-1..... Powers of managers........................................................................ 259

290-5..... Officers etc. not to perform functions etc. while fund is under management          259

290-10... Managers act as agents of private health insurers.......................... 260

Division 293—Information concerning, and records and property of, health benefits funds      261

293-1..... Directors etc. to help managers...................................................... 261

293-5..... Managers’ rights to certain records................................................ 262

293-10... Only manager can deal with property of fund under management. 263

293-15... Order for compensation where officer involved in void transaction 264

Division 296—Provisions incidental to appointment of managers    266

296-1..... Remuneration of managers.............................................................. 266

296-5..... Council may give directions to managers........................................ 266

296-10... Termination of appointments of managers..................................... 266

296-15... Acts of managers valid etc.............................................................. 267

296-20... Indemnity....................................................................................... 268

296-25... Qualified privilege........................................................................... 268

Division 299—Miscellaneous                                                                               269

299-1..... Time for doing act does not run while act prevented by this Division 269

299-5..... Continued application of other provisions of Act......................... 269

299-10... Modifications of this Act in relation to health benefits funds under management  270

299-15... Order of Court to be binding on all persons................................... 270

299-20... Jurisdiction of Federal Court.......................................................... 270

299-25... Private Health Insurance (Management) Rules dealing with various matters          270

Part 6-6—Private health insurance levies                                                              272

Division 304—Introduction                                                                                    272

304-1..... What this Part is about................................................................... 272

304-5..... Private Health Insurance (Levy Administration) Rules................. 272

304-10... Meaning of private health insurance levy ....................................... 272

Division 307—Collection and recovery of private health insurance levies          273

307-1..... When private health insurance levy must be paid.......................... 273

307-5..... Late payment penalty.................................................................... 274

307-10... Payment of levy and late payment penalty................................... 274

307-15... Recovery of levy and late payment penalty.................................. 275

307-20... Waiver of late payment penalty for levies other than collapsed insurer levy         275

307-25... Waiver of collapsed insurer levy and late payment penalty for that levy               276

307-30... Other matters.................................................................................. 277

Division 310—Returns, requesting information and keeping records    278

310-1..... Returns must be lodged with Council and Department.................. 278

310-5..... Insurer must keep records.............................................................. 278

310-10... Council may request information from insurer............................... 279

Division 313—Power to enter premises and search for documents 281

313-1..... Authorised officer may enter premises with consent..................... 281

313-5..... Authorised officer may enter premises under warrant................... 281

313-10... Announcement before entry........................................................... 282

313-15... Executing a warrant to enter premises............................................ 282

313-20... Identity cards.................................................................................. 283

Part 6-7—Private Health Insurance Risk Equalisation Trust Fund        285

Division 318—Private Health Insurance Risk Equalisation Trust Fund               285

318-1..... Private Health Insurance Risk Equalisation Trust Fund................ 285

318-5..... Amounts to be paid into the Risk Equalisation Trust Fund.......... 285

318-10... Operation of the Risk Equalisation Trust Fund............................. 286

318-15... Administration of the Risk Equalisation Trust Fund..................... 286

Part 6-8—Disclosure of information                                                                          287

Division 323—Disclosure of information                                                        287

323-1..... Prohibition on disclosure of information........................................ 287

323-5..... Authorised disclosure: official duties............................................. 287

323-10... Authorised disclosure: sharing information about insurers among agencies            288

323-15... Authorised disclosure: sharing information about insurers other than among agencies           289

323-20... Authorised disclosure: public interest............................................ 289

323-25... Authorised disclosure: by the Secretary or Council if authorised by affected person            290

323-30... Authorised disclosure: court proceedings....................................... 290

323-35... Authorised disclosure: Council’s public information and agency cooperation functions        291

323-40... Offence: disclosure of information obtained by certain authorised disclosures       291

323-45... Offence: soliciting disclosure of information.................................. 291

323-50... Offence: use etc. of unauthorised information................................ 291

323-55... Offence: offering to supply protected information........................ 292

Part 6-9—Review of decisions                                                                                      293

Division 328—Review of decisions                                                                    293

328-1..... What this Part is about................................................................... 293

328-5..... AAT review of decisions................................................................ 293

Part 6-10—Miscellaneous                                                                                               298

Division 333—Miscellaneous                                                                               298

333-1..... Delegation by Minister................................................................... 298

333-5..... Delegation by Secretary.................................................................. 298

333-10... Approved forms............................................................................. 298

333-15... Signing approved forms.................................................................. 300

333-20... Private Health Insurance Rules made by the Minister................... 300

333-25... Private Health Insurance Rules made by the Council..................... 301

333-30... Regulations..................................................................................... 302

Schedule 1—Dictionary                                                                                        303

1............ Dictionary....................................................................................... 303



 

 

Private Health Insurance Act 2007

No. 31, 2007

 

 

 

An Act to regulate private health insurance, and for related purposes

[ Assented to 30 March 2007 ]

The Parliament of Australia enacts:

Chapter 1 Introduction



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.

application provision is defined in subsection 217-80(2).

applied Corporations Act provision is defined in subsection 217-80(3).

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) to (4A).

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 is defined in section 69-10.

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.

net asset position , of a * health benefits fund, means the difference between:

                     (a)  the * assets of the fund; and

                     (b)  the * policy liabilities and other liabilities of the fund that the private health insurer conducting the fund has incurred for the purposes of the fund.

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 or provides a benefit for anything else).

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

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

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

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.

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.



 

 

[ Minister’s second reading speech made in—

House of Representatives on 7 December 2006

Senate on 26 February 2007 ]

(209/06)