Commonwealth of Australia Explanatory Memoranda

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HEALTH INSURANCE AMENDMENT (PROVIDER NUMBER REVIEW) BILL 2007

                           2004-2005-2006-2007




   THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA


                   HOUSE OF REPRESENTATIVES




HEALTH INSURANCE AMENDMENT (PROVIDER NUMBER REVIEW) BILL
                         2007




                   EXPLANATORY MEMORANDUM




      (Circulated by authority of the Minister for Health and Ageing,
                    the Honourable Tony Abbott MP)
HEALTH INSURANCE AMENDMENT (PROVIDER NUMBER REVIEW)
BILL 2007


OUTLINE

Purpose of the Bill
The Health Insurance Amendment (Provider Number Review) Bill proposes to change
section 19AD of the Health Insurance Act 1973 (the Act) which relates to arrangements for
reviewing the operation of sections 19AA, 3GA and 3GC of the Act, collectively known as
the Medicare provider number legislation (the legislation).

The Act currently requires that the Medicare provider number legislation must be reviewed
every two years.

This amendment is the result of comments submitted to, and deliberations undertaken at the
most recent biennial review process in 2005. The amendment provides for the review
process to be undertaken every five years (rather than the current biennial arrangements) with
the next review to commence in 2010.

The biennial review undertaken in 2005 reported that there continued to be overwhelming
agreement with the objective of the legislation, and reported that while difficult to quantify, it
was agreed that the legislation in particular is having a positive impact on raising the quality
of general practice services to the community. In addition, the workforce and training
programs monitored as part of the review have operated smoothly with positive results. The
concerns that the legislation would negatively impact on the availability of training places has
not eventuated. The process of the 2005 review was non-contentious and received
significantly less submissions than that received in 2003.

The review process takes nine months to complete and requires significant staffing resources
from the Department of Health and Ageing. With continuing wide acceptance of the
legislation, the need to conduct a review biennially is no longer critical.

Effect of the Principle Provisions
The proposed amendment would change the frequency of the review process from two years
to five years, with the next review process commencing in 2010.

The amendment will not affect the operation of any of the programs created under section
3GA of the Act, nor will it affect any medical practitioner subject to the legislation, now or in
the future.

Background to the Medicare provider number legislation - Sections 19AA, 3GA and 3GC
The Medicare provider number legislation contained within section 19AA of the Act requires
doctors to have obtained postgraduate qualifications (Fellowship) before they are able to
access the Medicare Benefits Scheme. This affects both overseas and Australian trained
doctors.

When section 19AA was introduced in 1996 a number of groups in the medical workforce
perceived this to be a risk to the future employment opportunities to the then doctors in
training. A sunset clause was included as a safeguard which ensured the legislation would be


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revoked automatically unless it was demonstrated to Parliament that there were no significant
adverse impacts on affected doctors.

The mid term review of the legislation conducted in 1999 found the legislation was working
well, and the initial fears of affected doctors had not eventuated. The review report
recommended the sunset clause be repealed. In 2001 the Act was amended removing the
sunset clause, and included a requirement under section 19AD that the operations of the
legislation be reviewed on a biennial basis.

Related parts of the Act are sections 3GA and 3GC. Section 3GA allowed for the creation of
a Register of Approved Placements which provides for the registration of medical
practitioners in approved placements which enables doctors subject to section 19AA to
provide professional services while undertaking training towards Fellowship. Section 3GC
allowed for the creation of the Medical Training Review Panel whose function includes
preparing reports on the numbers of practitioners enrolled in courses and programs, and their
types and availability.


FINANCIAL IMPACT STATEMENT

The 2005 review process, in terms of engaging an independent reviewer, cost the Department
of Health and Ageing $80,000 which included transport and accommodation costs incurred
during the consultation process. In addition, two senior officers from the Department were
seconded on a full time basis for approximately nine months for secretariat duties. In total,
the 2005 biennial review process exceeded $180,000.

With the proposed amendment, this financial impact will be incurred every five years rather
than every two years.




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HEALTH INSURANCE AMENDMENT (PROVIDER NUMBER REVIEW)
BILL 2007


NOTES ON CLAUSES

Clause 1 - Short Title

This clause sets out the short title of the Bill.

Clause 2 - Commencement

This clause provides for the Bill to commence on the day on which it receives Royal Assent.

Clause 3 - Schedule(s)

This clause provides that each Act that is specified in the Schedule to this Act is amended or
repealed as set out in the applicable items in the Schedule.

SCHEDULE 1 - AMENDMENTS TO THE HEALTH INSURANCE ACT 1973

Item 1
Paragraphs 19AD(1)(a) and (b) of the Act currently provide that a report on the operation of
sections 3GA, 3GC and 19AA of the Act must be tabled in Parliament by the Minister on or
before 31 December 1999 (that is, following the first review of these provisions) and by the
end of each subsequent two year period.

This item will repeal those paragraphs and substitute new subsections 19AD(1)(a) and (b)
which will provide that such a report on the operation of section 3GA, 3GC and 19AA must
be tabled on or before 31 December 2010 (that is, following the first review following this
amendment) and by the end of each subsequent five year period.

This amendment will allow for the next review process to be undertaken in 2010 rather than
2007 as is required with the current legislation and allows for a five year period between
reviews.

Item 2
Subsection 19AD(2) of the Act currently provides that, within three months after a report on
the operation of sections 3GA, 3GC and 19AA of the Act is tabled, the Medical Training
Review Panel must convene a meeting to discuss the report.

This item will omit the reference in subsection 19AD(2) to paragraph 19AD(1)(b) and
substitute reference to subsection 19AD(1). This will ensure that such a meeting is convened
regardless of whether a report is tabled in accordance with paragraph (a) or (b), that is,
whether the report is that following the 2010 review or a report following one of the
subsequent five yearly reviews.

This amendment continues to require the Medical Training Review Panel to convene a
meeting. However, it clearly indicates that the intent of the whole of subsection 19AD(1) is
to be considered rather than only paragraph (b).


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