Report on the regulatory framework for hearing services

Option B - Incremental changes that continue to utilise the existing legislative and contractual framework

Review of the efficiency and effectiveness of the regulatory framework for hearing services July 2012. The Report was prepared for the Office of Hearing Services by MP Consulting

Page last updated: 28 November 2012

Description of the option

Consistent with the approach adopted over the last year (whereby OHS has worked with the sector to improve the service provider contract and the Rules of Conduct), the regulation could continue to be revised and improved annually within the existing framework.

For example, following completion of the work detailed at the commencement of this Chapter, the following changes could be made:
  • all instruments relating to vouchers, eligibility and participants could be consolidated into one document (delegated legislation as required by the Act). This means that, other than the Act, there would be one main document that describes the relationship between the Commonwealth and the client
  • all instruments describing the obligations of the service provider could be consolidated into two documents – the contract and the Rules of Conduct. This means that, other than the Act, there would only be two documents that describe the relationship between the Commonwealth and the service provider. This approach would mean:

    – amending the contract to remove all of the obligations that relate to the provision of services including record keeping and site requirements. All of these obligations would be included in the one set of Rules of Conduct

    – the new Rules of Conduct would describe all of the conditions of service that are currently scattered throughout the Hearing Rehabilitation Outcomes for Voucher Holders, the eligibility criteria for refitting, the contract, the Deed and the Schedule of service items

    – the contract would only retain the essential contract provisions and would also include the service items as a Schedule. All payment related information would be included in the one schedule to the contract. This would be a revised and combined schedule of items and fees

    – in the absence of amendment to the Act there must continue to be an accreditation scheme, but the written instrument (delegated legislation) describing the scheme could be amended to make the accreditation process more minimalist.
  • if the Deed were retained (which it may not need to be), this could be amended such that it only describes the relationship between the Commonwealth and the device supplier. It would not include any conditions that relate to the service provider.

The advantages and disadvantages of the option

The main advantages of this approach are that:
  • it will improve clarity – the roles, responsibilities and obligations of each of the stakeholders will be described in one or two cohesive documents that are applicable to each group
  • it is incremental
  • it does not require changes to the Act
  • it maintains the existing regulatory structure which is familiar to stakeholders
  • it addresses some of the significant issues of: lack of clarity, overlap and duplication.

A number of the advantages detailed above are also disadvantages. For example, this option:
  • does not address some of the structural problems with the scheme. It continues to mean that the ‘rules’ of the scheme are described in an Act, delegated legislation, contract and potentially a Deed
  • it does not address some of the areas of duplication – for example it continues to require accreditation in addition to warranties being made through the contract.

If this approach is to be effective in addressing some of the problems identified in this report, significant work will need to be done by the OHS and stakeholders to determine the focus of regulation (i.e. the problem to be addressed and the risk to be mitigated) and to streamline and re-work the processes and obligations such that they align with the objects of the regulation and the risks to be addressed. This will be a time consuming process.

Once this is settled the flow-on changes to the regulatory instruments will be relatively straightforward. Top of Page

The extent of legislative drafting required

  • No amendments would be required to the Act but amendments would be required to each piece of delegated legislation and to the contract and Deed.

Implementation timeframes

  • In order to minimise the disruption caused by regular changes to regulation, it is recommended that all changes to the instruments take effect at the same time. Ideally, the date of effect would be the commencement of a financial year. The implementation timeframes will be influenced by the outcomes of stakeholder consultation and available resources.

Cost implications

There will be costs to government as a result of undertaking consultation on the incremental changes, ensuring requirements of the Office of Best Practice Regulation are met, drafting new instruments, and ensuring that internal and external stakeholders are educated about the changes. These administrative costs would be greater than the costs associated with option A but are likely to be less than the costs associated with option C.

Each time improvements are made to the regulation there are likely to be small cost savings to government and to industry.

The extent of the cost savings will depend on the extent of changes to processes (e.g. voucher process, accreditation and notifications) and the extent of changes to conditions (e.g. record keeping requirements).

Even a small change to, for example, record keeping can have a large impact across 215 providers and 1660 practitioners.

Similarly, if voucher requirements were removed (and practitioners could assess eligibility) this would shift some cost to industry but would reduce costs to government and also positively impact clients.
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