HEALTH CARE (APPROPRIATION) AMENDMENT BILL 2003 Explanatory Memorandum

HEALTH CARE (APPROPRIATION) AMENDMENT BILL 2003

2002-2003





THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA





HOUSE OF REPRESENTATIVES

HEALTH CARE (APPROPRIATION) AMENDMENT BILL 2003

EXPLANATORY MEMORANDUM







(Circulated by authority of the Minister for Health and Ageing,

Senator the Hon Kay Patterson)



HEALTH CARE (APPROPRIATION) AMENDMENT BILL 2003

OUTLINE



This Bill proposes amendments to the Health Care (Appropriation) Act 1998.



These amendments extend the period of operation of the Act for a second five year period commencing on 1 July 2003. This will enable the Commonwealth to enter into new Australian Health Care Agreements and maintain funding to the States pending settlement of Agreements.



The Bill provides the legislative basis for grants of financial assistance for the provision of hospital services provided, or projects or programs conducted during the 5 years starting on 1 July 2003. This includes grants under paragraph 4(1)(b) of the Act, such as Commonwealth Own Purpose Outlays for mental health, palliative care and Hospital Information and Performance Information Program (formerly casemix development) and the Pathways Home program.



The amendments will:



• extend the period of operation of the above Act for a second 5 year period commencing on 1 July 2003;



• refine the definition of “eligible person” to reflect the current definition in the Health Insurance Act 1973;



• appropriate from the Consolidated Reserve Fund an amount not exceeding $42,010,000,000 for hospital services provided, and projects and programs conducted during the period of 5 years commencing on 1 July 2003;



• grant the Minister for Health and Ageing, in new section 7, the power to delegate to an SES employee in the department, any of the Minister’s powers under paragraph 4(1)(b), and subsections 5(1), 5(2) and 5(3) of the Act, in so far as they relate to financial assistance granted under paragraph 4(1)(b); and



• amend subsection 5(2) to provide for conditions (in addition to the condition in section 6) to apply to grants of financial assistance under section 4 to a State in respect of a particular appropriation period.



In order to extend the period of operation of the Act for a second five year period, in section 3 a definition of “appropriation period” is inserted which specifies ‘the period of 5 years starting on 1 July 2003’. Minor amendments to subsections 4(2), 4(5) and 5(2) make provision for the appropriation period beginning on 1 July 2003.



It was considered important that definitions used are consistent with definitions used elsewhere in the health system, as a consequence, the definition of “eligible person” has been amended to reflect the current definition in the Health Insurance Act 1975.



Subsection 4(3) is amended to allow for the 5 year appropriation period commencing on 1 July 2003 and to limit the total amount paid by way of grants of financial assistance under this section up to 30 June 2008 to $42,010,000,000.



The power of delegation in the new section 7 would only cover grants of financial assistance to a State, hospital or other person for the purposes specified in paragraph 4(1)(b) of the Act. The Minister is not granted the power to delegate her/his powers in relation to grants to the States under paragraph 4(1)(a) for the provision of hospital services under the Australian Health Care Agreements. Delegates would be subject to the directions of the Minister.



Over the 5 years commencing on 1 July 2003, subsection 4(1)(b) grants are estimated to be $359.8 million or 0.9% of total payments under the Act, covering grants to States under the Pathways Home Program ($253 million over 5 years) and grants to States, hospitals or individuals on national projects (Commonwealth Own Purpose Outlays) relating to mental health, palliative care and Hospital Information and Performance Information Program (formerly casemix development).







FINANCIAL IMPACT STATEMENT



The amendments will allow grants of financial assistance to be paid in accordance with section 4 of the Act.

HEALTH CARE (APPROPRIATION) AMENDMENT BILL 2003

NOTES ON CLAUSES



Clause 1 - Short title



Specifies the short title of the Act as the Health Care (Appropriation) Amendment Act 2003.



Clause 2 - Commencement



Provides that the Act commences on the day on which it receives Royal Assent.



Clause 3 - Schedule



Ensures that the amendments, repeals and items in the Schedule can take effect.

SCHEDULE 1

The Bill comprises only one Schedule that amends the Health Care (Appropriation) Act 1998.



Item 1



Amends the title by omitting “for the period of 5 years starting on 1 July 1998”.



Item 2



Inserts a definition of appropriation period in section 3 to allow for two appropriation periods, one for the period of 5 years starting on 1 July 2003 (already covered by the Act) and the other for the period of 5 years starting on 1 July 2003.



Item 3



Repeals the definition of “eligible person” and substitutes a definition of “eligible person” to reflect the current definition on the Health Insurance Act 1973.



Item 4



Omits all the words after “during” in subsection 4(2) and substitutes an “appropriation period” to reflect the two appropriation periods.



Item 5



Amends subsection 4(3) by omitting “exceed $31,800,000,000” and substituting

exceed:

(a) in respect of the appropriation period starting on 1 July 1998 - $31,800,000,000; or

(b) in respect of the appropriation period starting on 1 July 2003 - $42,010,000,000.



This provides for an appropriation not exceeding $42,010,000,000 for the period of 5 years starting on 1 July 2003.



Item 6 and Item 7



Amend subsection 4(5) by:

(a) omitting “30 June 2003” and substituting “the end of an appropriation period”; and

(b) adding at the end of the subsection “in respect of the appropriation period”.

This provides for a second statement to each House of Parliament in respect of the period of 5 years starting on 1 July 2003

Item 8

Repeals subsection 5(2) and substitutes a new subsection which provides that, in relation to a particular appropriation period, a grant of financial assistance under section 4 to a State is (in addition to the condition specified in section 6) subject to:

(a) the conditions applicable to the grant that are specified in an agreement in force between the Commonwealth and the State for that appropriation period; or

(b) if there is no agreement in force specifying the conditions applicable to the grant, conditions determined by the Minister.



This adjusts subsection 5(2) to provide for conditions (in addition to the condition in section 6) to apply to grants of financial assistance under section 4 to a State in respect of a particular appropriation period.



Item 9



Inserts a new section 7 which grants the Minister for Health and Ageing the power to delegate to an SES employee in the Department the power to decide to grant of financial assistance under subsection 4(1)(b) and in relation to that grant:

(a) to decide the amount of the grant, the method of payment of the grant and the time or time for payment of the grant or instalments of the grant (subsection 5(1)); and

(b) the power to decide the conditions of the grant (subsection 5(2) in relation to a State, and otherwise, subsection 5(3) of the Act).