Explanatory Memorandum
(Circulated by authority of the Minister for Health and Ageing, the Honourable Tony Abbott MP)OUTLINE
PRIVATE HEALTH INSURANCE BILL 2006
This Bill sets out a comprehensive regulatory regime for the private health insurance sector, replacing the current regime which is mainly set out in the National Health Act 1953 , the Health Insurance Act 1973 and the Private Health Insurance Incentives Act 1998 .
Chapter 1 of the Bill deals with preliminary matters, including how terms are defined, the structure of the Bill, and Constitutional issues.
Chapter 2 of the Bill provides incentives for people to purchase insurance, including rebates on the cost of premiums and penalties for people purchasing insurance after their 31st birthday.
Chapter 3 of the Bill sets out the rules with which health insurance products must comply to meet the requirements of the Bill. These include adherence to the principle of community rating as well as premium, benefit, waiting period, portability, quality assurance, and information provision requirements.
Chapter 4 imposes obligations on private health insurers. It defines health insurance business and creates an offence to carry on such business without being registered under the Bill, establishes a registration regime, provides for insurers to carry on their business through health benefits funds subject to prudential supervision, and requires insurers to meet other prudential and administrative obligations. It also sets out rules for the restructuring or termination of health benefits funds.
Chapter 5 provides for enforcement of the Bill. It empowers the Minister and the Private Health Insurance Administration Council ("the Council") to take a range of actions to encourage or compel insurers to comply with the Bill. It also empowers the Council to appoint an inspector to examine the affairs of a health benefits fund, and appoint an external manager to carry on the business of the fund in certain circumstances.
Chapter 6 contains a range of provisions of an administrative nature, including establishment of the Private Health Insurance Ombudsman and the Council, setting out the powers of external and terminating managers, safeguarding information acquired in administering the Bill, and the approval of forms under the Bill and the making of subordinate legislation known as Private Health Insurance ([subject matter]) Rules as legislative instruments.
Schedule 1 is a Dictionary which either defines terms used in the Bill or references the sections in the Bill where they are defined.
PRIVATE HEALTH INSURANCE (TRANSITIONAL PROVISIONS AND CONSEQUENTIAL AMENDMENTS) BILL 2006
This Bill (the Transitional and Consequential Bill) provides for the transition from the current regulatory regime to the new Private Health Insurance Bill. It also provides for the repeal of redundant Parts of the National Health Act 1953 and Health Insurance Act 1973 and makes amendments to a range of other Acts, mainly to reflect changes in the definitions of insurers and the products they offer.
PRIVATE HEALTH INSURANCE (PROSTHESES APPLICATION AND LISTING FEES) BILL 2006
This Bill imposes application and listing fees on the sponsors of prostheses.
PRIVATE HEALTH INSURANCE (COLLAPSED ORGANIZATION LEVY) AMENDMENT BILL 2006
PRIVATE HEALTH INSURANCE COMPLAINTS LEVY AMENDMENT BILL 2006
PRIVATE HEALTH INSURANCE (COUNCIL ADMINISTRATION LEVY) AMENDMENT BILL 2006
PRIVATE HEALTH INSURANCE (REINSURANCE TRUST FUND LEVY) AMENDMENT BILL 2006
These four Bills (the Levy Amendment Bills) amend the Acts imposing various levies on private health insurers to update definitions resulting from the replacement of the National Health Act 1953 by the proposed Private Health Insurance Act.
FINANCIAL IMPACT
There will be no financial impact from this package of legislation.