Health Budget: long-term vision must prevail over short-term actions

Tuesday, May 12, 2015

Health Budget: long-term vision must prevail over short-term actions

The Australian Healthcare and Hospitals Association (AHHA) is pleased that the Commonwealth Government has committed to a stronger focus on strategic, long-term health policy in its 2015-16 Budget media statement. But the devil is in the detail, and there is a distinct lack of information or long-term planning evident for many important program areas in health.

AHHA Chief Executive Alison Verhoeven said that the Government needs to move away from its haphazard approach to health policy, based on short-term funding measures, announcements of reviews without subsequent public reporting, and deferring complex issues for future Reform of Federation discussions.

“While Minister Ley has taken some important steps in building the credibility of the Commonwealth Government in the health sector, such as instigating a long-overdue review of the MBS, the continued failure to honour hospital funding arrangements, which were built on bipartisan agreement, is very disappointing,” says Ms Verhoeven.  “The move away from activity-based funding and an efficient pricing formula - and the $57 billion that was slashed from hospital funding in last year’s budget - will have a significant impact on the sector between 2017-18 and 2024-25.”

“The Government must not drag the chain on getting its own house in order.  Last year’s Budget announcements about closures or mergers of a number of health agencies to address duplication of activity have only been partially implemented.  With savings of $96 million to be achieved through efficiencies in the Department of Health, we expect these plans should be effected in a timely manner. 

“Tonight, the Government has indicated that around $1 billion will be removed over 5 years from a range of program areas, including those managed as flexible funding, yet the Department of Health was unable to clarify which programs would be affected.  As these funds support programs across important areas such as alcohol and drug services, mental health, Indigenous health and palliative care, and many are delivered by not-for-profit agencies, the level of funding uncertainty will have profound impacts on the sector.

“The lack of commitment to preventive health, including a specific cut to research, is also deeply concerning in a health system which is grappling with an increasing burden of chronic disease. Likewise, one year funding arrangements to support dental health, despite media fanfare from the Government on this important issue, are very disappointing.

"The AHHA urges the Government to further engage hospitals and health service providers, consumers and the broader health system in its decision-making processes to ensure the implications of any large-scale changes across the sector are considered. We look forward to participating actively in this process, in our role as the peak body representing public and not-for-profit health service providers in both the primary and acute care sectors," says Ms Verhoeven.


The AHHA represents Australia’s largest group of health care providers in public hospitals, community and primary health sectors and advocates for universal high quality healthcare to benefit the whole community.

Media enquiries:

Alison Verhoeven, Chief Executive, 0403 282 501