BILLS DIGEST NO. 48, 2012–13

22 November 2012

Health and Other Legislation Amendment Bill 2012

Leah Ferris
Law and Bills Digest Section

Date introduced:  19 September 2012

House:  House of Representatives

Portfolio:  Health and Ageing

Commencement:  Sections 1 to 3 commence on Royal Assent. Items 1 to 17 and items 20 to 23 of Schedule 1 commence the day after Royal Assent. Items 18 and 19 commence on a day to be fixed by Proclamation or the day after the end of a six month period after the date of Royal Assent, whichever is earliest.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill's home page, or through http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation. When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website at http://www.comlaw.gov.au/.

Purpose

The purpose of the Health and Other Legislation Amendment Bill 2012 (the Bill) is to amend the:

•       Food Standards Australia New Zealand Act 1991 (Food Standards Act)[1] to correct referencing inconsistencies

•       Health Insurance Act 1973 (Health Insurance Act)[2] to introduce into primary legislation provisions that allow supervising specialists to receive the Medicare benefit for procedures performed by trainee medical specialists under the supervision of the specialist

•       Industrial Chemicals (Notification and Assessment) Act 1989 (Industrial Chemicals Act)[3] to allow for chemicals undergoing transhipment to be stored by Customs outside the receiving port or airport and

•       Human Services (Medicare) Act 1973 (Human Services (Medicare) Act)[4] to allow the Secretary of the Department of Human Services to authorise the use of the term ‘medicare’.[5]

Structure of this Digest

Due to the nature of the amendments proposed in the Bill, there is no general background or main issues. Instead, the proposed amendments have been addressed in accordance with the Act they are amending.

Committee consideration

Selection of Bills

At its meeting on the 10 October 2012, the Senate Selection of Bills Committee determined that the Bill not be referred to any committee for inquiry and report.[6]

Scrutiny of Bills

The Senate Standing Committee for the Scrutiny of Bills had no comment to make in regards to this Bill.[7]

Joint Committee on Human Rights

In its fifth report of 2012, the Parliamentary Joint Committee on Human Rights (the Joint Committee on Human Rights) examined all Bills introduced in the 17–20 September 2012 period, which included this Bill.[8]

In determining whether the Bill sufficiently complied with the Human Rights (Parliamentary Scrutiny) Act 2011, the Joint Committee on Human Rights stated:

The Committee has no substantive comments in relation to this bill as it does not appear to raise any human rights concerns and the statement of compatibility is adequate.[9]

Financial implications

According to the Explanatory Memorandum, the proposed amendments will have no financial impact.[10]

Main issues and key provisions

Food Standards Act

The Food Standards Act established Food Standards Australia New Zealand (FSANZ), which is the agency responsible for developing standards to cover the food industry in Australia and New Zealand.[11]

Items 1 to 17 of the Bill amend the Food Standards Act to correct a number of referencing errors.

In particular, items 1-2, 7-8, 11 and 14-17 of the Bill remove any reference to charges being ‘fixed’ under section 146 of the Food Standards Act.[12] Subsection 146(1) actually provides that charges may be fixed under the regulations, whereas section 153 gives the Governor-General the power to make regulations that are not inconsistent with the provisions of the Food Standards Act. Accordingly, charges are not ‘fixed’ under section 146 – they are fixed in regulations made under section 153, relying on section 146. In removing the word ‘fixed’, reference will now be made to ‘charges under section 146’.

Items 3-6, 9-10 and 12-13 of the Bill remove any reference to charges being ‘fixed under subparagraph 146(6)(b)(i) or 146(6)(b)(ii)’. This is to reflect amendments made to the Food Standards Act in 2010, which repealed subparagraphs 146(6)(b)(i) and 146(6)(b)(ii).[13]

Health Insurance Act

In Australia, the Medicare Program (Medicare) provides universal access to medical and hospital services for all permanent residents.[14] Some of the major elements of Medicare are contained within the Health Insurance Act, specifically the provision of Medicare benefits.

The amendments to the Health Insurance Act contained in this Bill will recognise, in primary legislation, arrangements already contained in regulations, which provide that the Medicare rebate for a service provided by a specialist medical trainee under the supervision of a medical specialist is payable to the supervising medical specialist, rather than the trainee.

As stated by the Health Minister, Tanya Plibersek:

Prior to 1 July 2011, only trainee surgeons- with the Royal Australasian College of Surgeons- could conduct a procedure under the direct supervision of a specialist in a private setting and have that service attract a Medicare rebate for the supervising surgeon. The procedure was considered to have been performed by the supervising surgeon who retained the right to any bulk-billed Medicare benefit in relation to the procedure. This arrangement meant that trainee surgeons had greater access to clinical training opportunities.[15]

On 1 July 2011 this policy was changed to apply this arrangement to trainees of other approved medical colleges, not just surgeons, to allow them to also take advantage of this opportunity in clinical training. This change occurred under the Health Insurance (General Medical Services Table) Regulations 2011 (the Health Insurance Regulations 2011), which were made under the Health Insurance Act.[16] The Health Insurance Regulations 2011 have since been repealed and replaced by the Health Insurance (General Medical Services Table) Regulation 2012 (Health Insurance Regulation 2012). Even though this policy has already been operating under both the Health Insurance Regulations 2011 and the Health Insurance Regulation 2012, the Government considers that it is more appropriate that it be inserted into the Health Insurance Act.

In explaining the need for this policy to be included in the Act, Minister Plibersek stated:

This further expands the country’s training capacity for specialists with no additional costs to Government. The change has been a successful one, and is expected to continue to help alleviate some of the training capacity issues for trainee specialists which are being faced by health systems. The Government considers that it is appropriate that the policy should be recognised at the level of primary legislation.[17]

Item 18 of the Bill inserts subsections 3(18)-(20) into the Health Insurance Act. Proposed subsection 3(18) of the Health Insurance Act provides that where a professional service prescribed by the regulations is performed by a specialist trainee under the direct supervision of a medical practitioner, then the service will be taken to have been performed by the medical practitioner.[18] Under the Health Insurance Regulation 2012, the following professional services have been prescribed:

•       radiation oncology, therapeutic nuclear medicine and miscellaneous therapeutic procedures

•       regional or field nerve blocks

•       anaesthesia and surgical services and

•       a limited range of obstetric services.[19]

It is unclear whether there will be any change to these professional services under amended regulations made subsequent to the passage of this Bill.

Proposed subsection 3(19) of the Health Insurance Act provides that regulations may prescribe provisions of the Health Insurance Act and of the regulations to which proposed subsection 3(18) does not apply.

According to the Explanatory Memorandum:

There is currently no intention to make regulations under subsection 3(19), but it has been included to give the Government the flexibility in the future to prevent the application of the specialist trainee measure in respect of certain legislative provisions. This would mean that the specialist trainee would be taken to have rendered the service provided under supervision for those provisions [as opposed to the supervising medical practitioner].[20]

Proposed subsection 3(20) of the Health Insurance Act provides that the term ‘specialist trainee’ has the same meaning given by the regulations made for the purposes of that subsection. A definition of ‘specialist trainee under the supervision of a medical practitioner’ is currently provided under the Health Insurance Regulation 2012.[21]

Industrial Chemicals Act

The Industrial Chemicals Act established the National Industrial Chemicals Notification and Assessment Scheme (NICNAS), which is responsible for regulating the use of industrial chemicals in Australia.[22]

The amendments proposed in the Bill relate to the transhipment of industrial chemicals. Transhipment means to ‘transfer (cargo) from one ship or another form of transport to another’.[23] In this case, it means where a new industrial chemical has been shipped to Australia, and then shipped on to another destination. Under paragraph 21(6)(b)(ii) of the Industrial Chemicals Act, chemicals that have been transhipped to Australia are excluded from the assessment requirements set out under section 21, provided they:

•       are introduced by a person at a port or airport in Australia

•       are at all times subject to the control of the Customs and Border Protection Service (Customs) at the port or airport before leaving Australia and

•       leave Australia less than 30 days after the day of introduction.[24]

Item 23 of the Bill amends subparagraph 21(6)(b)(ii) to remove the words ‘at the port or airport’. The purpose of this amendment is to change the legislation to reflect the practical reality, whereby goods are stored outside a port or airport (often in a customs-bonded section of a nearby warehouse), but are still within the control of Customs.[25]

As stated in the Explanatory Memorandum:

Under these conditions, the chemical still fulfils the intent of the exemption provision in this section of the Act, namely that the chemical under these tightly controlled conditions provides a minimal risk to the Australian public and environment before being transhipped out of Australia, and therefore should not require notification and assessment.[26]

Human Services (Medicare) Act

The Human Services (Medicare) Act sets out some of the administrative arrangements in regards to Medicare. The amendments to the Human Services (Medicare) Act proposed in the Bill relate to the use of the term ‘medicare’, and the situations when it can be used appropriately without breaching Government trademark.[27]

It would appear that the genesis behind these amendments is the establishment of Medicare Locals. One of the key initiatives arising out of the National Health Reform Agreement, which was signed by the Commonwealth and all the states and territories in August 2011, was the creation of Medicare Locals[28], which have been described as:

… primary health care organisations, to improve coordination and integration of primary health care in local communities, address service gaps, and make it easier for patients to navigate their local health care system. Medicare Locals will reflect their local communities and health care services in their governance, including consumers, doctors, nurses, allied health and State-funded community health providers.[29]

As stated in the Explanatory Memoranda:

The Medicare Act is being amended to ensure that the term ‘medicare’ can be used by authorised persons without breaching the Medicare Act. The amendments would enable Medicare Locals and other bodies seeking to use the term ‘medicare’ to apply for an authorisation to use the term.[30]

Subsection 41C(1) of the Human Services (Medicare) Act provides that it is an offence for a person to the use the term ‘medicare’ in ‘connection with a business, trade, profession or organisation’, whilst subsection 41C(2) states that is an offence to use the name ‘medicare’ as part of the name of an association.

According to the Department of Health and Ageing website, 61 Medicare Locals had commenced establishment and operational activities by 1 July 2012.[31] Medicare Locals are independent companies limited by guarantee, managed by skills based boards and are subject to the Corporations Act 2001.[32] All 61 Medicare Locals are currently breaching subsections 41C(1) and 41C(2) of the Human Services (Medicare) Act, as they are using the term ‘medicare’ in ‘connection with a business, trade, profession or organisation’ and using the name ‘medicare’ as part of the name of an association.

However, under subsection 41C(6), proceedings under the Human Services (Medicare) Act cannot be commenced without the consent of the Attorney-General. As the Government is obviously supportive of Medicare Locals using the term ‘medicare’, it is clear that no such action would ever have been brought (especially in light of the amendments proposed in this Bill, which confirm that authorisation will be given to Medicare Locals to use the term ‘medicare’).

The Explanatory Memorandum states that ‘the amendments will align the treatment of the term ‘medicare’ with the treatment of the term ‘centrelink’.[33] The Human Services (Centrelink) Act 1997 (the Centrelink Act)[34] sets out similar provisions in relation to the use of the terms ‘Commonwealth Service Delivery Agency’, ‘Centrelink’ and ‘CRS Australia’.[35]

There are a couple of differences between the operation of the Medicare Act and the Centrelink Act:

•       under section 38 of the Centrelink Act, the penalty for engaging in unauthorised conduct is a fine of up to 30 penalty units (which currently equals $3300).[36] Under the Medicare Act, the maximum penalty persons found breaching subsection 41C(1) will receive is a fine of $2000. Body corporates found to have breached subsection 41C(2) will face a maximum penalty of $4000[37] and

•       under section 38(1A) of the Centrelink Act, section 38(1) is a strict liability offence. Application of strict liability offences removes the requirement for the prosecution to establish either negligence or fault.[38] Therefore it is only relevant that the defendant did the act; there is no need to consider the presence or absence of negligence or whether the defendant intended to do the act.[39] There is no similar provision under the Medicare Act, though the onus is placed on the defendant to show they had authorisation to use the protected term or symbol.

It would appear that these differences are unlikely to be controversial. In regards to the provisions under the Medicare Act not being similarly specified as strict liability offences, it is possible the reason for this is due to the greater likelihood of a person/organisation using the term ‘medicare’ in good faith. There does not seem to be any reason for an organisation to be using the term ‘centrelink’ unless it is trying to mislead members of the public into thinking that if they provide their personal details to the organisation they will receive payments.[40] However, due to the link between the provision of medical services and claiming of payments through Medicare, there may be some circumstances in which a medical provider may refer to the term ‘medicare’ in good faith. It should be noted that subsections 41C(1) and (2) of the Human Services (Medicare) Act are partly in operation to protect consumers from being led into visiting health-care providers that advertise under the name ‘medicare’ as they may be under the impression that either all their costs will be recovered under Medicare, or that, because the health care provider is associated with Medicare, it will automatically bulk bill. As stated above, one of the reasons behind the amendments in the Bill is to allow Medicare Locals to use the term ‘medicare’ in their names. Ironically, Medicare Locals are not actually part of Medicare:

Medicare Locals are primary health care organisations established to coordinate primary health care delivery and tackle local health care needs and service gaps. They will drive improvements in primary health care and ensure that services are better tailored to meet the needs of local communities.[41]

Patients who attend a medical service that forms part of a Medicare Local will not receive any more money back from Medicare than they would had they visited a medical provider who is registered with Medicare. It is therefore likely that the decision to allow Medicare Locals to use the term ‘medicare’ in their names may lead to some confusion amongst patients who don’t understand the purpose of Medicare Locals. It would appear that such confusion has already occurred, with the Northern Melbourne Medicare Local specifying in the Frequently Asked Questions section of its website, ‘the name is confusing, but the Northern Melbourne Medicare Local is not part of Medicare’.[42]

It would not appear that it was ever the Government’s intention to mislead the public; rather the rationale behind the naming of Medicare Locals appears to stem from a marketing standpoint:

All Medicare Locals will be required to give due recognition to the Australian Government’s health reform agenda, as well as investment in the Medicare Locals program.

As such, Medicare Locals will be subject to common communications, marketing and branding protocols, which will be reflected in future funding agreements.

The Department will issue further advice and guidance on these matters in due course to successful Medicare Locals.[43]

As all Medicare Locals are being funded by the Government[44], it is reasonable that the Government wishes to use common branding to highlight the Government’s contribution, and as a way to identify which services are being authorised by the Government.

Items 20-22 of the Bill amend the Human Services (Medicare) Act to provide for exceptions to subsections 41C(1) and (2), which make it an offence to use the term ‘medicare’. Item 22 inserts proposed section 41CA, which sets out the circumstances where conduct that would normally breach sections 41C(1) and (2) of the Human Services (Medicare) Act can now be authorised. Particularly, proposed subsection 41CA(1) provides that subsections 41C(1) and (2) of that Act do not apply where authorisation has been granted under proposed subsection 41CA(2). Proposed subsection 41CA(2) allows the Secretary of the Department of Human Services (or a person the Secretary has delegated their powers to under proposed subsection 41CA(5))[45], to authorise, in writing, ‘specified conduct engaged in by specified persons’. The Secretary will also have the power to make the authorisation of the conduct subject to certain conditions. Under proposed subsection 41CA(3), an authorisation will cease to be in force where a person has contravened a condition of that authorisation. It is important to note that under proposed subsection 41CA(1), the defendant will have the onus of proving that they had authorisation under proposed section 41CA(2). Item 21 of the Bill repeals subsection 41C(6) of the Human Services (Medicare) Act, thereby removing the requirement to have the Attorney-General’s consent before commencing proceedings.

Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.

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ISSN 1328-8091

[1].               The text of the Food Standards Act can be viewed at: http://www.comlaw.gov.au/Details/C2012C00807

[2].               The text of the Health Insurance Act can be viewed at: http://www.comlaw.gov.au/Details/C2012C00678

[3].               The text of the Industrial Chemicals Act can be viewed at: http://www.comlaw.gov.au/Details/C2012C00762

[4].               The text of the Human Services (Medicare) Act can be viewed at: http://www.comlaw.gov.au/Details/C2012C00755

[5].               Explanatory Memorandum, Health and Other Legislation Amendment Bill 2012, p. 1, viewed 24 September 2012, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22legislation%2Fems%2Fr4887_ems_1356bd3b-8af4-462b-b68d-59a9ed6659a2%22

[6].               Selection of Bills Committee, Report No. 13 of 2012, Senate, Canberra, 11 October 2012, viewed 5 November 2012, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=selectionbills_ctte/reports/2012/rep1312.htm

[7].               Senate Standing Scrutiny of Bills Committee, Alert Digest No. 12 of 2012, Senate, Canberra, 10 October 2012, p. 14, viewed 5 November 2012, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=scrutiny/alerts/2012/index.htm

[8].               Parliamentary Joint Committee on Human Rights, Examination of legislation in accordance with the Human Rights (Parliamentary Scrutiny) Act 2011, Fifth report of 2012, Joint Committee, Canberra, 15 October 2012, p. 37, viewed 5 November 2012, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=humanrights_ctte/reports/5_2012/index.htm             

[9].               Ibid., p. 38.

[10].               Explanatory Memorandum, op. cit., p. 1.

[11].               Further information about FSANZ is available on its website: http://www.foodstandards.gov.au/

[12].               Explanatory Memorandum, op. cit., p. 4.

[13].               Section 22 of the Food Standards Australia New Zealand Amendment Act 2010 amended the Food Standards Act to repeal subparagraphs 146(6)(b)(i) and 146(6)(b)(ii). While the Explanatory Memoranda refers to the Food Standards Act being last amended in 2010, it has actually been amended subsequently by the Acts Interpretation Amendment Act 2011 and the Statute Law Revision Act 2012: Ibid., p. 4.

[14].               Further information about Medicare is available on its website: http://www.humanservices.gov.au/customer/services/medicare/medicare

[15].               T Plibersek, ‘Second reading speech: Health and Other Legislation Amendment Bill 2012’, House of Representatives, Debates, 19 September 2012, p. 11 171, viewed 24 September 2012, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22chamber%2Fhansardr%2F136b90b1-cf84-467a-9150-fe3c3b5cacda%2F0053%22

[16].               Division 2.36 of the Health Insurance Regulation 2012 sets out the relevant regulations.

[17].               T Plibersek, ‘Second reading speech’, op. cit., p. 11 171.

[18].               This reflects the current arrangements under subregulation 2.36.2(2) of the Health Insurance Regulation 2012.

[19].               The relevant professional services specified above are referred to under regulation 2.36.2 of the Health Insurance Regulation 2012 via reference to their Medicare numbers.

[20].               Explanatory Memorandum, op. cit., p. 6.

[21].               Regulation 2.36.1 of the Health Insurance Regulation 2012 provides a definition of ‘specialist trainee under the supervision of a medical practitioner’, which is a medical practitioner who is enrolled in and undertaking a training program with a medical college; and is supervised by a medical practitioner who is present at all times while the specialist trainee provides a medical service.

[22].               Further information about NICNAS is available on its website: http://www.nicnas.gov.au/default.asp

[23].               A Stevenson and M Waite eds, Concise Oxford Legal Dictionary, twelfth edn., Oxford University Press, Oxford, 2011, p. 1534.

[24].               Paragraph 21(6)(b) of the Industrial Chemicals Act.

[25].               Explanatory Memorandum, op. cit., p. 7.

[26].               Ibid.

[27].               Ibid., p. 1.

[28].               Department of Health and Ageing (DoHA), ‘Medicare Locals’, DoHA website, 9 July 2012, viewed 6 November 2012, http://www.yourhealth.gov.au/internet/yourhealth/publishing.nsf/Content/medilocals-lp-1

[29].               DoHA, ‘Guidelines for the establishment and initial operation of Medicare Locals’, DoHA website, 2011, p. 4, viewed 6 November 2012, http://www.yourhealth.gov.au/internet/yourhealth/publishing.nsf/content/featurednews-20110222b/$File/Medicare%20Locals%20Guidelines%20and%20Information%20for%20applicants.pdf

[30].               Explanatory Memorandum, op. cit., p. 6.

[31].               DoHA, ‘Medicare Locals’, op. cit.

[32].               DoHA, ‘Medicare Locals operational guidelines September 2012’, DoHA website, 12 September 2012, viewed 6 November 2012, http://www.yourhealth.gov.au/internet/yourhealth/publishing.nsf/Content/medicare-locals-operational-guideines-toc~Governance

[33].               Explanatory Memorandum, op. cit., p. 6.

[34].               A copy of the Act is available here: http://www.comlaw.gov.au/Details/C2011C00463/Html/Text#_Toc297017020

[35].               Section 38 of the Human Services (Centrelink) Act 1997 and regulations 6 and 7 of the Human Services (Centrelink) Regulations 2011, available at: http://www.comlaw.gov.au/Details/F2011L01375/Html/Text#_Toc295919474

[36].               One penalty unit is equal to $110: section 4AA of the Crimes Act 1914. However, the Crimes Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Bill 2012 will amend subsection 4AA(1) of the Crimes Act 1914 to increase the value of a penalty unit from $110 to $170. This Bill is currently before the Senate and it is likely that these changes will take effect in early 2013.

[37].               To clarify, the maximum penalties under section 41C of the Human Services (Medicare) Act are expressed in dollars, rather than penalty units.

[38].               Section 6.1 of the Criminal Code Act 1995.

[39].               PH Butt and D Hamer, eds., LexisNexis Concise Australian Legal Dictionary, fourth edn., LexisNexis Butterworths, Chatswood, 2011, p. 589. It should be noted that strict liability does allow for the defence of honest and reasonable mistake of fact to be raised: for further discussion on this see: Attorney-General’s Department (AGD), A Guide to framing Commonwealth offences, infringement notices and enforcement powers, September 2011 edition, AGD, p. 22, viewed 20 June 2012, http://www.ag.gov.au/Documents/FINAL+-+A+Guide+to++Framing+Commonwealth+OffencesPDF+version.pdf

[40].               Another reason a member of the public may use terms such as ‘medicare’ or ‘centrelink’ is when creating a website or blog complaining about these services.

[41].               DoHA, ‘Medicare Locals’, op. cit.

[42].               Northern Melbourne Medicare Local, ‘Frequently Asked Questions’, website, 2012, viewed 20 November 2012, http://www.nmml.org.au/page/QA/

[43].               DoHA, ‘Guidelines for the establishment and initial operation of Medicare Locals’, op. cit., p. 21.

[44].               The Government has committed to providing $477 million over four years for the establishment of a network of Medicare Locals. Once all Medicare Locals are established, the Government will provide approximately $171 million each year for the general operation of Medicare Locals: Ibid., p. 8.

[45].               Under proposed subsection 41CA(5) of the Medicare Act, the Secretary may delegate their powers under proposed subsection 41CA(2) to either the Chief Executive of Medicare or any other APS employee in the Department of Human Services or an APS employee in the DoHA. A delegate must comply with any written conditions of the Secretary: proposed subsection 41CA(6).