Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2019
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
Private Health Insurance Legislation Amendment (Fairer Rules for General Treatments) Bill 2019
EXPLANATORY MEMORANDUM
and
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Circulated by authority of
Andrew Wilkie MP
Private Health Insurance Legislation Amendment (Fairer Rules for General Treatments) Bill 2019
OUTLINE
This bill amends relevant legislation to prevent private health insurers awarding differential
rebates for the same treatments provided under the same product in the same jurisdiction. It also
gives the Australian Prudential Regulation Authority (APRA) the ability to intervene if private
health insurers are inappropriately using information obtained from Health Industry Claims and
Payments Service (HICAPS) to manipulate the market. Both of these amendments enshrine
recommendation 12 of the 2017 Report into the Value and Affordability of Private Health
Insurance and Out-of-Pocket Medical Costs conducted by the Senate Standing Committee on
Community Affairs. This bill also prevents private health funds from being both insurers and
service providers of general health treatments.
FINANCIAL IMPACT
The bill will have no financial impact.
NOTES ON CLAUSES
Clause 1: Short Title
1. This clause is a formal provision and specifies the short title of the bill as the Private Health
Insurance Legislation Amendment (Fairer Rules for General Treatments) Act 2019.
Clause 2: Commencement
2. This clause provides for the commencement of the Act on the day after it receives Royal
Assent.
Clause 3: Schedules
3. This clause establishes that, as the intent of the bill is to be realised through amendments
to other Acts, the Schedules of this bill will amend those Acts accordingly.
Schedule 1
Private Health Insurance Act 2007
Item 1: After paragraph 55-5(2)(g)
1. Item 1 expands the definition of 'improper discrimination' in the Private Health Insurance
Act 2007. It states that discrimination by a private health insurer, as to the health care
provider a person chooses for their general treatment, may constitute improper
discrimination on the part of the private health insurer.
Private Health Insurance (Prudential Supervision) Act 2015
Item 2: Section 4
2. Item 2 inserts a definition of "general treatment" into the Private Health Insurance
(Prudential Supervision) Act 2015.
Item 3: Section 14
3. Item 3 is a procedural provision, allowing for the implementation of Item 4.
Item 4: At the end of section 14
4. Item 4 inserts a provision that prevents a body registering as a private health insurer if they
assume the dual role of also conducting health-related business, such as providing general
treatments. For example, a private health insurer will not be able to conduct dental
treatments or optometry services. However, this section will not apply to general
treatments provided within an aged care facility.
Item 5: At the end of subsection 21(1)
5. Item 5 inserts a provision relating to the cancellation of a private health insurer's
registration, being that registration may be cancelled by APRA if the insurer conducts a
health-related business, including by providing general treatments. However, this section
will not apply to general treatments provided within an aged care facility.
Item 6: At the end of section 96
6. Item 6 gives APRA the authority to give direction to private health insurers to change their
conduct if it believes the private health insurer is inappropriately using information gained
from HICAPS to gain a competitive advantage in the private health insurance market. This
will prevent private health insurance companies from knowing sensitive information about
their competition, and thereby minimise the growing monopolisation that the private
health insurance companies have in the market.
Item 7: Application provision
7. Item 7 specifies that the amendments made in this Act will apply to conduct after this Act
commences, meaning that the Act will not be applied retrospectively.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Private Health Insurance Legislation Amendment (Fairer Rules for General Treatments) Bill 2019
This bill is compatible with the human rights and freedoms recognised or declared in the
international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act
2011.
Overview of the bill
This bill amends relevant legislation to prevent private health insurers awarding differential
rebates for the same treatments provided under the same product in the same jurisdiction. It also
gives the Australian Prudential Regulation Authority (APRA) the ability to intervene if private
health insurers are inappropriately using information obtained from HICAPS to manipulate the
market. Both of these amendments enshrine recommendation 12 of the 2017 Report into the
Value and Affordability of Private Health Insurance and Out-of-Pocket Medical Costs conducted by
the Senate Standing Committee on Community Affairs. This bill also prevents private health funds
from being both insurers and service providers of general health treatments.
Human rights implications
This bill is necessary to ensure the right to healthcare, as enshrined in international agreements
such as the International Covenant on Economic, Social and Cultural Rights, the United Nations
Convention on the Rights of the Child, the Convention on the Rights of Persons with Disabilities, the
Convention on the Elimination of All Forms of Discrimination Against Women, and the Convention
on the Elimination of All Forms of Racial Discrimination. It prevents private health insurers from
discriminating again patients seeking general treatments on the basis of the patient's choice of
private health care provider. In doing so, this bill promotes the right of everyone to enjoy the
highest attainable standard of physical and mental health.
Conclusion
This bill is compatible with human rights because it strengthens human rights, particularly the
right to healthcare.
Andrew Wilkie MP