Private Health Insurance (Incentives) Rules 2012 (No. 2)

made under item 1 of the table in section 333-20 of the

Private Health Insurance Act 2007

Compilation No. 5

Compilation date:   31 March 2020

Includes amendments up to:  F2020L00354

About this compilation

This compilation

This is a compilation of the Private Health Insurance (Incentives) Rules 2012 (No. 2) that shows the text of the law as amended and in force on 31 March 2020 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Legislation Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the series page on the Legislation Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Editorial changes

For more information about any editorial changes made in this compilation, see the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the series page on the Legislation Register for the compiled law.

Self‑repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

Contents

Part 1  Preliminary       1

1. Name of Rules       1

4. Definitions       1

Part 2  Premiums reduction scheme     2

5. Application       2

5A. Rebate Adjustment Factor      2

6. Registration as a participant     2

8. Conditions of participation       3

9. Requirements for statements to participants     3

10. Rebate logo       4

Endnotes         5

Part 1 Preliminary

1. Name of Rules

These Rules are the Private Health Insurance (Incentives) Rules 2012 (No. 2).

4. Definitions

Note: Terms used in these Rules have the same meaning as in the Act―see section 13 of the Legislative Instruments Act 2003.  These terms include:

adjustment factor

adjustment year

complying health insurance policy

incentive payments scheme

participant

participating insurer

premiums reduction scheme

private health insurer

private health information statement

In these rules:

30% Rebate logo means the logo that insurers were required to use under the Private Health Insurance (Incentives) Rules 2007.

Act means the Private Health Insurance Act 2007.

Australian Government Rebate on private health insurance means:

(a) the premiums reduction scheme; or

(b) the private health insurance tax offset.

eligible person has the same meaning as in subsection 3 (1) of the Health Insurance Act 1973 and includes a person who is treated as an eligible person under sections 6, 6A or 7 of that Act.

private health insurance tax offset means a tax offset, under the Income Tax Assessment Act 1997, for a premium, or in respect of a premium, paid under a complying health insurance policy.

rebate adjustment factor means adjustment factor.

 Rebate logo means the logo described in rule 10.

Part 2 Premiums reduction scheme

5. Application

This Part applies in relation to financial years beginning on or after 1 July 2007.

5A. Rebate Adjustment Factor

For the purposes of paragraph 22-15(5E) of the Act the rebate adjustment factor is determined according to the following formula:

RAF  =  1

RAF = CPI factor for the relevant adjustment year

            1 + Average premium increase for the relevant adjustment year

Where:

RAF = rebate adjustment factor expressed as a factor to 3 decimal places (rounding up where the fourth decimal place is 5 or more).

CPI factor for the relevant adjustment year is the number worked out by dividing the CPI index number for the December quarter immediately preceding that year by the CPI index number for the December quarter preceding the first mentioned December quarter expressed as a factor to 4 decimal places (rounding up where the fifth decimal place is 5 or more).

CPI index number for a quarter is the All Groups Consumer Price Index number, being the weighted average of the 8 capital cities, published by the Australian Statistician in respect of that quarter.

Average premium increase for the relevant adjustment year means the figure published by the Department of Health during the course of an adjustment year that represents the industry average premium increase (including rate protection and the age-based discount factor) being the average change in premiums for each product subgroup offered by every private health insurer, weighted according to the number of people covered under complying health insurance policies in each product subgroup, expressed as a factor to 4 decimal places (rounding up where the fifth decimal place is 5 or more).

6. Registration as a participant

For the purposes of paragraph 23-15 (1) (c) of the Act, the requirements for a person applying to a private health insurer to become a participant in the premiums reduction scheme are:

(a) the person is an individual; and

(b) the person is applying in respect of a complying health insurance policy under which each person covered by the policy is an eligible person.

Note: Division 23 provides for reductions in premiums paid by a person to an insurer.  The insurer may claim reimbursement of such reductions under Division 279.

8. Conditions of participation

(1) For the purposes of paragraph 206-1 (1) (b) of the Act, the following conditions are specified as conditions of participation in the premiums reduction scheme:

(a) if a participant in respect of a complying health insurance policy on issue from the insurer during any time in the previous financial year requests the following information from a participating insurer:

(i) the amount of the premium paid for the policy during the previous financial year;

(ii) the reduction, under the premiums reduction scheme, for the premium;

the participating insurer must issue to the participant a statement in accordance with rule 9;

(b) before the participating insurer increases the amount of the premium, the insurer must issue to each participant affected by the increase written notice of:

(i) the amount of the premium; and

(ii) the increase in the amount of the premium; and

(iii) the date when the increase takes effect; and

(iv) the fact that the dollar value of the reduction under the Australian Government Rebate on private health insurance has increased; and

(v) the new amount of the reduction; and

(vi) the new amount of the premium; and

(c) the insurer must use the phrase “Australian Government Rebate on private health insurance” or the Rebate logo in:

(i) advertisements for the Australian Government Rebate on private health insurance; and

(ii) statements under paragraph (a); and

(iii) written notices under paragraph (b); and

(iv) forms that are given in relation to the premiums reduction scheme; and

(v) correspondence relating to the premiums reduction scheme. 

(d) notwithstanding paragraph (c), for any items listed under subparagraphs (i) to (v), an insurer may use any material containing the phrase ‘Federal Government 30% Rebate’ or the 30% Rebate logo until one year after the date of commencement of these Rules.

Note: Rule 10 sets out the details of the Rebate logo.

9. Requirements for statements to participants

(1) A statement under paragraph 8 (1) (a) must:

(a) be in writing; and

(b) set out, clearly and distinctly:

(i) if requested by the participant—the amount of the premium paid for the policy during a particular financial year; and

(ii) if requested by the participant—the amount of the reduction under the premiums reduction scheme for the premium; and

(c) be provided within 14 days of receipt of the request; and

(d) be provided:

(i) by post; or

(ii) if the participant has requested that the information be provided in another manner—if reasonably practicable, in the manner requested by the participant.

Example: If requested by the participant, the information may be provided in an electronic format, including via a web page.

(2) A statement under paragraph 8 (1) (a) may be accompanied by other information.

10. Rebate logo

(1) The logo for the Australian Government Rebate on private health insurance is:

(2) In any reproduction of the logo:

(a) the portions other than the shaded areas of the umbrella must be black and white, as shown in subrule (1); and

(b) the shaded areas of the umbrella must be:

(i) in the case of monochrome reproduction — 60% black; and

(ii) in any other case — red (PMS 032).

Endnotes

Endnote 1—About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

Abbreviation key—Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history—Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Editorial changes

The Legislation Act 2003 authorises First Parliamentary Counsel to make editorial and presentational changes to a compiled law in preparing a compilation of the law for registration. The changes must not change the effect of the law. Editorial changes take effect from the compilation registration date.

If the compilation includes editorial changes, the endnotes include a brief outline of the changes in general terms. Full details of any changes can be obtained from the Office of Parliamentary Counsel.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe the amendment to be made. If, despite the misdescription, the amendment can be given effect as intended, the amendment is incorporated into the compiled law and the abbreviation “(md)” added to the details of the amendment included in the amendment history.

If a misdescribed amendment cannot be given effect as intended, the abbreviation “(md not incorp)” is added to the details of the amendment included in the amendment history.

Endnote 2—Abbreviation key

Endnote 3—Legislation history

This endnote sets out details of the legislation history of the Private Health Insurance (Incentives) Rules 2012 (No. 2).

Table of Instruments

Endnote 4—Amendment history

This endnote sets out the amendment history of the Private Health Insurance (Incentives) Rules 2012 (No. 2).