PRIVATE HEALTH INSURANCE (PRUDENTIAL SUPERVISION) ACT 2015 (NO. 85, 2015)

Contents

Part 1--Introduction 2

Division 1--Preliminary 2

1............ Short title............................................................................................. 2

2............ Commencement................................................................................... 2

3............ Simplified outline of this Act.............................................................. 3

4............ Interpretation....................................................................................... 3

5............ General administration of Act........................................................... 10

Division 2--Constitutional matters 11

6............ Act binds the Crown......................................................................... 11

7............ Act not to apply to State insurance within that State.......................... 11

8............ Compensation for acquisition of property......................................... 11

Part 2--Registration of private health insurers 12

Division 1--Introduction 12

9............ Simplified outline of this Part............................................................ 12

Division 2--Prohibition of carrying on health insurance business without registration 13

10.......... Carrying on health insurance business without registration.............. 13

11.......... Injunctions........................................................................................ 13

Division 3--Registration 15

12.......... Applying for registration................................................................... 15

13.......... Requiring further information........................................................... 15

14.......... Criteria for registration...................................................................... 15

15.......... Deciding the application.................................................................... 15

16.......... Notifying the decision....................................................................... 17

17.......... APRA can be taken to refuse application.......................................... 17

18.......... APRA to ensure that up-to-date record of information about private health insurers is publicly available 18

19.......... Changing registration status.............................................................. 18

20.......... Conversion to for profit status.......................................................... 20

21.......... Cancellation of registration................................................................ 21

Part 3--Health benefits funds 22

Division 1--Introduction 22

22.......... Simplified outline of this Part............................................................ 22

Division 2--The requirement to have health benefits funds 23

23.......... Private health insurers must have health benefits funds.................... 23

24.......... Notifying APRA when health benefits funds are established........... 24

25.......... Inclusion of health-related businesses in health benefits funds......... 24

Division 3--The operation of health benefits funds 26

26.......... Assets of health benefits funds......................................................... 26

27.......... Payments to health benefits funds..................................................... 27

28.......... Expenditure and application of health benefits funds........................ 28

29.......... Effect of non-compliance with section 28......................................... 29

30.......... Investment of health benefits funds................................................... 31

Division 4--Restructure, merger and acquisition of health benefits funds 32

31.......... Restriction on restructure, merger or acquisition of health benefits funds 32

32.......... Restructure of health benefits funds.................................................. 32

33.......... Merger and acquisition of health benefits funds................................ 34

34.......... Consent of policy holders not required............................................. 37

Division 5--Termination of health benefits funds 38

Subdivision A--Approving the termination of health benefits funds 38

35.......... Applying for termination................................................................... 38

36.......... Requiring further information........................................................... 38

37.......... Deciding the application.................................................................... 38

38.......... APRA can be taken to have refused to approve termination............. 39

Subdivision B--Conducting the termination of health benefits funds 39

39.......... The basis of the law relating to termination....................................... 39

40.......... Conduct of funds during termination process................................... 40

41.......... Insurers etc. to give reports to APRA............................................... 41

42.......... Terminating managers displace management of funds...................... 41

Subdivision C--Ending the termination of health benefits funds 41

43.......... Power to end termination.................................................................. 41

Subdivision D--Completing the termination of health benefits funds 42

44.......... Completion of the termination process.............................................. 42

45.......... Distribution of remaining assets after completion of the termination process 42

46.......... Liability of officers of insurers for loss to terminated funds............. 43

47.......... Reporting by terminating manager.................................................... 43

48.......... Applying for winding up.................................................................. 44

Division 6--External management of health benefits funds 45

Subdivision A--Preliminary 45

49.......... Purpose of Division.......................................................................... 45

50.......... The basis of the law relating to external management........................ 45

Subdivision B--Appointment of external managers 46

51.......... APRA may appoint external managers............................................. 46

52.......... Preconditions for appointment of external managers......................... 47

53.......... External managers to displace management of funds........................ 47

Subdivision C--Duties and powers of external managers 47

54.......... Duties of external managers.............................................................. 47

55.......... Additional powers of external managers........................................... 48

56.......... Protection of property during external management.......................... 48

57.......... Rights of chargee, owner or lessor of property of fund under external management 49

Subdivision D--Procedure relating to voluntary deeds of arrangement 49

58.......... Matters that may be included in APRA rules.................................... 49

Subdivision E--External managers' reports to APRA 50

59.......... External managers to give reports to APRA..................................... 50

60.......... Dealing with reports given to APRA................................................ 52

61.......... Federal Court orders in respect of schemes of arrangement.............. 53

Subdivision F--Miscellaneous 54

62.......... When an external management begins and ends................................ 54

63.......... Effect of things done during external management of health benefits funds 54

64.......... Disclaimer of onerous property......................................................... 54

65.......... Application of provisions of Corporations Act................................. 55

Division 7--Ordering the termination of health benefits funds 57

66.......... Applications by external managers to the Federal Court................... 57

67.......... Orders made on applications for appointments of terminating managers 57

68.......... Notice of appointments..................................................................... 57

69.......... Application of other provisions if Federal Court orders appointment of a terminating manager 57

Division 8--External managers and terminating managers 59

Subdivision A--Powers of managers 59

70.......... Powers of managers.......................................................................... 59

71.......... Officers etc. not to perform functions etc. while fund is under management 60

72.......... Managers act as agents of private health insurers.............................. 60

Subdivision B--Information concerning, and records and property of, health benefits funds 61

73.......... Directors etc. to help managers......................................................... 61

74.......... Managers' rights to certain records................................................... 62

75.......... Only manager can deal with property of fund under management.... 63

76.......... Order for compensation where officer involved in void transaction.. 64

Subdivision C--Provisions incidental to appointment of managers 65

77.......... Remuneration and allowances of managers....................................... 65

78.......... Directions to managers...................................................................... 65

79.......... Termination of appointments of managers........................................ 66

80.......... Acts of managers valid etc................................................................ 67

81.......... Indemnity.......................................................................................... 68

82.......... Qualified privilege............................................................................. 68

Subdivision D--Miscellaneous 68

83.......... Time for doing act does not run while act prevented by this Division or other provisions 68

84.......... Continued application of other provisions of Act.............................. 69

85.......... Modifications of this Act in relation to health benefits funds under management 69

86.......... Order of Federal Court to be binding on all persons......................... 70

87.......... APRA rules dealing with various matters......................................... 70

Division 9--Duties and liabilities of directors etc. 71

88.......... Notices to remedy contraventions..................................................... 71

89.......... Liability of directors in relation to non-compliance with notices....... 71

90.......... APRA may sue in the name of private health insurers...................... 72

Part 4--Prudential standards and directions 73

Division 1--Introduction 73

91.......... Simplified outline of this Part............................................................ 73

Division 2--Prudential standards 74

92.......... Prudential standards.......................................................................... 74

93.......... Additional matters in relation to standards that are not legislative instruments 76

94.......... Compliance with prudential standards............................................... 76

95.......... Notice of contravention of prudential standards or of other matters that materially affect financial position 77

Division 3--Directions 78

96.......... APRA's power to give directions..................................................... 78

97.......... The kinds of direction that may be given........................................... 79

98.......... Power to comply with a direction...................................................... 81

99.......... Varying or revoking a direction........................................................ 81

100........ When a direction ceases to have effect.............................................. 81

101........ Direction not grounds for denial of obligations................................. 81

102........ Supply of information about directions............................................. 82

103........ Secrecy requirements........................................................................ 83

104........ Non-compliance with a direction....................................................... 84

Part 5--Other obligations of private health insurers 86

Division 1--Introduction 86

105........ Simplified outline of this Part............................................................ 86

Division 2--Appointed actuaries 87

106........ Appointment..................................................................................... 87

107........ Terminating an appointment as actuary............................................. 87

108........ Notification of appointment etc......................................................... 88

109........ Role of appointed actuary.................................................................. 89

110........ Actuary's obligations to inform of matters etc.................................. 89

111........ Appointed actuary may give information or documents to APRA.... 91

112........ Duty of appointed actuary to give information or documents when required 92

113........ Qualified privilege of appointed actuary............................................ 93

114........ Referring matters to professional associations for actuaries.............. 94

115........ APRA may direct removal of actuary............................................... 94

Division 3--Disqualified persons 97

116........ Private health insurers not to allow disqualified persons to act as officers or appointed actuaries 97

117........ Disqualified persons must not act for private health insurers............ 97

118........ Effect of non-compliance.................................................................. 98

119........ Who is a disqualified person?........................................................... 98

120........ Court power of disqualification......................................................... 99

121........ Court power to revoke or vary a disqualification etc....................... 100

122........ Privilege against exposure to penalty--disqualification under section 120 101

Division 4--Miscellaneous 103

123........ Restrictions on payment of pecuniary penalties etc......................... 103

124........ Giving APRA copies of reports made to policy holders................. 103

125........ Notifying APRA of name and contact details of officers................ 103

Part 6--Monitoring and investigation 104

Division 1--Introduction 104

126........ Simplified outline of this Part.......................................................... 104

Division 2--Monitoring 105

127........ Purposes for which powers may be exercised etc........................... 105

128........ Power to require private health insurer to provide information and reports 105

129........ Power to require production of documents..................................... 105

Division 3--Investigation 107

130........ Investigation of private health insurers by inspectors...................... 107

131........ Identity cards for inspectors............................................................ 107

132........ Powers of inspectors....................................................................... 108

133........ Person may be represented by lawyer when being examined.......... 109

134........ Access to premises.......................................................................... 109

135........ General provisions relating to obtaining consent to enter premises. 110

136........ Investigation warrants..................................................................... 111

137........ Announcement before entry under investigation warrant................ 112

138........ Inspector to be in possession of investigation warrant.................... 112

139........ Details of warrant etc. to be given to occupier................................. 112

140........ Right to observe execution of warrant............................................. 113

141........ Responsibility to provide facilities and assistance........................... 113

142........ Concealing etc. documents.............................................................. 114

143........ Reports of inspectors...................................................................... 114

144........ Dissemination of reports................................................................. 115

145........ Liability for publishing reports etc.................................................. 115

146........ Powers of magistrates..................................................................... 116

147........ Delegation by inspectors................................................................. 116

Division 4--Other matters 117

148........ Refusing or failing to comply with requirements............................ 117

149........ Self-incrimination............................................................................ 117

150........ Protection from liability................................................................... 118

Part 7--Enforceable undertakings 119

151........ Simplified outline of this Part.......................................................... 119

152........ Enforceable undertakings................................................................ 119

Part 8--Remedies in the Federal Court 121

153........ Simplified outline of this Part.......................................................... 121

154........ APRA may apply to the Federal Court........................................... 121

155........ Declarations of contravention.......................................................... 121

156........ Civil penalty order........................................................................... 122

157........ Compensation order........................................................................ 122

158........ Other order...................................................................................... 123

159........ Civil evidence and procedure rules for declarations and orders....... 123

160........ Civil proceedings after criminal proceedings................................... 123

161........ Criminal proceedings during civil proceedings............................... 123

162........ Criminal proceedings after civil proceedings................................... 124

163........ Evidence given in proceedings for penalty not admissible in criminal proceedings 124

164........ APRA may require person to assist................................................ 124

Part 9--Miscellaneous 126

165........ Simplified outline of this Part.......................................................... 126

166........ Relief from liability......................................................................... 126

167........ Annual publication of information relating to health benefits funds 127

168........ Review of decisions........................................................................ 127

169........ Statements to accompany notification of decisions.......................... 130

170........ Approvals, determinations etc. by APRA....................................... 131

171........ Powers of Federal Court................................................................. 131

172........ Approved forms, and giving documents not required to be in approved forms 131

173........ Delegation by Minister.................................................................... 132

174........ APRA rules.................................................................................... 132

Commonwealth Numbered Acts

PRIVATE HEALTH INSURANCE (PRUDENTIAL SUPERVISION) ACT 2015 (NO. 85, 2015) - NOTES