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General PHIAC Circulars
SBA Circulars
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General PHIAC Circulars
Circular No 05/13
Contact Officers:
Gayle Ginnane (02) 6215 7999
email: gayle.ginnane@phiac.gov.au
Replaces Circular: 04/07
19 August 2005 |
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PHIAC LEVIES - FROM 1 JULY 2005
Background
PHIAC raises its levy under the following acts:
• The Private Health Insurance (Council Administration Levy)
Act 2003,
• The Private Health Insurance (ACAC Review Levy) Act 2003,
• The Private Health Insurance (Collapsed Organisation Levy)
Act 2003,
• The Private Health Insurance (Reinsurance Trust Fund Levy)
Act 2003,
The total amount of each Levy is specified in separate Regulations which
underpin the corresponding Levy Act. For 2005-06, the amounts are:
• Council Administration Levy - $4,435,000
• ACAC Review Levy - $5,000
• Collapsed Organisation Levy – to be specified in the event
of a collapsed organisation
• Reinsurance Trust Fund Levy – specified quarterly on the
Levy Day as defined below.
Calculation of the Administration and ACAC Levies
Prior to 1 July 2004, PHIAC set one annual levy for the Administration
and ACAC expenses, combined. The levy was expressed in a fixed number
of cents per SEU. Each registered organisation’s quarterly levy
was determined by the number of hospital SEUs, multiplied by one quarter
of the annual levy in cents. The total levy raised by PHIAC during the
financial year fluctuated slightly with any movement in membership.
Under the current arrangements, the total levy raised will be fixed rather
than the cents charged per SEU. Therefore, because the levy will continue
to be calculated on a per-SEU basis, the cents charged per SEU each quarter
will fluctuate slightly with the movement in membership.
The formula for calculating the quarterly Administration Levy is:
Total Council Administration Levy amount divided by four in cents
________________________________________________________
Number of Hospital SEUs of industry at end of quarter Y
= x.x cents
For example,
Quarterly Levy amount in cents (110,875,000)
_________________________________________
Number of Hospital SEUs at 30 June (6,293,310)
= 17.62 cents per SEU for the Septmeber quarter
The formula for calculating the quarterly ACAC Review Levy is the same
as for the Administration Levy.
For example,
Quarterly Levy amount in cents (125,000)
_________________________________________
Number of Hospital SEUs at 30 June (6,293,310)
= 0.02 cents per SEU for the Septmeber quarter
The Administration and ACAC quarterly levies will be separately identified
on a single invoice.
Calculation of the Reinsurance Levy
The Reinsurance Levy is the calculation of payments into and from the
Reinsurance Trust Fund. Payments are calculated in accordance with the
Health Benefits Reinsurance (Trust Fund Principles) Determination 1998
made under Section 73BC (5B) of the National Health Act.
Timing of the Levies
The timing of the Reinsurance quarterly levies is shown in the following
table:
The timing of the Administration and ACAC quarterly levies is shown in
the following table:
Definitions
The definition of the Days referred to in the above table are explained
below:
Definitions:
Census Day
The day PHIAC 1 returns are due to PHIAC for quarter ending 28 days prior
to the Census Day.
Levy Day
The day PHIAC invoices registered organisations for each Levy.
Invoices for the Council Administration and ACAC Levies are to be posted
no later than the 28th day of the second month of each quarter.
Invoices for the Reinsurance Trust Fund Levy are to be posted no later
than the 21st day of the second month of each quarter.
Payment Day
The due date for each quarterly levy payment. Payment is due the 14th
day after the Levy Day
Payment of Levies
Registered organisations are to deposit all levy payments into the PHIAC
Receipts Account. Levy payments are transferred by PHIAC into the Official
Public Account (OPA) on a daily basis.
Penalty Payments
Late payments will be penalised at the rate of 15% per annum. This penalty
applies to all levies under the new arrangements.
Interest
PHIAC will continue to earn interest on the balances of its operating
accounts. The practice of redistributing the interest earned on the Reinsurance
Trust Fund Pool each quarter will continue.
If you have any queries relating to the new Levy arrangements, you are
encouraged to contact Gayle Ginnane by telephone on 02 6215 7999 or by
email gayle.ginnane@phiac.gov.au.
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