Ged Kearney (Cooper, Australian Labor Party, Assistant Minister for Health and Aged Care) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

Today, I will be introducing three bills:

This package of bills supports the implementation of the 2021-22 budget measure, Modernising and Improving the Private Health Insurance Prostheses List.

This first tranche of legislative changes is required to fully implement measures that will support, modernise and improve the private health insurance prostheses list, which will now be known as the prescribed list.

The first bill I'm introducing is the Private Health Insurance Legislation Amendment (Medical Device and Human Tissue Product List and Cost Recovery) Bill 2022.

The measures in this bill are important, as they will broadly support further reform activity aimed at keeping downward pressure on private health insurance premiums by reducing the costs associated with medical devices and human tissue products. This will be achieved by modernising administrative processes and cost-recovery arrangements, which will improve the affordability and attractiveness of private health insurance for consumers. This is good news for privately insured Australians, who paid around $26 billion dollars in premiums in the year ending 30 June 2022.

The Australian health system operates under a mixed model of private and public health care, with private hospitals and private health insurers playing critical roles. Australian consumers with private health insurance may choose to receive treatment as private patients in either private or public hospitals.

For privately insured patients with eligible health cover, private health insurers are required to pay set benefits for certain kinds of devices and products. Expenditure on medical devices and human tissue products accounts for around 14 per cent of the private health insurance benefits paid annually. It is therefore important that Australians continue to receive value for money for their private health insurance, including when it comes to treatment with medical devices and human tissue products.

Under these measures, there would be no additional out-of-pocket costs for consumers on an ongoing basis. The measures will also benefit consumers by supporting access to innovative medical devices and technology on the prescribed list.

The government recognises the important role medical devices and human tissue products play in the overall health of Australian patients.

The bill will provide greater clarity about the kinds of products intended to be accessed through this system. The measures will ensure not only certainty about the benefits that are reimbursed but that they are cost effective. This will provide increased transparency for the medical technology industry, hospitals, clinicians, private health insurers and consumers.

The bill also renames the relevant legislative instrument that may specify the benefits for these devices and products. The new name will be the Private Health Insurance (Medical Devices and Human Tissue Products) Rules. This new name reflects the clarified scope of medical devices and human tissue products for which private health insurers must pay set benefits.

The bill also updates the cost-recovery arrangements by introducing a fee-for-service based approach, where the fees paid by medical device sponsors to list their products reflect the effort required to assess the application.

These arrangements will support a predictable environment in which sponsors can have the confidence to continue to provide medical devices and human tissue products to Australians while also maintaining a stable, sustainable and innovative industry sector.

Importantly, the bill does not affect clinician or patient choice in the private health system, and it does not affect access to medical devices or human tissue products.

Overall, the bill supports the government's priorities of ensuring that people can access affordable treatments and that Australians with private health insurance get value for money.

Debate adjourned.