Explanatory Memorandum(Circulated by authority of the Minister for Health and Ageing, the Honourable Tony Abbott MP)
PRIVATE HEALTH INSURANCE (REINSURANCE TRUST FUND LEVY) AMENDMENT BILL 2006
Clause 1 Short title
This clause sets out the short title of the Bill.
Clause 2 Commencement
This clause sets out the commencement day for the various provisions in the Bill.
Clause 3 Schedule(s )
This clause provides that each Act specified in a Schedule to the Bill is amended or repealed as set out in the Schedule, and any other item in a Schedule has effect according to its terms. Schedule 1 - Amendments Private Health Insurance (Reinsurance Trust Fund Levy) Act 2003
Item 1 amends the title of the Act following the change in name from the Reinsurance Trust Fund to the Risk Equalisation Trust Fund under Part 6-7 of the proposed Private Health Insurance Act, and other changes to terminology in that Act.
Item 2 amends section 1 to reflect the change in name of the Reinsurance Trust Fund to the risk equalisation fund.
Item 3 replaces the reference in section 5 to the National Health Act in the definition of Council in section 5 with a reference to the proposed Private Health Insurance Act.
Item 4 repeals the definition of the National Health Act in section 5, as this is now redundant.
Item 5 amends section 5 to insert a definition of private health insurer as defined in the proposed Private Health Insurance Act.
Item 6 amends the definition of registered health benefits organization to reflect the proposed repeal of the National Health Act 1953.
Items 7 to 9 repeal the definitions of Reinsurance Trust Fund, Reinsurance Trust Fund levy and Reinsurance Trust Fund levy day in section 5, as these are now redundant.
Item 10 amends section 5 to include a definition of risk equalisation levy as a levy imposed under section 6.
Item 11 amends section 5 to include a definition of risk equalisation levy day as a day specified in the Private Health Insurance (Risk Equalisation Levy) Rules made under section 6.
Item 12 amends section 5 to include a definition of Risk Equalisation Trust Fund as the Private Health Insurance Risk Equalisation Trust Fund continued in existence under section Part 6-7 of the proposed Private Health Insurance Act.
Items 13 and 14 amend section 5 to replace the definition of a supplementary Reinsurance Trust Fund levy day with a definition of a supplementary risk equalisation levy day as a day specified by the Minister under section 6.
Item 15 repeals section 6, and replaces it with a new section, which imposes risk equalisation levy on each private health insurer on each day specified in the Private Health Insurance (Risk Equalisation Levy) Rules as a risk equalisation levy day, and on each day determined by the Minister as a supplementary risk equalisation levy day. There can be a maximum of four risk equalisation levy days and two supplementary risk equalisation levy days in a financial year.
Item 16 amends subsection 7(1) to replace the reference to the rate of Reinsurance Trust Fund levy with a reference to the rate of risk equalisation levy.
Item 17 repeals the table in subsection 7(1) and replaces it with a new table with references to the risk equalisation levy day and supplementary risk equalisation levy day (rather than Reinsurance Trust Fund levy day and Reinsurance Trust Fund supplementary levy day) and references to rates determined by the Council and the Minister by legislative instrument (rather than in writing).
Item 18 amends subsection 7(2) to require the Council and the Minister in setting the levy rate to comply with Private Health Insurance (Risk Equalisation Policy) Rules made under the proposed Private Health Insurance Act rather than follow principles determined under subsection 73BC(5B) of the National Health Act 1953 .
Item 19 amends section 8 to omit all references to Reinsurance Trust Fund and substitute references to risk equalisation.
Item 20 adds a new section 10A empowering the Minister to make Private Health Insurance (Risk Equalisation Levy) Rules for the purpose of the Act.
Item 21 is a transitional provision which provides that the total number of days on which levy is imposed under the Act for the financial year ending on 30 June 2007 must not exceed six.
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