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Health Legislation Amendment Act (No. 2) 1999

  • - C2004A00415
  • No longer in force
Act No. 21 of 1999 as made
An Act to amend legislation relating to health, and for related purposes
Originating Bill: Health Legislation Amendment Bill (No. 4) 1998
Date of Assent 19 Apr 1999
Date of repeal 10 Mar 2016
Repealed by Amending Acts 1990 to 1999 Repeal Act 2016
Table of contents.

 

 

 

 

Health Legislation Amendment Act (No. 2) 1999

 

No. 21, 1999


 

 

 

 

Health Legislation Amendment Act (No. 2) 1999

 

No. 21, 1999

 

 

 

 

An Act to amend legislation relating to health, and for related purposes

  

  


Contents

1............ Short title............................................................................................ 1

2............ Commencement.................................................................................. 1

3............ Schedule(s).......................................................................................... 2

Schedule 1—Amendment of the National Health Act 1953 to allow registered organizations greater product flexibility                                                                                                                                       3

Part 1—Amendments relating to discounted rates of contributions               3

Part 2—Amendments relating to loyalty bonus schemes                                   7

Part 3—Amendments relating to waiting periods                                                  9

Part 4—Amendments relating to coverage of pharmaceutical benefits costs 12

Schedule 2—Amendment of the National Health Act 1953 related to the amendments made by Parts 1 and 2 of Schedule 1                                                                                                                        13

 


Health Legislation Amendment Act (No. 2) 1999

No. 21, 1999

 

 

 

An Act to amend legislation relating to health, and for related purposes

[Assented to 19 April 1999]

The Parliament of Australia enacts:

1  Short title

                   This Act may be cited as the Health Legislation Amendment Act (No. 2) 1999.

2  Commencement

             (1)  Subject to subsections (2) and (3), this Act commences on the day on which it receives the Royal Assent.

             (2)  Subject to subsection (3), the items of Schedules 1 and 2 commence on a day or days to be fixed by Proclamation.

             (3)  If an item referred to in subsection (2) does not commence within 6 months after the day on which this Act receives the Royal Assent, it commences on the first day after the end of that period.

3  Schedule(s)

                   Subject to section 2, each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.


 

Schedule 1Amendment of the National Health Act 1953 to allow registered organizations greater product flexibility

Part 1Amendments relating to discounted rates of contributions

1  At the end of section 73BA

Add:

             (4)  The Minister may, after having regard to the management expenses incurred by all organizations, make a determination in writing of the maximum percentage of discount that organizations, under their rules and in accordance with paragraph (s) of Schedule 1, may offer to contributors in respect of their rates of contribution.

             (5)  Determinations under subsection (4) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

2  Paragraph (q) of Schedule 1

Repeal the paragraph, substitute:

                     (q)  The organization will, for each applicable benefits arrangement, and for each table of ancillary health benefits, offered by the organization:

                              (i)  if the arrangement or table covers memberships consisting of a contributor and also 2 or more other persons of whom at least one is not a dependent child of the contributor—charge the same contribution in respect of each such membership; and

                             (ii)  if the arrangement or table covers memberships consisting of a contributor and one or more dependent children of the contributor—charge the same contribution in respect of each such membership; and

                            (iii)  if the arrangement or table covers memberships consisting solely of a contributor—charge the same contribution in respect of each such membership; and

                            (iv)  if the arrangement or table covers memberships consisting of a contributor and one other person who is not a dependent child of the contributor—charge the same contribution in respect of each such membership;

                            unless, under the rules of the organization, a discounted rate of contribution is payable by or in respect of such a contributor.

                      (r)  For the purposes of paragraph (q), dependent child, in relation to a contributor, means a person:

                              (i)  who is covered as a dependant of the contributor; and

                             (ii)  whom the organization accepts under its rules as a dependent child of the contributor;

                            but does not include;

                            (iii)  a person who is the spouse or partner of another person; or

                            (iv)  a person (other than a full‑time student) who is 18 or older; or

                             (v)  a full‑time student who is 25 or older.

                      (s)  The rules of the organization may provide that a discounted rate of contribution is payable by or in respect of a contributor for an applicable benefits arrangement, or for a table of ancillary health benefits, offered by the organization, only if at least one of the following payment circumstances applies to the payment of contribution by or in respect of that contributor:

                              (i)  it is paid at least 6 months in advance;

                             (ii)  it is paid through a payroll deduction;

                            (iii)  it is paid through a direct debit from an account at a bank or other financial institution;

                            (iv)  it is paid on behalf of the contributor concerned because the contributor is to be treated, under the rules of the organization, as belonging to a contribution group.

                      (t)  The rules of the organization may provide that a discounted rate of contribution is payable by or in respect of a contributor in respect of a payment circumstance set out in paragraph (s) only if:

                              (i)  the percentage by which the rate of contribution is discounted does not exceed the percentage determined by the Minister from time to time under subsection 73BA(4); and

                             (ii)  the discount applies in respect of the rates of contribution applicable to each membership group referred to in paragraph (q) that is covered by an applicable benefits arrangement or table of ancillary health benefits offered by the organization; and

                            (iii)  the discount, although it may be renewed, is not granted for more than 12 months; and

                            (iv)  the organization is satisfied, on reasonable grounds, that the revenue forgone by providing the discount is likely to be less than, or equal to, the reduction in management expenses attributable to that payment circumstance.

                     (u)  The rules of the organization, if they provide for one or more discounted rates of contribution:

                              (i)  will provide a full statement of all undiscounted rates of contribution separately from those discounted rates; and

                             (ii)  will identify each payment circumstance set out in paragraph (s) in respect of which a discounted rate is available and indicate the amount of discount expressed as a percentage of the undiscounted rate of contribution; and

                            (iii)  will preclude an entitlement to a greater discount because more than one payment circumstance applies in respect of a contributor.

                     (v)  The organization, if required in writing by the Minister to do so, will provide documentary evidence to the Minister indicating how the organization satisfied itself of the matter referred to in subparagraph (t)(iv).

                    (w)  The organization will comply with any direction of the Minister under this Act served on it.

3  Saving provision

If, under an applicable benefits arrangement of an organization in force immediately before the commencement of items 1 and 2 of this Schedule, the organization purported to allow a contributor to the health benefits fund conducted by that organization an entitlement to a discount in the rate of contribution payable by that contributor, that entitlement continues to be available after that commencement on the terms originally agreed between the organization and the contributor despite the fact that it is not consistent with the conditions to which registrations are subject applying after that commencement.


 

Part 2Amendments relating to loyalty bonus schemes

4  After subsection 73BA(2)

Insert:

          (2A)  The Minister may determine, in writing, guidelines relating to the establishment by an organization, under its rules and in accordance with the conditions set out in paragraph (ma) of Schedule 1, of loyalty bonus schemes.

          (2B)  Such guidelines:

                     (a)  may cover all or any of the following:

                              (i)  the circumstances in which organizations can offer financial benefits, goods or services under a loyalty bonus scheme;

                             (ii)  the types of actual and contingent financial benefits that can be offered to a contributor, a dependant of a contributor or a third party under such a scheme;

                            (iii)  the types of goods or services that can be offered by the organization or, at the instigation of the organization, by a third party, to a contributor or dependant; and

                     (b)  are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

5  After paragraph (m) of Schedule 1

Insert:

                   (ma)  The rules of the organization may permit the organization to implement a scheme (to be known as a loyalty bonus scheme) under which:

                              (i)  the organization offers actual or contingent financial benefits to a contributor to the health benefits fund conducted by the organization, or to a dependant of such a contributor, or to a third party on behalf of such a contributor or dependant; or

                             (ii)  the organization offers, or arranges for a third party to offer, goods or services to such a contributor or dependant;

                            in recognition of the period of time over which contributions have been paid by or on behalf of such a contributor under an applicable benefits arrangement or for a table of ancillary health benefits, only if the provision of such financial benefits, goods or services is consistent with any guidelines that are determined by the Minister under subsection 73BA(2A).

                   (mb)  The organization will not, in determining whether a contributor or a dependant of a contributor may participate in a loyalty bonus scheme, have regard to any of the following matters:

                              (i)  the suffering by the contributor, or a dependant of the contributor, from a chronic disease, illness or other medical condition or from a disease, illness or medical condition of a particular kind;

                             (ii)  the age of the contributor or of a dependant of a contributor;

                            (iii)  the frequency of the rendering of professional services to the contributor or to a dependant of a contributor;

                            (iv)  the amount, or extent, of the benefits to which the contributor becomes, or has become, entitled during a period;

                             (v)  any matter prescribed for the purpose of this provision.


 

Part 3Amendments relating to waiting periods

6  After section 73BA

Insert:

73BAA  Waiver of waiting periods

             (1)  Nothing in this Act prevents a registered health benefits organization from waiving, in whole or in part, in relation to a contributor to the health benefits fund conducted by the organization or to any dependant of the contributor, the requirement of a waiting period applicable to that contributor or dependant, provided that any action under this subsection that results in the extension of a waiting period applicable to a contributor or his or her dependant for an ailment, illness or condition (including a pre-existing ailment) is prescribed in accordance with subsection (3).

             (2)  For the avoidance of doubt, subsection (1) applies to waiting periods established before, as well as to waiting periods established on or after, the day on which this section commences.

             (3)  Regulations for the purposes of subsection (1) in respect of an ailment, illness or condition (including a pre-existing ailment) must not be made unless the Minister has taken into account the following matters:

                     (a)  evidence that the ailment, illness or condition is associated with opportunistic membership of health benefits funds; and

                     (b)  the potential for an extended waiting period to discriminate against people with the ailment, illness or condition; and

                     (c)  the impact of an extended waiting period on:

                              (i)  the principle of community rating; and

                             (ii)  the public health system; and

                     (d)  such other matters as the Minister considers relevant.

7  Paragraph (bb) of Schedule 1

Omit “paragraph (bc)”, substitute “paragraph (j)”.

8  Paragraph (bc) of Schedule 1

Repeal the paragraph.

9  Paragraph (j) of Schedule 1

Repeal the paragraph, substitute:

                      (j)  Except in a case to which subparagraph (ka)(i) or paragraph (ja) applies, if the rules of the organization permit the fixing of waiting periods in relation to the provision of benefits to:

                              (i)  a contributor to the health benefits fund conducted by that organization: or

                             (ii)  a dependant of that contributor;

                            under an applicable benefits arrangement of the organization (whether or not that arrangement is an arrangement modified by an election of the kind referred to in paragraph (ba)), a waiting period so fixed:

                            (iii)  will commence, in respect of each such contributor or dependant, on a day that is worked out in a manner specified in the regulations; and

                            (iv)  will not exceed, in respect of an ailment, illness or condition (including a pre‑existing ailment) that is identified in the regulations, a period that is specified in relation to that ailment, illness or condition.

10 After paragraph (j) of Schedule 1

            Insert:

                     (ja)  subject to paragraph (kc), where the rules of the organization provide for a waiting period with respect to contributors for benefits in accordance with an applicable benefits arrangement of the organization and the benefits are in relation to psychiatric care, palliative care or rehabilitation, that waiting period will not exceed 2 months;

11  Paragraph (k) of Schedule 1

Repeal the paragraph.

12  Paragraph (ka) of Schedule 1

Omit “or (k)” (wherever occurring).

13  Paragraph (kc) of Schedule 1

Omit “paragraph (k)”, substitute “paragraphs (j) and (ja)”.

14  Paragraph (kd) of Schedule 1

Omit “subparagraph (bc)(i) or”.

15  Saving provision

If, immediately before the commencement of items 6 to 14 of this Schedule, a waiting period was applicable to a person under an applicable benefits arrangement of a particular registered organization, the amendments made by those items do not affect the circumstances in which that waiting period applies to that person or the duration of that waiting period.


 

Part 4Amendments relating to coverage of pharmaceutical benefits costs

15  Paragraph 73A(1)(a)

After “a condition that”, insert “, except in the circumstances set out in subsection 92B(2),”.

16  Section 92B

Repeal the section, substitute:

92B  Persons not to enter into certain refund agreements

             (1)  Except as provided in subsection (2), a person who is an insurer must not enter into a contract of insurance that comprises or contains a refund agreement.

Penalty:  20 penalty units

             (2)  If:

                     (a)  a registered organization enters into an applicable benefits arrangement with a contributor to the health benefits fund conducted by the organization; and

                     (b)  the organization purports, under that arrangement, to cover 100% of the cost to the contributor of hospital treatment provided to the contributor or a dependant as an admitted patient at a hospital or a day hospital facility with which the organization has a hospital purchaser‑provider agreement;

the organization must provide, in its rules, that the cost so covered includes the whole of the amount that, but for the arrangement, would be the cost to the contributor or dependant of pharmaceutical benefits dispensed to the contributor or dependant while the contributor or dependant is a patient at the hospital or day hospital facility.


 

 

 

Schedule 2Amendment of the National Health Act 1953 related to the amendments made by Parts 1 and 2 of Schedule 1

  

1  After section 5A

Insert:

5AB  Changes in the instruments of a registered organization relating to rates of contribution

                   If a registered organization changes its constitution, its articles of association or its rules so that the constitution, articles or rules as changed:

                     (a)  provide, or purport to provide, for discounted rates of contribution to the health benefit fund conducted by that organization; or

                     (b)  implement, or purport to implement, loyalty bonus schemes of the kind referred to in paragraph (ma) of Schedule 1 for certain contributors to the health benefits fund contributed by that organization;

those changes in the constitution, articles or rules are not to be taken, for any purpose of this Act, to be changes that relate to the rate of contribution of contributors to that fund.

 

 

[Minister’s second reading speech made in—

House of Representatives on 3 December 1998

Senate on 22 March 1999]

 

 

 

 

 

(231/98)