Hospital funding hole partly plugged

Tuesday, May 3, 2016

The Australian Healthcare and Hospitals Association (AHHA) acknowledges the Commonwealth Government’s budget commitment to a hospital funding growth formula capped at 6.5 per cent per annum (or an estimated $2.9 billion) from 2017 to 2020, as per the agreement reached with the states and territories at the 1 April meeting of the Council of Australian Governments (COAG) .

“While welcome, this measure goes less than half way to addressing the cuts to expected public hospital funding from 2017 to 2020 which were flagged in the 2014 and 2015 Budgets,” says Alison Verhoeven, AHHA Chief Executive.

“The shift away from the Coalition’s previous stance on funding based only on population and CPI growth; and a return to activity-based funding based on a national efficient price is sensible. Further work should now be progressed on this methodology, including a focus on safety, quality and reducing preventable hospitalisations.

“While the improved support for hospital funding until 2020 has provided some relief for the hospitals sector, concerted efforts will be required to reduce the increasing demand for hospital services. Primary care reforms will be critical to contributing to this, including ensuring adequate financial support, appropriate workforce and service structures in primary care: but tonight’s budget provides little comfort in this regard.

“Savings flagged in the aged care provider funding of $1.2 billion over 4 years will also potentially impact on hospitals who traditionally pick up complex care when the aged and community care sector cannot deliver appropriate support to elderly people,” says Alison Verhoeven.

“Unfortunately for the states and territories, and for Australians who rely on public hospitals, hospital funding remains a hole that is only partly plugged.”

Media enquiries:
Alison Verhoeven
Chief Executive, The Australian Healthcare and Hospitals Association
0403 282 501