Where: j = group of equivalent episodes Where: j = group of equivalent episodes of hospital treatment under the RHBO’s HPPAs (or similar arrangements)

Where: j = group of equivalent episodes of hospital treatment under the RHBO’s HPPAs (or similar arrangements)

i = group of the RHBO’s HPPAs (or similar arrangements) in force on 1 August of the first year with comparable private hospitals, or with all private day hospital facilities, in the State

n= the number of the RHBO’s HPPAs (or similar arrangements) in force on 1 August of the first year with comparable private hospitals, or with all private day hospital facilities, in the State

Rji = charge for episode of hospital treatment type j in contract i

Rj = average charge for episode of hospital treatment type j

(4) In subclause (3), each “episode of hospital treatment” must be identified using the patient classification system and payment structure in the majority of the relevant RHBO’s HPPAs (or similar arrangements) in force on 1 August of the first year with:

(a) all comparable private hospitals in the State in which the facility is located (if treatment was provided in a facility that was a private hospital); or

(b) all private day hospital facilities in the State in which the facility is located (if the treatment was provided in a facility that was a private day hospital facility).

(5) In subclause (3), for the purpose of calculating the “average charge for the equivalent episode of hospital treatment” in a State:

(a) the charge will include the sum of the amount payable by the RHBO under that RHBO’s HPPAs (or similar arrangements) and any excess or co-payment amounts payable by members, in accordance with the RHBO’s rules.

Note: RHBO members’ financial obligations under such levels of cover will still apply.

(b) charges referred to within the RHBO’s HPPAs (or similar arrangements) for no gap prostheses and gap permitted prostheses determined under subsections 73AAG(6) and (7) of the Act must not be included; and

(c) charges referred to within the RHBO’s HPPAs (or similar arrangements) for hospital treatment provided to patients who are classified as nursing-home type patients (NHTPs) must not be included.

(6) Subject to subclause (8), if a RHBO has less than five HPPAs (or similar arrangements) in force on 1 August of the first year with a particular class of comparable private hospitals in a State, then all of that RHBO’s HPPA’s with all classes of private hospitals in that State are to be used to calculate the minimum benefit payable.

(7) Subject to subclause (8), the minimum level of benefit payable by a RHBO in respect of a rehabilitation episode of hospital treatment between 1 September of a particular year (“the first year”) and 31 August of the next year will be:

(a) no less than 85% of the average charge for rehabilitation episodes of hospital treatment under all of that RHBO’s HPPAs (or similar arrangements) that were in force on 1 August of the first year with all comparable private hospitals in the State in which the facility is located if:

(i) treatment was provided in a facility that was a private hospital; and

(ii) the RHBO has directly linked the payment of benefits, under its HPPAs (or similar arrangements) with comparable private hospitals in the relevant State, for rehabilitation episodes of hospital treatment to the AN-SNAP rehabilitation classification system for the 12 months preceding and including 1 August of the first year; or

(b) no less than 85% of the average charge for rehabilitation episodes of hospital treatment under all of that RHBO’s HPPAs (or similar arrangements) that were in force on 1 August of the first year with all private day hospital facilities in the State in which the facility is located if:

(i) the treatment was provided in a facility that was a private day hospital facility); and

(ii) the RHBO has directly linked the payment of benefits, under its HPPAs (or similar arrangements) with private day hospital facilities in the relevant State, for rehabilitation episodes of hospital treatment to the AN-SNAP rehabilitation classification system for the 12 months preceding and including 1 August of the first year; or

(c) in any other case, an amount based on the AN-SNAP rehabilitation classification system negotiated by the RHBO and the facility.

(8) If the minimum level of benefit payable under subclauses (3), (6), or (7) in respect of an episode of hospital treatment is below the level set in Schedules 1, 2, 3 or 7 of the Determination made under paragraph (1)(bj) of Schedule 1 of the Act, then the minimum level of benefit payable under this Schedule 5 is that set in Schedules 1, 2, 3 or 7 of the Determination made under paragraph (1)(bj) of Schedule 1 of the Act for that episode of hospital treatment.