Commonwealth Numbered Regulations - Explanatory Statements

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PRIVATE HEALTH INSURANCE COMPLAINTS LEVY REGULATIONS 1995 NO. 264

STATUTORY RULES 1995 No. 264

Issued by Authority of the Minister for Human Services and Health

Private Health Insurance Complaints Levy Act 1995

Private Health Insurance Complaints Levy Regulations

Section 9 of the Private Health Insurance Complaints Levy Act 1995 (the Act) provides that the Governor-General may make regulations, prescribing matters required or permitted to be prescribed under the Act.

Under sections 5 and 7 of the Act and section 82ZVC of the Health Legislation (Private Health Insurance Reform) Amendment Act 1993 (the Reform Act), a levy which is a debt due to the Commonwealth is to be imposed on registered organisations conducting health insurance businesses (health benefits funds).

The levy is to meet the costs of the operation of the Private Health Insurance Complaints Commissioner (the Commissioner) , which is to be established from 1 October 1995 under the Reform Act. The role of the Commissioner will be to provide an independent investigative and conciliatory service to resolve complaints which arise in regard to private health insurance arrangements.

Subsection 6(1) of the Act provides for the rate of levy to be prescribed by the Regulations.

Subsection 6(2) of the Act provides for the rate of levy to be based on the number of contributors who contribute to a health benefits fund.

Subsection 6 (3) of the Act provides that the Regulations may prescribe different rates of levy in respect of contributors who contribute to a health benefits fund in respect of one person, and the contributors who contribute to a health benefits fund in respect of more than one person.

Subsection 6(4) of the Act prescribes that the rate of levy must not exceed 25 cents per quarter per contributor who contributes to a health benefits fund in respect of one person, and 50 cents per quarter per contributor who contributes to a health benefits fund in respect of more than one person.

The regulations;

(a)       prescribe rates of levy calculated in accordance with the given formulae to raise $705,000 from health benefits funds for the period of 1 October 1995 to 30 June 1996, to meet the expected costs of the establishment and operation of the Private Health Insurance Complaints Commissioner. Based on the preliminary data available as at 30 June .1995 on the number of contributors to health benefits funds, the levy rate payable by a registered organization for a quarter in respect of a contributor contributing at (i) 'Single Rate' will be 4.38 cents and (ii) 'Family Rate' will be 8.76 cents.

(b)       prescribe rates of levy calculated in accordance with the given formulae to raise $700,000 from health benefits funds for each financial year after 30 June 1996 to meet the expected costs of operation of the Private Health Insurance Complaints Commissioner. Based on the preliminary data available as at 30 June 1995 on the number of contributors to health benefits funds, the levy rate payable by a registered organization for a quarter in respect of a contributor contributing at (i) 'Single Rate' will be 3.26 cents and (ii)'Family Rate' will be 6.53 cents.

Section 8 of the Act provides for the Regulations to prescribe the days on which the levy is due and payable.

Further details of the Regulations are set out in the Attachment.

The Regulations will commence on 1 October 1995.

ATTACHMENT

DETAILS OF THE PRIVATE HEALTH INSURANCE COMPLAINTS LEVY REGULATIONS

Regulation 1 states that the Regulations may be cited as the Private Health Insurance Complaints Levy Regulations.

Regulation 2 provides for these Regulations to commence on 1 October 1995.

Regulation 3 provides for the interpretation of the terms "new fund", "organization's fund", "Quarter", "transferring fund" and "the Act" in the Regulations.

Subregulations 4(1) to 4(3) prescribe the rate of levy payable by a registered organization for the period commencing on, 1 October 1995 and ending at the end of 30 June 1996. The levy rate is calculated in accordance with the prescribed formulae and is based on the number of contributors to health benefits funds. The levy rate is set to raise $705,000 from health benefits funds for the period of 1 October 1995 to 30 June 1996, to meet the expected costs of the establishment and operation of the Private Health Insurance Complaints Commissioner.

Based on the preliminary data provided by the Private Health Insurance Administration Council (PHIAC) regarding the number of contributors as at 30 June 1995, the levy rate payable by a registered organization is;

(a)       4.38 cents per quarter in respect of a contributor contributing at 'Single Rate'; and

(b)       8.76 cents per quarter in respect of a contributor contributing at 'Family Rate'.

Subregulation 4(4) specifies that the levy for the period commencing on 1 October 1995 and ending at the end of 30 June 1996 is payable on 17 March 1996.

Subregulations 5(1) to 5(3) prescribe the rate of levy payable by a registered organization after 30 June 1996. The levy rate is calculated in accordance with the prescribed formulae and is based on the number of contributors to health benefits funds. The levy rate is set to raise $700,000 from health benefits funds for each financial year after 30 June 1996 to meet the expected costs of the operation of the Private Health Insurance Complaints Commissioner.

The levy rate for financial year 1996/97 and thereafter will depend on the number of contributors defined in Regulation 6.

If the preliminary data provided by the Private Health Insurance Administration Council (PHIAC) regarding the number of contributors as at 30 June 1995 is used for illustration purposes, then the levy rate payable by a registered organization after 30 June 1996 would be;

(a)       3.26 cents per quarter in respect of a contributor contributing at 'Single Rate'; and

(b)       6.53 cents per quarter in respect of a contributor contributing at 'Family Rate'.

Subregulation 5(4) specifies the levy payable dates after 30 June 1996 as;

(a)       17 March of each year, for a quarter commencing on 1 January or 1 April in that calendar year; and

(b)       16 September of each year, for a quarter commencing on 1 July or 1 October in that calendar year.

Subregulations 6(1) to 6(4) define a contributor to an organization's fund.