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CONTENTS
Health Legislation Amendment Bill 1997
Date Introduced: 1 October 1997
House: House of Representatives
Portfolio: Health and Family Services
Commencement: Apart from the provisions relating
to the supply of pharmaceuticals by private hospitals and
residential aged care services which commence on 1 May 1998, the
significant provisions of this Bill commence on the day on which
the Act receives the Royal Assent.
To make a number of amendments to certain health related
legislation in respect of the following topics:
- approval of hedging contracts entered into by the Health
Insurance Commission
- electronic payment of Medicare benefits
- fees chargeable by optometrists
- Medicare benefits in respect of services rendered outside
Australia
- medical practitioners receiving payment for the provision of
public hospital services
- the provision of pharmaceuticals by private hospitals and
residential aged care services
Electronic Claiming for Medicare Benefits
This measure proposes the introduction of electronic claiming of
Medicare benefits directly from doctors' surgeries and the
electronic transmission of rebates to the accounts of patients and
medical practitioners. Previously, only direct billed (bulk-billed)
claims could be lodged electronically.Under this measure, it will
be possible to lodge electronically both a patient claim (where the
bill has been paid) and a pay doctor claim (where the bill has not
been paid).
The amendments also provide for the electronic payment of
Medicare rebates into bank, building society or credit union
accounts. The 1997-98 Budget papers indicate that the
implementation of this measure is expected to result in increased
outlays of $28.1 million over four years due to the increased costs
to Medicare benefits because of reduced payment delays from
electronic claiming. These increased outlays are expected to be
'short term costs only and will not be relevant when the new system
is fully implemented'(1).
Optometry
As a condition of their participation in Medicare, optometrists
are required to sign an undertaking which, amongst other
provisions, prohibits them charging above the schedule fee for any
item in the Schedule of Medicare Benefits for Consultations by
Optometrists (approximately 96 per cent of optometrical services
are direct billed at no cost to the patient). All other
practitioners who participate in Medicare may charge any fee they
wish and are not restricted to charging the schedule fee.
This measure proposes that optometrists be permitted to charge
above the schedule fee in certain circumstances, specified in a
revised optometrical undertaking, which has been developed in
consultation with the Australian Optometrical Association. These
amendments will apply in cases where a patient receives an initial
comprehensive consultation within 24 months of a previous
consultation.
It is accepted by the Commonwealth and the Australian
Optometrical Association that 24 months is a suitable interval for
'check-up' consultations. Other items in the optometry schedule
apply where a problem arises with a patient's vision within this 24
month period. Optometrists seeking to charge above the schedule fee
in the specified circumstances are required to advise the patient
prior to the consultation of the total cost of the consultation and
the amount of rebate the patient can expect to receive. In cases
where an optometrist charges above the schedule fee, the patient
will bear the increased out-of-pocket cost.
These measures are included in the Schedule of Medicare Benefits
for Consultations by Optometrists, effective 1 November 1997.
Charging public hospital patients for services
The Medicare Agreements between the Commonwealth and each State
and Territory specify that:
hospital services in the State are available to all eligible
persons without charge as public patients; and
out-patient and accident and emergency services are, subject to
subclause 10.4, provided to eligible persons free of charge
(subclause 10.4 specifies some services which do not have to be
provided free of charge to out-patients such as dental services and
pharmaceuticals)(2).
Instances have arisen in various States whereby public hospital
patients have been offered inducements such as queue-jumping on
waiting lists for elective surgery, in return for payment. This
amendment proposes to provide for a penalty to be levied on a
medical practitioner who charges a public patient for the provision
of public hospital services in certain prescribed circumstances.
The prescribed circumstances will be set out in regulations. The
thrust of this provision is directed at unethical behaviour by
individual medical practitioners.
Immunisation
The Australian Childhood Immunisation Register was established
in January 1996 to 'assist in the monitoring of immunisation
coverage at a national state and local level and to enable
providers and parents to obtain a record of a child's immunisation
history'(3). At 30 June 1997 some 15 408 immunisation providers had
provided information to the Registrar and more than 3 million valid
vaccinations were recorded during the financial year. This measure
proposes that de-identified data be released from the Register for
research purposes. In her second reading speech on the Bill, the
Parliamentary Secretary to the Minister for Health and Family
Services, Hon Trish Worth MP, noted that advice from the Privacy
Commissioner indicated that the release of information from the
Register in this way 'is not in conflict with privacy
principles'.
Medicare benefits and overseas travel
Medicare benefits are not payable for treatment received by
Australian residents when travelling overseas. Access to Medicare
benefits is currently denied once a resident has travelled beyond
the twelve kilometre territorial sea limit, which can also have the
effect of denying Australian residents access to benefits should
they receive medical treatment during some domestic journeys. This
measure proposes to insert into the Health Insurance Act
1973 a new concept of 'domestic journey', which will enable
Australian residents receiving medical treatment during a journey
to have access to Medicare benefits for that treatment. The
definition of 'domestic journey' will include domestic travel prior
to or at the end of an international flight and will also include
overseas journeys where a patient is required through ill health to
return to Australia before arrival at the intended overseas
destination (without having had any stopovers).
Pharmaceutical Benefits Scheme
The Health Legislation Amendment Bill 1997 also proposes
amendments to the operation of the Pharmaceutical Benefits Scheme
(PBS) in relation to residential care facilities (nursing homes and
hostels) and private hospitals. The present situation is that a
medical practitioner must write a prescription for the supply of a
drug for an individual patient and the prescription is then filled
by a pharmacist who is reimbursed by the Commonwealth. The
amendments propose to permit a pharmacist to be reimbursed by the
Commonwealth for the supply in bulk of certain drugs (eg
painkillers) to a private hospital or residential care facility
following the prescribing of the bulk supply of the drug by a
medical practitioner. The drugs can then be dispensed to patients
within the institution as required.
Some savings can be expected as a result of this measure,
arising from fewer prescriptions being written and savings in
dispensing costs due to larger quantities of drugs per
prescription. The drugs affected by this measure will be specified
in a determination by the Minister. The new prescription order form
(which is likely to be similar to the existing 'doctor's bag'
arrangements) will be presented as an amendment to the regulations
under the National Health Act 1953.
It should be noted that an incorrect statement is included in
the Explanatory Memorandum to the Bill in relation to these
proposed amendments to the PBS. In the 'outline' (page 1) of the
Explanatory Memorandum, the seventh paragraph includes the
statement that the Bill:
introduces a system which will enable a private hospital
or residential care facility to be reimbursed for the
administration of some pharmaceutical benefits to its patients or
residents from the institution's own stocks. (emphasis added)
This statement is also included in the Parliamentary Secretary's
second reading speech. These statements are incorrect. Schedule 3
of the Explanatory Memorandum correctly describes the insertion of
new section 93A which will 'enable approved
suppliers to be reimbursed for the supply to institutions
such as private hospitals and residential care facilities of
certain pharmaceutical benefits administered to patients of the
institution from stocks held by the institution'. The effect of the
amendments will be to permit the supplier (pharmacist) to be
reimbursed by the Commonwealth, not the institution (private
hospital, nursing home or hostel).
The amendments made by this Bill are incorporated into 4
Schedules.The fourth Schedule contains a minor amendment which
corrects a drafting error and will not be considered. The main
provisions will be summarised under headings of the first three
Schedules.
Schedule 1 - Amendment of the Health Insurance Commission
Act 1973
Section 36AA of the Health Insurance Commission Act
1973 (HIC Act) permits the Health Insurance Commission (HIC)
to enter into various types of hedging contracts where the hedging
relates to borrowing or investments by the HIC or a transaction in
a foreign currency.A hedging contract is a type of transaction
designed to offset potential losses which may occur as a result of,
for example, inflation or foreign currency fluctuations.Some
specific types of hedging contracts referred to in section 36AA
are:
- forward exchange rate contracts
- contracts with respect to currency futures
- contracts with respect to financial futures
- interest rate contracts
- contracts relating to dealings known as currency swaps
- contracts relating to dealings known as interest rate
swaps
The Minister for Health and Family Services (Minister) is
empowered to determine guidelines to be followed by the HIC in the
exercise of this power.
Section 38 of the HIC Act obliges the HIC to obtain the approval
of the Minister before entering into a contract involving the
payment or receipt of an amount of more than $10,000,000.
Item 1 of Schedule 1 amends section 38 to
remove the requirement to obtain Ministerial approval when the HIC
is entering a hedging contract under section 36AA.
Schedule 2 - Amendment of the Health Insurance Act
1973
Electronic transmission of claims for, and payments of,
Medicare benefits
Section 20 of the Health Insurance Act 1973 deals with
the payment of Medicare benefit and provides that the benefit shall
be paid in such manner as the Managing Director of the HIC
determines.Section 20A deals with the situation where a person
attends a practitioner or pathology service who 'bulk bills'.Those
practitioners and services obtain payment directly from the
HIC.Again, the Medicare benefit is payable in such manner as the
Managing Director of the HIC determines.
Items 1 and 2 make identical
amendments to sections 20 and 20A respectively.The amendments
specifically allow the Managing Director of the HIC to specify
electronic transfer to a bank, building society or credit union as
a method of payment.
Section 20B provides for the method of lodging claims.A claim
must be made in accordance with the approved form.
Items 3 to 5 amend section 20B
to provide for the electronic transmission of claims to
Medicare.
Recognition of specialists and consultant physicians
The Specialist Recognition Advisory Committee is a committee of
five practitioners established in each State.Under section 61 of
the Health Insurance Act 1973, the Minister may refer to a
Specialist Recognition Advisory Committee the question whether a
particular medical practitioner should be recognised for the
purposes of the Act as a consultant physician or as a specialist,
in a particular specialty or continue so to be recognised.When the
Committee makes a recommendation, the Minister is obliged to make a
determination giving effect to that recommendation.
Item 6 amends section 61 to allow a Committee
to recommend that the medical practitioner should be recognised as
a consultant etc. for a certain period.
Item 8 allows the Minister to revoke a
determination, in respect of recognition, after a request by the
practitioner for revocation.
Provisions relating to optometrists
A Medicare benefit is payable in respect of the provision of a
'professional service'.For a benefit to be payable in respect of
optometrical service, the optometrist must be a 'participating
optometrist', i.e. one who has agreed to give an undertaking
containing certain terms determined by the Minister (the
undertaking is determined under section 23A of the Health
Insurance Act 1973).One of the terms of that undertaking is
that the optometrist agrees not to charge a fee of more than the
fee specified for the particular service in the health insurance
fee table (referred to as the 'schedule fee').The basic fee for an
initial consultation is $51.70 (the same patient cannot have more
than one initial consultation once every two years at the
same optometrist).The basic fee for a subsequent
consultation is $26.35.
Optometrists will now, in certain circumstances, be allowed to
charge in excess of the schedule fee.
Item 11 amends section 23A to allow the
Minister to specify, in the undertaking, circumstances in which an
optometrist may charge above the Schedule fee.
The Explanatory Memorandum explains that an additional type of
service will be added to the fee table.That service will be the
provision of an initial consultation where the patient has attended
an optometrist (other than the treating optometrist) within the
last 2 years.Under those circumstances at present, the schedule fee
is $51.70.Under this proposal the schedule fee for this new service
will be only $25.90 but the optometrist will be allowed to charge
in excess of that amount up to a maximum fee of $51.70.
Digest Comment: The
Explanatory Memorandum states that the circumstances in which an
optometrist will be allowed to charge more than the schedule fee
will include a requirement that the client has agreed to pay the
additional fee having been made aware of the reduced level of
benefit available from Medicare.
This requirement to notify the client in advance is
essential.Until now, a person has been able to attend an initial
consultation with any optometrist, except one which they have
visited in the past two years, and pay a maximum difference between
the consultation fee and the Medicare reimbursed amount of about
$7.80.The maximum difference upon the commencement of this
provision could be up to about $30.00.If a client was not notified
of this possible 'gap' at the time of consultation, it could be
that the first they know about it is when they obtain their
Medicare refund and receive only $22.00 instead of $44.00.
Other Amendments
At present, there is only an entitlement to receive a Medicare
benefit where medical expenses are incurred in respect of a
professional service rendered in Australia (Section 10(1) of the
Health Insurance Act 1973).
Item 15 amends section 10(1) to provide that a
Medicare benefit will be payable even if the professional service
was rendered outside Australia where it was rendered to the person
in the course of a 'domestic journey'.A 'domestic journey' is one
which begins and ends in Australia without any intermediate
stopping place outside Australia.The term expressly includes:
- a journey that was intended to end outside Australia
- such a journey that occurs as part of a longer journey ending
or intended to end outside Australia
- a journey that is part of a longer journey that began outside
Australia
Item 22 inserts proposed new section
128C which penalises medical practitioners who charge a
fee or receive a payment for the provision of a public hospital
service if the practitioner knows that the person to whom the
service is provided is or intends to be a public patient in the
hospital.A hospital service is defined in section 23E as a health
service of a kind provided in a hospital and it includes:
- accommodation in a hospital for the purposes of
receiving treatment;
- nursing care and treatment;
- medical care and treatment including diagnostic
services; and
- outpatient, accident and emergency services.
Schedule 3 - Amendment of the National Health Act
1953
Item 3 of this Schedule inserts
proposed new section 93A into the National
Health Act 1953.This will allow the Minister to determine a
list of pharmaceuticals which may, after prescription by a medical
practitioner, be supplied in bulk to private hospitals and
residential care services (i.e. hostels and nursing homes) and for
which the supplier will be reimbursed.
Payment in respect of that supply will be made by the
Commonwealth in accordance with a scheme to be prescribed.
Items 5 to 9 and
12 to 14 repeal the arrangements
dealing with the amalgamation and closure of pharmacies which took
place as a part of the restructure ofpharmacies in the early
1990's.Any claims for financial assistance had to be made by 28
February 1995 and the Explanatory Memorandum states that all
applications for those grants have been finalised.
- Health and Family Services Portfolio, Portfolio Budget
Statements 1997 98: 124.
- Agreement between the Commonwealth of Australia and the
State of New South Wales in relation to the provision of Public
Hospital Services and Other Health Services: 14
- Health Insurance Commission, Annual Report 1996 97:
49.
Lee Jones (Main Provisions)
Paul Mackey(Background)
25 November 1997
Bills Digest Service
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ISSN 1328-8091
© Commonwealth of Australia 1997
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Last updated: 26 November 1997
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