Richard Colbeck (Tasmania, Liberal Party, Parliamentary Secretary to the Minister for Agriculture) Share this | Hansard source

I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

PRIVATE HEALTH INSURANCE AMENDMENT BILL (NO. 2) 2014

The Private Health Insurance Amendment Bill (No. 2) 2014 implements a part of the 2014-15 budget measure "Smaller Government—additional reductions in the number of Australian Government bodies" by transferring the functions of the Private Health Insurance Ombudsman to the Office of the Commonwealth Ombudsman from 1 July 2015. The consolidation of these functions will reduce duplication, improve coordination and increase efficiency in delivering the Ombudsman's services to the community.

It is important to note that there is expected to be no impact upon the services provided to policy holders. The Private Health Insurance Ombudsman will continue to provide education and advice services to consumers as well as assist in resolving private health insurance complaints. The Private Health Insurance Ombudsman will also keep its consumer website which will continue to be managed by Private Health Insurance Ombudsman staff transferring to the Office of the Commonwealth Ombudsman.

The transfer of the Private Health Insurance Ombudsman to the Office of the Commonwealth Ombudsman will result in direct savings to industry. As the Private Health Insurance Ombudsman operates on a cost recovered basis, all savings made will be directly reflected in reduced levies payable by the private health insurance industry.

As part of the transfer of functions, the opportunity has been taken to streamline some of the investigative procedures of the Private Health Insurance Ombudsman with those of the Commonwealth Ombudsman. This deregulation of the Private Health Insurance Ombudsman will lessen the administrative burden placed upon the Commonwealth Ombudsman by aligning complaints handling and investigation processes between the agencies. These administrative efficiencies are expected to enhance the flexibility and responsiveness of complaints handling, and ensure that consumer complaints are resolved expediently and satisfactorily, helping patients get the best value from their insurance.

Further, under the Private Health Insurance Act 2007, the only statutory process available to the Private Health Insurance Ombudsman to gather information was to make a formal written request for information or records to the subject of a complaint. However, consistent with information gathering powers in the Ombudsman Act 1976, the Private Health Insurance Ombudsman will now be able to either request information and documents from a person, or formally require the production of information or records by written notice. This will allow for a more graduated information gathering approach, which will in turn provide for increased consumer protection and an expedited complaints resolution process.

Finally, this Bill will make a minor amendment to the Private Health Insurance Act 2007 to remove references to the "Base Premium" which were intended to be removed by the Private Health Insurance Legislation Amendment Act 2014 passed by the parliament earlier this year. Unfortunately, due to an unintended delay in the granting of Royal Assent these references were not removed.

The removal of remaining references to the concept of a base premium will not affect how the current premiums reduction scheme is applied for insurers and relevant policy holders and the simplified calculation of the Australian Government Rebate on private health insurance will remain in place.

This Government has long acknowledged the important role that private health insurance plays throughout the Australian healthcare system, and is committed to supporting Private Health Insurance now and into the future.