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Private Health Insurance Legislation Amendment Bill 2018

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(Circulated by authority of the Minister for Health, the Hon Greg Hunt MP)











This addendum responds to concerns about the Private Health Insurance Legislation Amendment Bill 2018 raised by the Senate Standing Committee for the Scrutiny of Bills in Scrutiny Digest No. 5 of 2018, dated 9 May 2018.




  1. Under the heading ‘SCHEDULE 3 - Private Health Insurance Ombudsman’s powers’ (page 43), before the first paragraph - insert:



These powers are designed to strengthen the PHIO’s powers and functions to assist people who have made a complaint to the PHIO.


As part of resolving a complaint, the PHIO typically attempts to access records relevant to the complaint from the respondent. In almost all cases, respondents voluntarily provide full records to the PHIO in order to investigate complaints. However, there are some instances where upon further investigation, additional records such as phone calls, letters and emails have been overlooked by respondents when providing responses to the PHIO.


The PHIO has an existing power under section 20ZE to issue a notice compelling a respondent to give the PHIO information relevant to investigating a complaint.  Notwithstanding this power, the Government considers that the ability of PHIO to resolve consumer complaints would be strengthened by the power to enter places occupied by private health insurers and private health insurance brokers and inspect documents or other records


By having the power to access the respondent’s records directly within their premises, the PHIO’s investigating officers are able verify evidence that the respondent has provided to the PHIO. The Government consider that this power could be used by the PHIO to provide assurance to complainants that they have verified the accuracy of information provided by the respondent.  The PHIO can also use this power when conducting an investigation on his or her own initiative.


Respondents have consistently provided access to the PHIO investigating officers to verify the accuracy of information and this is expected to continue. It is expected that the PHIO would provide respondents with at least 48 hours’ notice of exercising the power of entry.

This new power is not expected to be used, but addresses the theoretical possibility that a respondent may not voluntarily consent to the PHIO entering their premises. 


Given that the PHIO is not a regulator and the Government considers that it is not appropriate to apply the Regulatory Powers (Standard Provisions) Act 2014 the powers will only be used by the PHIO in an instance when consent is not forthcoming, noting that this has not occurred.



The purpose of entry in these circumstances is not to obtain evidence to support a criminal or civil prosecution; the intention is to confirm information provided by a consumer and to enable the PHIO to make non-binding recommendations, having received comprehensive information from both parties.


  1. At item 5 (page 45), after the second paragraph - insert:


The Guide to Framing Commonwealth Offences acknowledges that it is appropriate to reverse the onus of proof and place a burden on the defendant in certain circumstances. This includes where a matter is peculiarly within the knowledge of the defendant and where it would be significantly more difficult and costly for the prosecution to disprove the matter than for the defendant to establish the matter.


The offence provision provided by subsection 20ZIA(4) is a common provision in relation to identity cards.   Subsection 20ZIA(4) provides that a person commits an offence of strict liability if, the person ceases to be a member of staff mentioned in section 31 or ceases to be a person to whom the PHIO has delegated its powers under section 34 in relation to section 20SA or 20TA, and the person does not return their identity card to the PHIO within 14 days of so ceasing.  Subsection (4) does not apply if the identity card was lost or destroyed (refer to subsection (5)).


It is up to the defendant in a prosecution under proposed section 20ZIA to provide evidence that the identify card was lost or destroyed (and that the exception under subsection (5) applies), as she or he will be the only person with knowledge of those circumstances.  It is unreasonable for the prosecution to prove that the card was not lost or destroyed


The prosecution will still be required to prove each element of the offence beyond a reasonable doubt before a defence can be raised by the defendant. Further, if the defendant discharges an evidential burden, the prosecution will also be required to disprove these matters beyond reasonable doubt, consistent with section 13.1 of the Criminal Code.


  1.  At item 6 (page 45) after the first paragraph - insert:


Currently, under sub-section 34(2C), the Commonwealth Ombudsman can delegate all powers or functions under the Ombudsman Act 1976 , except those contained in section 20R and 20V, to any member of staff.


With respect to specific circumstances in which it is envisaged it may be necessary to delegate powers or functions to persons outside the Australian Public Service. In practice, it is expected that the Ombudsman would only authorise people with appropriate attributes, qualifications, qualities and relevant experience. Some complaints that are brought to the PHIO can be complex in nature and may require a subject matter expert to assist with investigations.


As the inspection and audit function is new, it is not entirely clear what the necessary staffing level will be. The proposed amendment will enable the PHIO to ensure the function is staffed at the appropriate level and provides flexibility to reduce staffing levels if there is limited need to use the inspections power. This is prudent business practice and supports the effective and efficient use of agency resources to meet operational requirements.


Prior to the commencement of the new functions, the PHIO will have in place procedures that will ensure that only those people with appropriate qualifications and experience, and relevant training, are delegated key functions associated with the PHIO.