Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021 [2021] AUSStaCSBSD 59 (17 March 2021)

• Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021
• Significant matters in delegated legislation47

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Private Health Insurance Legislation Amendment (Age of Dependants) Bill 2021

Purpose	This bill seeks to amend the Private Health Insurance Act 2007 and associated legislation to: • change the maximum allowable age for people to be covered under a family private health insurance policy as a dependent up to 31 years old; and • allow people with a disability, regardless of their age, to be covered under family private health policy as a dependent
Portfolio	Health and Aged Care
Introduced	House of Representatives on 25 February 2021

Significant matters in delegated legislation^[47]

1.113 Items 14 and 16 of the bill seek to amend the Private Health Insurance Act 2007 (the Act) to allow for the new term ‘person with a disability’ to be defined by the Minister for Health in the Private Health Insurance (Complying Product) Rules. Item 20 seeks to insert the definition of 'dependent person with a disability' into the dictionary in Schedule 1 to the Act as meaning a person who is aged 18 years or over and who is:

• a person with a disability within the meaning of the expression person with a disability as defined by the Private Health Insurance (Complying Product) Rules; or

• a person with a disability within the meaning of the expression person with a disability as defined by the *rules of the private health insurer that insures the person.

1.114 This new definition is relevant to items in the bill which seek to provide that a person with a disability may be covered by their family's private health insurance policy regardless of their age.

1.115 The committee's view is that significant matters, such as the definition of 'person with a disability' for the purposes of a legislative scheme, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided. In this instance, the explanatory memorandum contains no justification regarding why it is necessary to allow such significant matters to be set out in delegated legislation. The committee notes that a legislative instrument, made by the executive, is not subject to the full range of parliamentary scrutiny inherent in bringing proposed changes in the form of an amending bill.

1.116 The committee also notes that the statement of combability provides information as to the definition that is expected to be included in the rules:

It is proposed a definition of disability will be included in the Private Health Insurance (Complying Product) Rules, and this will be ‘a participant under the National Disability Insurance Scheme under the National Disability Insurance Scheme Act 2013’. It is also proposed private health insurers will be permitted to be more expansive in their definition under their insurer rules, but will not be able to apply a narrower definition than that in the Rules. The commencement date will be stated in the Rules.^[48]

1.117 It is unclear to the committee why this proposed definition, or other high-level guidance in relation to the definition cannot be provided on the face of the bill. The committee also notes that there appears to be no requirement on the face of the legislation to require that private health insurers will not be able to apply a narrower definition than that in the rules.

1.118 In this regard, the committee notes that the definitions of 'dependent non-student' and 'dependent student' to be inserted into the Schedule 1 dictionary also apply definitions of the 'rules of the private health insurer that insures the person'. These rules are defined in Schedule 1 to the Act as being:

the body of rules established by the insurer that relate to the day‑to‑day operation of the insurer’s *health insurance business and (if any) *health‑related business.^[49]

1.119 The explanatory memorandum does not address why it is necessary or appropriate for the definitions of 'person with a disability', 'dependent non-student' and 'dependent student' to rely on rules established by private health insurers, which appear to be non-legislative documents that are not subject to any form of parliamentary scrutiny and may not be publicly accessible.

1.120 In light of the above, the committee requests the minister's detailed advice as to:

• why it is considered necessary and appropriate to leave the definition of 'person with a disability' to delegated legislation;

• whether the bill can be amended to include on the face of the primary legislation:

• at least high-level guidance regarding this definition, and

• the requirement that private health insurer rules may not apply a narrower definition of 'person with a disability' than that in the rules; and

• why it is considered necessary and appropriate to apply definitions set out in rules of a private health insurer to the definitions of 'person with a disability', 'dependent non-student' and 'dependent student'.

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[47] Items 14, 16 and 20. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).

[48] Statement of compatibility, p. 3.

[49] See Clause 1 of Schedule 1 to the Private Health Insurance Act 2007.