2002‑2003

The Parliament of the
Commonwealth of Australia

HOUSE OF REPRESENTATIVES

Presented and read a first time

Health Legislation Amendment (Medicare and Private Health Insurance) Bill 2003

No.      , 2003

(Health and Ageing)

A Bill for an Act to amend the law relating to medicare and private health insurance, and for related purposes

Contents
1	Short title	1
2	Commencement	1
3	Schedule(s)	3
Schedule 1—Amendments relating to out‑of‑hospital insurance plans	4
Health Insurance Act 1973	4
National Health Act 1953	4
Private Health Insurance Incentives Act 1998	15
Schedule 2—Concessional safety‑net	17
Health Insurance Act 1973	17
Schedule 3—General Practice Access Scheme	25
Health Insurance Act 1973	25

A Bill for an Act to amend the law relating to medicare and private health insurance, and for related purposes
The Parliament of Australia enacts:
1  Short title
		This Act may be cited as the Health Legislation Amendment (Medicare and Private Health Insurance) Act 2003.
2  Commencement
	(1)	Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, on the day or at the time specified in column 2 of the table.

Commencement information	
Column 1	Column 2	Column 3	
Provision(s)	Commencement	Date/Details	
1.  Sections 1 to 3 and anything in this Act not elsewhere covered by this table	The day on which this Act receives the Royal Assent		
2.  Schedule 1, items 1 to 8	The day on which this Act receives the Royal Assent		
3.  Schedule 1, items 9 to 12	The later of:
(a) the start of the day on which this Act receives the Royal Assent; and
(b) immediately after the commencement of item 10 of Schedule 1 to the Health Legislation Amendment (Private Health Insurance Reform) Act 2003		
4.  Schedule 1, item 13	The day on which this Act receives the Royal Assent		
5.  Schedule 1, items 14 to 22	The day on which this Act receives the Royal Assent, subject to subsection (3)		
6.  Schedule 1, item 23	The day on which this Act receives the Royal Assent		
7.  Schedule 1, items 24 and  25	The day on which this Act receives the Royal Assent, subject to subsection (3)		
8.  Schedule 1, items 26 to 28	The day on which this Act receives the Royal Assent		
9.  Schedule 1, items 29 and 30	The day on which this Act receives the Royal Assent, subject to subsection (3)		
10.  Schedule 1, items 31 to 39	The day on which this Act receives the Royal Assent		
11.  Schedules 2 and 3	The day on which this Act receives the Royal Assent		
Note:	This table relates only to the provisions of this Act as originally passed by the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.
	(2)	Column 3 of the table is for additional information that is not part of this Act. This information may be included in any published version of this Act.
	(3)	If the Health Legislation Amendment (Private Health Insurance Reform) Act 2003 receives the Royal Assent before this Act, the amendment made by items 14 to 22, items 24 and 25, and items 29 and 30 of Schedule 1 to this Act are taken not to have been made.
3  Schedule(s)
		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 1—Amendments relating to out‑of‑hospital insurance plans
  
Health Insurance Act 1973
1  After subsection 126(5A)
Insert:
	(5B)	This section does not apply in relation to a contract of insurance that is an out‑of‑hospital insurance plan entered into by a registered organization under Division 4B of Part VI of the National Health Act 1953.
National Health Act 1953
2  Subsection 4(1)
Insert:
gap charge, in relation to an out‑of‑hospital service, means the difference between the total charge for the provision of that service and the medicare benefit payable in respect of that service.
3  Subsection 4(1)
Insert:
gap charge threshold, in relation to an out‑of‑hospital insurance plan and to a particular calendar year during all or a part of which that plan is in force, means a total of $1000:
	(a)	if the plan covers only one person—that is incurred by the person by way of gap charges; or
	(b)	if the plan covers more than one person—that is incurred collectively by the persons covered by the plan by way of gap charges;
in respect of out‑of‑hospital services that are provided during that calendar year or the part of that calendar year that the insurance plan is in force (whether or not those services are provided during a waiting period in respect of the plan).
4  Subsection 4(1)
Insert:
out‑of‑hospital insurance plan means a policy of health insurance offered by a registered organization to meet all reimbursable gap charges in respect of out‑of‑hospital services that are provided to a person covered by the policy.
5  Subsection 4(1)
Insert:
out‑of‑hospital service means a professional service in respect of which a medicare benefit is payable other than a professional service:
	(a)	of a kind referred to in paragraph 10(2)(a) of the Health Insurance Act 1973; or
	(b)	that is declared by the regulations not to be an out‑of‑hospital service for the purposes of this Act.
6  Subsection 4(1) (definition of waiting period)
Repeal the definition, substitute:
waiting period means:
	(a)	in relation to a person who is a contributor to the health benefits fund conducted by the registered organization because the person contributes for benefits under an applicable benefits arrangement or a table of ancillary health benefits—a period:
	(i)	that starts on the day on which the contributor became a contributor for those benefits; and
	(ii)	during which, under the rules of the organization, the contributor is not entitled to benefits under that arrangement or table; and
	(b)	in relation to a person who is a contributor to the health benefits fund conducted by the registered organization because the person subscribes to an out‑of‑hospital insurance plan offered by a registered organization—a period specified under section 73BDEE by the registered organization offering the plan as the waiting period in respect of the plan.
7  Subsection 4(1)
Insert:
reimbursable gap charge, in relation to an out‑of‑hospital service, means the gap charge for that service, or any part of the gap charge for that service, if:
	(a)	the out‑of‑hospital service is provided to a person covered by an out‑of‑hospital insurance plan; and
	(b)	the gap charge is not incurred during a period that is a waiting period imposed in respect of the persons covered by the plan; and
	(c)	the gap charge, or that part of the gap charge, has not been counted by the Health Insurance Commission in establishing that the gap charge threshold has been reached in relation to that plan and the year in which the service was provided.
8  Subsection 67(4) (after paragraph (a) of the definition of health insurance business)
Insert:
	(aa)	with respect to loss arising out of a liability to pay fees or charges in relation to the provision in Australia of an out‑of‑hospital service; or
9  Subsection 73AAI(2) (after paragraph (a) of the definition of health insurance product)
Insert:
	(aa)	any out‑of‑hospital insurance plan; or
10  Paragraphs 73AAJ(a) and (b)
After “paragraph (ba) of Schedule 1)” (wherever occurring), insert “or in accordance with an out‑of‑hospital insurance plan of the organization”.
11  Paragraph 73AAJ(c)
Omit “whether or not”, substitute “so far as an applicable benefits arrangement of the organization is concerned—whether or not”.
12  Paragraph 73AAJ(d)
After “an applicable benefits arrangement”, insert “, or an out‑of‑hospital insurance plan”.
13  After Division 4A of Part VI
Insert:
Division 4B—Out‑of‑hospital insurance plans
73BDEB  Definition
		In this Division:
insurance plan means an out‑of‑hospital insurance plan offered under section 73BDEC.
73BDEC  Registered organization may offer insurance plans
	(1)	A registered organization may, at any time, offer a contract of private health insurance that constitutes an out‑of‑hospital insurance plan.
	(2)	An insurance plan takes effect from the date specified in the plan.
	(3)	The date specified cannot be earlier than 1 January 2004 or the date on which a person becomes a party to the contract of insurance, whichever occurs last.
	(4)	An insurance plan must be distinct from any other contract of private health insurance offered by the registered organization.
	(5)	An insurance plan must not exclude, by way of election or otherwise, any out‑of‑hospital services.
	(6)	Subject to section 73BDED, a registered organization offering an out‑of‑hospital insurance plan must not deny access to persons who wish to enter the contract of insurance or be covered by it, except to the extent provided by the definition of restricted membership organization in subsection 4(1).
73BDED  Who may be covered by an insurance plan
		If an insurance plan covers more than one person, then each person, other than a person:
	(a)	who is already a contributor to the health benefits fund conducted by the registered organization offering the plan and who subscribes to the plan; or
	(b)	who becomes a contributor to the health benefits fund conducted by the registered organization offering the plan by reason of subscribing to the plan;
must be a dependant of that contributor.
Note:	Subsection 4(1) includes a definition of dependant, in relation to a contributor to a health benefits fund conducted by a registered organization.
73BDEE  Waiting periods
	(1)	Subject to subsection (2) and to section 73BAA, a registered organization may, in relation to the person, or all persons, covered by an insurance plan, specify a waiting period of not more than 6 months from the date the plan was first entered into.
	(2)	A registered organization may not specify a waiting period:
	(a)	in respect of a person:
	(i)	who is already a contributor to the health benefits fund conducted by the registered organization offering the plan and who subscribes to the plan; or
	(ii)	who becomes a contributor to the health benefits fund conducted by the registered organization offering the plan by reason of subscribing to the plan; or
	(b)	in respect of any other person covered by an insurance plan;
if the person subscribing to the plan:
	(c)	is a member of a registered organization in relation to an applicable benefits arrangement immediately before 1 July 2003; and
	(d)	continues to be such a member in relation to such an arrangement until the person subscribes to the insurance plan.
Note:	Section 5A defines an applicable benefits arrangement.
	(3)	For the avoidance of doubt, a registered organization may not specify a waiting period in respect of any person covered by an insurance plan other than the waiting period referred to in subsection (1).
	(4)	The effect of a waiting period is that gap charges incurred in respect of any out‑of‑hospital service offered during the period to a person covered by the insurance plan are not reimbursable gap charges.
73BDEF  Registered organization may collect certain information for purposes of this Act and the Health Insurance Act 1973
	(1)	A person who proposes to enter into an insurance plan with a registered organization must notify it:
	(a)	of the identity of the person, or of each person, who is to be covered by the plan; and
	(b)	of the medicare number of the person, or of each person, who is to be covered by the plan and of the expiry date in relation to that number.
	(2)	A person who has entered into an insurance plan with a registered organization must notify it:
	(a)	if there is a change in the identity of the persons covered by an insurance plan—of the change in the identity of those persons; or
	(b)	if there is a change in the medicare number applicable to any person covered by the plan or in the expiry date in relation to that number—of the change to that number or that date;
as soon as practicable after the person becomes aware of that change.
	(3)	Information notified to a registered organization under this section is for the purpose of use:
	(a)	by the registered organization to which it is supplied; and
	(b)	if it is notified under section 73BDEG to the Health Insurance Commission—by the Commission;
in relation solely to the operation:
	(c)	of an insurance plan in respect of persons to whom the information relates that are covered by the plan; and
	(d)	of this Act and the Health Insurance Act 1973 in relation to the plan.
73BDEG  Registered organization to notify Health Insurance Commission of existence and coverage of insurance plan
	(1)	A registered organization must, as soon as practicable after a person enters into an insurance plan with the organization, notify the Health Insurance Commission:
	(a)	that the plan has been entered into; and
	(b)	the date on which the plan takes effect in accordance with section 73BDEC; and
	(c)	of the identity of the person, or of each person, who is covered by the plan; and
	(d)	of the medicare number applicable to the person, or to each person, who is covered by the plan and of the expiry date in relation to each such number; and
	(e)	of such other matters relating to an insurance plan and the persons covered by it, necessary for the Commission to undertake its functions in relation to insurance plans, as are determined in writing by the Managing Director of the Commission.
	(2)	For the purposes of paragraph (1)(e), the Managing Director of the Commission must not make a determination requiring a registered organization to provide:
	(a)	the tax file number of any person; or
	(b)	information about the physical, psychological or emotional health of any person.
	(3)	Whenever there is notified to a registered organization a change in:
	(a)	the identity of the persons covered by an insurance plan; or
	(b)	the medicare number applicable to the person, or to each person, who is covered by the plan or in the expiry date in relation to each such number;
the registered organization must, as soon as practicable after it becomes aware of that change, notify the Health Insurance Commission of the change.
	(4)	If a registered organization becomes aware that there is a change in any of the matters notified by it in relation to an insurance plan under paragraph (1)(e), the registered organization must, as soon as practicable after becoming so aware, notify the Health Insurance Commission of the change.
	(5)	A notification to the Health Insurance Commission under subsection (1), (3) or (4) is a notification solely for the purpose of enabling the Commission:
	(a)	to work out, in relation to the person or persons covered by an insurance plan, whether that person or those persons have reached the gap charge threshold in respect of a particular calendar year; and
	(b)	when that person or those persons have reached the gap charge threshold in respect of a particular calendar year, to notify the registered organization offering the plan:
	(i)	that the threshold has been reached; and
	(ii)	of the out‑of‑hospital services whose gap charges were counted, or counted in part, in reaching that threshold; and
	(iii)	if an out‑of‑hospital service was counted only in part in reaching the threshold—of the amount of the gap charge in respect of that service that was counted towards the threshold.
	(6)	Determinations made for the purposes of paragraph (1)(e) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.
73BDEH  Health Insurance Commission notification obligations
		If the Health Insurance Commission is satisfied, on the basis of claims for medicare benefits made to it, that a person or persons covered by an insurance plan have, in a particular calendar year, reached the gap charge threshold in respect of that year, the Commission must, as soon as practicable after becoming so satisfied, notify the registered organization offering the plan:
	(a)	of the fact that the gap charge threshold has been reached in respect of that person or those persons for that year; and
	(b)	of the particular services whose gap charges were counted, or counted in part, in reaching that threshold; and
	(c)	if part only of the gap charge for a particular out‑of‑hospital service was counted in reaching the threshold—of the amount of the gap charge in respect of that service that was counted towards the threshold.
73BDEI  Claim against registered organization by person covered by an insurance plan
	(1)	If:
	(a)	a person is covered by an insurance plan; and
	(b)	the Health Insurance Commission has notified the registered organization offering the plan that the gap charge threshold has been reached in respect of the plan and a particular calendar year; and
	(c)	an out‑of‑hospital service is provided to that first‑mentioned person or to another person covered by the plan in that calendar year; and
	(d)	a gap charge is paid by that first‑mentioned person or by another person covered by the plan in respect of that out‑of‑hospital service; and
	(e)	the gap charge in respect of that service is, in whole or in part, a reimbursable gap charge in respect of that out‑of‑hospital service; and
	(f)	the first‑mentioned person has the capacity, under the terms of the insurance plan, to make a claim against the registered organization offering the plan;
then, subject to subsection (2):
	(g)	the first‑mentioned person may claim payment from the organization of an amount equal to the amount of the reimbursable gap charge in respect of that service; and
	(h)	if the first‑mentioned person makes such a claim and the organization is satisfied of the matters referred to in paragraphs (a) to (f)—it must pay to the person an amount equal to the reimbursable gap charge.
	(2)	Subject to sections 73BAA and 73BDEE, a claim may not be made to the registered organization offering an insurance plan by a person covered by the plan in respect of an out‑of‑hospital service provided during a waiting period in force in respect of that plan.
	(3)	Nothing in this section excludes any other method by which a person covered by an insurance plan may be reimbursed, by the registered organization offering the plan, an amount equal to the amount of a reimbursable gap charge in respect of an out‑of‑hospital service provided to a person covered by the plan.
73BDEJ  Regulations relating to portability and other matters
	(1)	If a person who is covered by an insurance plan (the old plan) ceases to be covered by the old plan and, either immediately or at a later time, becomes covered by another insurance plan (the new plan):
	(a)	offered by the same registered organization; or
	(b)	offered by another registered organization;
the regulations may set out the principles governing:
	(c)	the application in relation to the new plan of any waiting period served, or partly served, in relation to the old plan; and
	(d)	the counting towards a gap charge threshold relevant to the new plan of any gap charges incurred in relation to out‑of‑hospital services that would have counted towards a gap charge threshold in relation to the old plan.
	(2)	The regulations made for the purposes of subsection (1) apply to the exclusion of the principles set out in paragraphs (l), (la), (laa), (lab), (lb), (lba), (lc), (ld) and (le) of Schedule 1 to the National Health Act 1953.
14  Paragraph 73BF(1)(a)
After “an applicable benefits arrangement”, insert “or an out‑of‑hospital insurance plan”.
15  Subsection 73BF(1)
Omit “in respect of that applicable benefits arrangement to the fund”, substitute “to the fund in respect of that applicable benefits arrangement or that out‑of‑hospital insurance plan”.
16  Subparagraph 73BF(3)(c)(i)
After “the applicable benefits arrangement”, insert “or out‑of‑hospital insurance plan”.
17  Subparagraph 73BF(4)(a)(i)
After “the applicable benefits arrangement”, insert “or out‑of‑hospital insurance plan”.
18  Paragraph 73BF(4)(a)
Omit all the words after subparagraph (ii), substitute:
		direct the organization to admit the person as a contributor to the fund in respect of the applicable benefits arrangement or the out‑of‑hospital insurance plan to which the request relates; or
19  Subsection 73BFA(1)
Omit all the words after “a contributor”, substitute “to the health benefits fund conducted by the organization in respect of an applicable benefits arrangement or an out‑of‑hospital insurance plan, the person may request the Minister to direct the organization to accept the person’s contributions to that fund in respect of that arrangement or that insurance plan”.
20  Subparagraph 73BFA(3)(c)(i)
After “an applicable benefits arrangement”, insert “or an out‑of‑hospital insurance plan”.
21  Subsection 73BFB(1)
After “the applicable benefits arrangement”, insert “or out‑of‑hospital insurance plan”.
22  Paragraph 73BFB(4)(a)
After “the applicable benefits arrangement”, insert “or out‑of‑hospital insurance plan”.
23  Subsection 82ZQ(1) (after paragraph (e) of the definition of private health insurance arrangement)
Insert:
	(ea)	an out‑of‑hospital insurance plan;
24  Paragraph (b) of Schedule 1
After “any applicable benefits arrangement”, insert “or out‑of‑hospital insurance plan”.
25  Paragraph (be) of Schedule 1
Omit “that applicable benefits arrangement”, substitute “the applicable benefits arrangement or out‑of‑hospital insurance plan by virtue of contribution to which they are, or are eligible to become, contributors to the health benefits fund”.
26  Paragraph (g) of Schedule 1
After “paragraph (ba))” (first occurring), insert “or with an out‑of‑hospital insurance plan of the organization”.
27  Subparagraph (g)(ii) of Schedule 1
After “paragraph (ba))”, insert “or that insurance plan”.
28  At the end of paragraph (lf) of Schedule 1
Add “or with any other provisions of this Act”.
29  Subparagraphs (m)(i) and (ii) of Schedule 1
After “paragraph (ba))” (wherever occurring), insert “or an out‑of‑hospital insurance plan of the organization”.
30  Subparagraph (m)(iii) of Schedule 1
After “applicable benefits arrangement”, insert “or an out‑of‑hospital insurance plan”.
31  Paragraph (ma) of Schedule 1
After “under an applicable benefits arrangement”, insert “or an out‑of‑hospital insurance plan”.
32  Paragraph (q) of Schedule 1
After “each applicable benefits arrangement,”, insert “for each out‑of‑hospital insurance plan,”.
33  Subparagraphs (q)(i), (ii), (iii) and (iv) of Schedule 1
After “the arrangement”(wherever occurring), insert “, insurance plan”.
34  Paragraph (s) of Schedule 1
After “an applicable benefits arrangement”, insert “or an out‑of‑hospital insurance plan”.
35  Subparagraph (t)(ii) of Schedule 1
Omit “or table of ancillary health benefits”, substitute “, an out‑of‑hospital insurance plan, or a table of ancillary health benefits,”.
Private Health Insurance Incentives Act 1998
36  Paragraph 19‑1(2)(e)
Omit “or *combined cover”, substitute “, *combined cover or *out‑of‑hospital services cover”.
37  Section 20‑5 (paragraph (a) of the definition of appropriate private health insurance policy)
Omit “or *combined cover”, substitute “, *combined cover or *out‑of‑hospital services cover”.
38  Section 20‑5
Insert:
out‑of‑hospital services cover: a *private health insurance policy provides out‑of‑hospital services cover if it is cover under an out‑of‑hospital insurance plan offered by a registered organization under Division 4B of Part VI of the National Health Act 1953.
39  Section 20‑5 (at the end of the definition of type of cover)
Add:
	; or (d)	*out‑of‑hospital services cover.

Schedule 2—Concessional safety‑net
  
Health Insurance Act 1973
1  Subsection 8(1A)
Insert:
concessional person: a person is a concessional person in relation to a year at all times after the first time in that year that the person is a concessional beneficiary for the purposes of Part VII of the National Health Act 1953 (which deals with pharmaceutical benefits).
2  Subsection 8(1A)
Insert:
concessional safety‑net amount means $500.
Note:	The concessional safety‑net amount is indexed under section 10A.
3  Subsection 8(1A) (paragraph (b) of the definition of patient contribution)
Omit “10AC or 10AD”, substitute “10AC, 10ACA, 10AD or 10ADA”.
4  Subsection 8(1A) (at the end of the definition of safety‑net amount)
Add:
Note:	The safety‑net amount is indexed under section 10A.
5  Section 9
After “this Part”, insert “(other than sections 10ACA and 10ADA)”.
6  Paragraph 10AB(1)(d)
After “10AC”, insert “or 10ACA”.
7  Paragraph 10AB(2)(d)
After “10AC”, insert “or 10ACA”.
8  Subsection 10AB(2)
Omit “section 10AD”, substitute “sections 10AD and 10ADA”.
9  Subsection 10AB(2)
Omit “dealt with under section 10AC”, substitute “dealt with under sections 10AC and 10ACA”.
10  Paragraph 10AB(3)(b)
After “10AC”, insert “or 10ACA”.
11  Paragraph 10AB(3)(e)
Omit “section 10AC”, substitute “sections 10AC and 10ACA”.
12  After subsection 10AC(2)
Insert:
	(2A)	The patient contributions under subparagraph (2)(c)(ii) (including for the purpose of subparagraph (2)(c)(iii)) are to be reduced by so much of those patient contributions as have been paid as increased benefits under section 10ACA. For this purpose, an amount of a patient contribution is taken to have been paid as an increased benefit under section 10ACA to the extent that the amount of the increase in the benefit payable for the relevant service exceeds the difference between the total medical expenses incurred in respect of the relevant service and the Schedule fee for the relevant service.
13  After section 10AC
Insert:
10ACA  Concessional safety‑net—families with concessional members
	(1)	In this section:
relevant service means a service:
	(a)	in respect of which benefit is payable; and
	(b)	the medical expenses in respect of which exceed the amount of benefit that, apart from this section, would be payable in respect of the service;
but does not include a service of the kind referred to in subparagraph (a)(ii) and paragraph (b) of the definition of applicable benefits arrangement in subsection 5A(1) of the National Health Act 1953.
year means a calendar year.
	(2)	Subject to this Act, if this section applies to a claim (the current claim), the benefit payable in respect of the claim is increased by 80% of the out‑of‑pocket expenses for the current claim.
	(3)	The out‑of‑pocket expenses for a claim are:
	(a)	the medical expenses incurred in respect of a relevant service for which the claim is made;
reduced by:
	(b)	any amounts payable under any other section of this Act in respect of those expenses.
	(4)	This section applies to the current claim if:
	(a)	the current claim is a claim that is made by a claimant for a benefit in respect of a relevant service which was rendered to the claimant or to a member of the claimant’s registered family; and
	(b)	the medical expenses incurred in respect of the relevant service are incurred in a year (the expense year); and
	(c)	the claimant has paid at least 20% of the out‑of‑pocket expenses for the service directly to the person by whom, or on whose behalf, the service was rendered; and
	(d)	the current claim is accepted by the Commission; and
	(e)	the person to whom the service was rendered is a concessional person in relation to the expense year at the time that the claim is made; and
	(f)	the concessional safety‑net applies to the current claim.
Note:	Subsection 10AC(3) deals with a person being a member of more than one family.
	(5)	The concessional safety‑net applies to the current claim if the Commission is satisfied at the time when the current claim was accepted for payment that the sum of the out‑of‑pocket expenses for the current claim and all relevant prior claims for the expense year is equal to or exceeds the concessional safety‑net amount.
	(6)	A claim is a relevant prior claim for the expense year if:
	(a)	the claim has been made for benefit in respect of relevant services which were rendered to any member of the family who is a concessional person in relation to the expense year at the time that the current claim is made; and
	(b)	the claim is related to medical expenses incurred during the expense year; and
	(c)	the claim was accepted for payment by the Commission before the time when the current claim was accepted for payment; and
	(d)	the Commission is satisfied at the time when the current claim was accepted for payment that the out‑of‑pocket expenses for the claim have been paid.
	(7)	If:
	(a)	this section applies to the current claim; but
	(b)	the sum of the out‑of‑pocket expenses for all relevant prior claims for the expense year is less than the concessional safety‑net amount;
the benefit payable in respect of the claim is not increased under subsection (2) but is instead increased by the amount worked out using the formula:

where:
balance of safety‑net means the amount by which the sum of the out‑of‑pocket expenses for all relevant prior claims for the expense year is less than the concessional safety‑net amount.
	(8)	This section applies only to a benefit that becomes payable after a family becomes registered, even though expenses incurred before the registration in the year the family becomes registered may be taken into account for the purposes of determining whether the concessional safety‑net applies.
	(9)	For the purposes of this section (other than paragraph (4)(c)), without affecting the meaning of an expression in any other provision of this Act, if a person to whom benefit is payable in respect of a relevant service is given or sent a cheque under subsection 20(2) for the amount of the benefit, the person is taken to have paid so much of the medical expenses in respect of that service as is represented by the amount of the benefit.
	(10)	For the purposes of this section, without affecting the meaning of an expression in any other provision of this Act, despite anything else in this Act, the question when medical expenses are incurred in respect of relevant services relating to prescribed items is to be determined under the regulations.
14  After subsection 10AD(3)
Insert:
	(3A)	The patient contributions under subparagraph (3)(c)(ii) (including for the purpose of paragraph (3)(c)(iii)) are to be reduced by so much of those patient contributions as have been paid as increased benefits under section 10ADA. For this purpose, an amount of a patient contribution is taken to have been paid as an increased benefit under section 10ADA to the extent that the amount of the increase in the benefit payable for the relevant service exceeds the difference between the total medical expenses incurred in respect of the relevant service and the Schedule fee for the relevant service.
15  After section 10AD
Insert:
10ADA  Concessional safety‑net—individuals
	(1)	Expressions used in this section have the same meaning as in section 10ACA.
	(2)	Subject to subsection 10AB(3), this section applies to a person who is not a member of a registered family.
	(3)	Subject to this Act, if this section applies to a claim (the current claim), the benefit payable in respect of the claim is increased by 80% of the out‑of‑pocket expenses for the current claim.
	(4)	The out‑of‑pocket expenses for a claim are:
	(a)	the medical expenses incurred in respect of a relevant service for which the claim is made;
reduced by:
	(b)	any amounts payable under any other section of this Act in respect of those expenses.
	(5)	This section applies to the current claim if:
	(a)	the current claim is a claim that is made by the person for a benefit in respect of a relevant service which was rendered to the person; and
	(b)	the medical expenses incurred in respect of the relevant service are incurred in a year (the expense year); and
	(c)	the person has paid at least 20% of the out‑of‑pocket expenses for the service directly to the person by whom, or on whose behalf, the service was rendered; and
	(d)	the current claim is accepted by the Commission; and
	(e)	the person is a concessional person in relation to the expense year at the time that the claim is made; and
	(f)	the concessional safety‑net applies to the current claim.
	(6)	The concessional safety‑net applies to the current claim if the Commission is satisfied at the time when the current claim was accepted for payment that the sum of the out‑of‑pocket expenses for the current claim and all relevant prior claims for the expense year is equal to or exceeds the concessional safety‑net amount.
	(7)	A claim is a relevant prior claim for the expense year if:
	(a)	the claim has been made for benefit in respect of relevant services which were rendered to the person; and
	(b)	the claim is related to medical expenses incurred during the expense year; and
	(c)	the claim was accepted for payment by the Commission before the time when the current claim was accepted for payment; and
	(d)	the Commission is satisfied at the time when the current claim was accepted for payment that the out‑of‑pocket expenses for the claim have been paid.
	(8)	If:
	(a)	this section applies to the current claim; but
	(b)	the sum of the out‑of‑pocket expenses for all relevant prior claims for the expense year is less than the concessional safety‑net amount;
the benefit payable in respect of the claim is not increased under subsection (3) but is instead increased by the amount worked out using the formula:

where:
balance of safety‑net means the amount by which the sum of the out‑of‑pocket expenses for all relevant prior claims for the expense year is less than the concessional safety‑net amount.
	(9)	For the purposes of this section (other than paragraph (5)(c)), without affecting the meaning of an expression in any other provision of this Act, if a person to whom benefit is payable in respect of a relevant service is given or sent a cheque under subsection 20(2) for the amount of the benefit, the person is taken to have paid so much of the medical expenses in respect of that service as is represented by the amount of the benefit.
	(10)	For the purposes of this section, without affecting the meaning of an expression in any other provision of this Act, despite anything else in this Act, the question when medical expenses are incurred in respect of relevant services relating to prescribed items is to be determined under the regulations.
16  Subsection 10AE(1)
After “10AC”, insert “or 10ACA”.
17  Subsection 10AE(2)
After “10AC”, insert “or 10ACA”.
18  Subsection 10A(1) (at the end of the definition of year)
Add:
	; or (d)	for the purpose of the indexation of the concessional safety‑net amount—the year beginning on 1 January 2004 or a later year beginning on 1 January.
19  Subsection 10A(2) (at the end of the table)
Add:
4.	The concessional safety‑net amount	1 January	September	
20  Application
The amendments made by this Schedule apply to expenses incurred on or after 1 January 2004.

Schedule 3—General Practice Access Scheme
  
Health Insurance Act 1973
1  After subsection 20A(1)
Insert:
	(1A)	If:
	(a)	a professional service that is rendered by, or on behalf of, a person (the practitioner) is covered by an arrangement entered into (whether by the practitioner or another person) with the Managing Director of the Commission under a scheme known as the General Practice Access Scheme; and
	(b)	a medicare benefit would, apart from this section, be payable to the eligible person or another eligible person in respect of the professional service;
the person to whom the medicare benefit would, apart from this section, be payable may enter into an agreement with the practitioner under which the person assigns his or her right to the payment of the medicare benefit to the practitioner. The agreement must be in accordance with the approved form.
2  Subsection 20B(2)
After “section 20A”, insert “(other than subsection 20A(1A))”.
3  After subsection 20B(2A)
Insert:
	(2B)	A claim for a medicare benefit assigned under subsection 20A(1A) must:
	(a)	be made in accordance with the approved form; and
	(b)	unless the Managing Director of the Commission determines otherwise—be sent to the Commission by means of an electronic transmission in such manner as the Managing Director of the Commission determines; and
	(c)	be sent to the Commission within the period of 6 months, or such longer period as is allowed in accordance with subsection (3A), after the rendering of the professional service to which the benefit relates.
4  Subsection 20B(3)
After “subsection (2)”, insert “or (2B)”.
5  Paragraph 20B(3)(c)
After “20A(1)”, insert “or (1A)”.
6  Paragraph 20B(3)(d)
After “20A(1)”, insert “or (1A)”.
7  Subsection 20B(3A)
After “paragraph (2)(b)”, insert “or (2B)(c)”.
8  Subsection 127(1)
After “under subsection 20A(1)”, insert “or (1A)”.
9  Paragraph 127(1)(a)
After “20A(1)”, insert “or (1A) (as the case requires)”.
10  Application
(1)	Subject to subitem (2), the amendments made by this Schedule apply to expenses incurred on or after 1 February 2004.
(2)	The Minister may, by written notice made before 1 February 2004, provide that amendments made by this Schedule apply to expenses incurred on or after a day specified in the notice.
(3)	The day specified in the notice must not be earlier than the day after the day on which the notice is made and must not be later than 1 July 2004.
(4)	A notice under subitem (2) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.