Rudd's Hospital Plan

[Maxine]

Rudd's hospital overhaul to cost states $50b

By online political correspondent Emma Rodgers

Updated 1 hour 28 minutes ago
New plan: the Commonwealth will take on 60 per cent of all hospital funding

New plan: the Commonwealth will take on 60 per cent of all hospital funding (ABC News)

* Related Story: Hospital funding shake-up no takeover--http://www.abc.net.au/news/stories/2010 ... 833978.htm
* Related Story: Abandon plans for health takeover: Brumby--http://www.abc.net.au/news/stories/2010 ... 834039.htm
* Related Story: AMA gives federal health takeover the tick--http://www.abc.net.au/news/stories/2010 ... 834557.htm
* Related Story: Rudd's health plan sets 'silo mentality' for states--http://www.abc.net.au/news/stories/2010 ... 834949.htm
* Related Link: Official plan: national health and hospitals network--http://www.abc.net.au/news/documents/sc ... 9q7cjzuc9o

Prime Minister Kevin Rudd has unveiled a sweeping national plan to take control of Australia's hospital funding by clawing back $50 billion of GST revenue from the states and territories.

Mr Rudd, who outlined the major changes at the National Press Club today, is likely to face some opposition from state and territory leaders.

The changes would see the Government directly fund the country's public hospital system in a bid to stamp out waste and also include a full federal takeover of all GP and primary healthcare services.

The plan will be funded by pumping one third of the states' GST allocations - which amounts to $50 billion over the forward estimates - directly into hospitals.

The Commonwealth will take on 60 per cent of all hospital funding, which includes the average cost of each patient, ongoing funding for research, training, maintenance and improvements.

That share of hospital funding will cost the Federal Government $30.9 billion over the forward estimates and primary care funding will cost $18.7 billion.

The administration of the funds will be done through local authorities, which will oversee small groups of hospitals and will be subjected to "strong national standards".

These authorities will be will be paid by the Federal Government on the basis of each patient they treat and an independent body will be established to set the "efficient" cost of each treatment.

Funding will also be linked to a hospital's efficiency, with national standards to be set and performance statistics published.

"For the first time there will be nationally consistent performance standards for hospitals in critical areas such as emergency departments and elective surgery to help reduce waiting times for the public," Mr Rudd said.

The Government has also pledged to allow doctors and nurses more of a say in their local authority.

The Government says the plan is fully funded over the forward estimates.

It says no states or territories will be worse off over the next four years and they will be better off in the medium term.

"For the first time, eight state-run systems will become part of a national network," Mr Rudd said.

To convince the states to relinquish control, the Government argues that growing health care costs as the population ages will become larger than growth in GST revenues.

http://www.abc.net.au/news/stories/2010 ... 834814.htm

Note the "groups of hospitals" a local board for each as Tone wants won't work as regional hospitals share equipment/skills, e.g. an MRI machine at one shared by other hospitals who send patients there for MRI scans.

Typical brainless Lib comment:

Opposition health spokesman Peter Dutton says the Government will not be able to deliver the reforms.

"They can't even deliver a give-away program of $1 billion of pink batts so how on earth can the Prime Minister manage a $100 billion health system," he said.

"Over the past two years, Kevin Rudd has seen the situation in public hospitals deteriorate, he's presided over a system where despite having put a couple of billion dollars in waiting lists, the waiting lists have blown out."

(Ibid)

Yup as waiting lists got cleared people who had given up hope put themselves on the waiting list. Evidently, too tough for the soon to be ex-member for Dickson.

[Maxine]

Top bureaucrat casts doubt on hospital overhaul

One of Australia's most distinguished health bureaucrats has cast doubt on the ability of Kevin Rudd to deliver his hospitals plan, saying it would be ''extraordinarily difficult'' to implement key proposals.

The warning came as Health Minister Nicola Roxon said she could not rule out tax increases to pay for the hospitals funding overhaul, which is still facing resistance from several states, including Victoria.

As Ms Roxon and the Prime Minister stepped out to promote their plan, Stephen Duckett, a former federal Health Department head, said the government might have underestimated the difficulty of implementing two key elements: national price-setting for hospital services and local hospital networks.

Dr Duckett, a member of the National Health and Hospitals Reform Commission, welcomed the Rudd plan as a good response to the proposals of the commission, which spent 16 months canvassing ideas across the country.

But he warned of problems ahead, and said the roof insulation fiasco had shown the government was ''not strong on implementation'' of services on the ground. [We will ignore this, he is in Canada and wouldn't know the full story.]

He specifically questioned the plan for a national ''case-mix'' system to set standardised prices for hospital services. ''It will be extraordinarily difficult to implement the case-mix system on a national scale,'' said Dr Duckett, who was responsible for introducing the system into Victoria in the early 1990s.

Differences among the states in the cost of procedures and even in superannuation would generate significant barriers to calculating a standardised pricing formula.

The challenge of adjusting funding to the states to allow for differences in costs for Aboriginal and rural services would also be complex. ''The Commonwealth has not demonstrated it has the skill to do it.''

Dr Duckett, who now heads Alberta Health Services in Canada, also questioned the plan to appoint local clinicians and community leaders to the boards of new hospital networks. He said it appeared Mr Rudd might have underestimated the tendency for boards to pursue local interests at the expense of the overall capacity to fund projects. The provision of 150 to 180 local hospital networks would create a big demand for executive expertise not readily available in many centres. . . .

The government cites findings by the health reform commission that the new approach to pricing of hospital services would produce savings of $300 million to $1.5 billion a year.

Dr Christine Bennett, who chaired the commission, gave a more positive response to the Rudd plan than Dr Duckett, saying she and fellow commissioners were pleased with how closely the government's plan mirrored their recommendations.

''There are some differences - some of it is half a step forward and some is half a step sideways - but it is definitely all there,'' she said.

The move to Canberra paying 60 per cent of every public patient admission took her by surprise - the commission had recommended starting at 40 per cent and gradually increasing over time.

But Dr Bennett called for doctors, nurses and other health workers to support the plan, which she said was a ''good first step'' towards a better health system.

http://www.theage.com.au/national/top-b ... -plv4.html

So really, there will be some problems but overall very good.

I like the fact that there will be boards for hospital networks--small rural hospitals are not independent, they form groups, co-ordinate etc to afford various big expensive bits of gear--Abbotts local boards for each hospital would be a disaster in Qld & NSW especially, doubt the idiot has worked it through, doubt he would move to have it implemented if he were to win the election as he didn't when Health Minister. Just a nothing policy.

[Maxine]

And the States will accept the proposal--they are looking down the barrel at huge health cost blowouts:

The states must give an answer at an April 11 Council of Australian Governments meeting or face a referendum. South Australia and Queensland have agreed to the proposal and NSW is favourable. The Western Australian Liberal Premier, Colin Barnett, and Victoria's John Brumby, remain hostile.

To encourage the states, the Commonwealth will reduce their share of health funding from 60 per cent to 40 per cent and free them from having to pay for the ever-growing gap between health costs and revenue.

In the five years from 2014-15, that blowout between costs and revenue is estimated to reach $15.6 billion.

Mr Rudd said if the states did not sign up, they, not the Commonwealth would have to find this money. The cost to NSW alone would be $4.9 billion, including $1.6 billion in 2019-20.

http://www.smh.com.au/national/tax-rise ... -pls6.html

Of course the idiot Fielding has said he will oppose the plan and the Coalition has said they will too but when the states agree--and agree they will--they will fall into line. We all know the Baby Boomers are aging and beginning to retire en masse from this year and so there are just going to be increasing health costs.

[Maxine]

Rudd, of course, would love a big fight with the states! He wants to distance himself from NSW govt which is as popular as leprosy. And while this big states v commonwealth fight is happening in an election year the Opposition even with Murdoch and the OBC will struggle to be heard let alone try to differentiate itself on health:

NSW denies sabotaging Rudd's reforms

New South Wales Health Minister Carmel Tebbutt has denied Prime Minister Kevin Rudd's claims that state bureaucrats are trying to sabotage his hospital reforms.

Earlier today Mr Rudd fired a shot towards his New South Wales colleagues amid reports his new blueprint could force the closure of over 100 hospitals in the state.

The reforms would see the Commonwealth take control of hospital funding, covering 60 per cent of costs by clawing back a third of GST revenue.

The funds would be administered by local authorities who would fund patients on a per-patient basis, described as "casemix".

The new funding formula has raised concerns that some regional hospitals that do not perform many procedures will miss out.

Mr Rudd today accused NSW bureaucrats and politicians of running a "fear campaign" and has told them to stop blocking reform.

But Ms Tebbutt says his accusations are unfounded.

"I had absolutely nothing to do, [and] my office had nothing to do with that information getting out into the public domain," she said.

http://www.abc.net.au/news/stories/2010 ... ion=justin

So yes the States will accept it--State Treasurers must become gloomy looking at projected health costs--but the States too will benefit from fighting the Commonwealth and State oppositions would be drowned out--about 3 state elections are due I think in next 12 months, incl NSW early next year.

[Maxine]

Rudd to meet premiers over health shake-up

The Prime Minister Kevin Rudd will this morning begin a round of meetings with state premiers to push his plan to overhaul the health system.

Mr Rudd will meet the New South Wales Premier, Kristina Keneally, in Sydney.

He plans to talk with the other premiers and chief ministers individually between now and mid-April, when they will meet in Canberra to talk about his proposal.

However, some premiers have expressed concern about aspects of the plan and are calling on Mr Rudd to release the entire package.

Ms Keneally has scheduled a separate meeting with other premiers and chief ministers to discuss how the states should respond to the Federal Government plan.

http://www.abc.net.au/news/stories/2010 ... ion=justin



There you go, Darth Revan, get your choppers into that!

[donniedarko]

The amount of time saved through the elimination of arguing btw states and commonwealth alone will go a long long long way. It's very difficult for non-beauracrats to realise how much time state health beauracrats (kaff kaff) spend arguing with the commonwealth, or even arming the health minister with data to try and flog the commonwealth/liberal party.

I don't disagree with most of your points Maxine, except for part about ignoring Stephen Duckett. He would know far more about this that anyone working in Rudd's team, and is an international expert on activity-based funding.

What seems unclear in all this, is that the role of actually operationally running hospitals will still be done by a local govt group, and service planning will still be done by some sort of state health dept. So, the c'wealth gives the money, but the states are still having to manage everything, which is a bit of an unknown as states (read QLD) aren't used to having to either a) perform in order to get money, or b) be granted any sort of penalty or reward for performing well.

If a smallish hospital is being reimbursed for the patients they see, then it would be safe to assume that they don't generate much revenue (not many complex patients = not much $$ received by the hospital per patient.) Not generating revenue means they cannot offer expensive services like cancer treatment or diagnostics, so they still have to travel to bigger hospitals/cities etc. So, it's hard to tell how the punter in the boonies will benefit.

Much spank is given to Victoria being the shining quarterback in hospital performance with a historical basis in activity-based funding, but Qld and WA have vastly different geographies and rural challenges than Vic, so it's a bit dim to assume those states will automatically osmose to the performance level of Vic.

This whole thing about hospital boards is just an emotive rudder at this time - it's too difficult to accurately see how this will fail/succeed. The biggest risk to local health networks is that if they gain the autonomy to do things their own way, the ability to maintain common standards (across a state) may falter. If hospitals decide to adopt a unique way of recording hospital patient data, it then becomes impossible for a state to produce whole-of-state performance reporting that is of acceptable validity. Which may not in itself be a bad thing, but it's generally easier to have one voice of truth than listening to 20 out-of-tune warblers.

Medicare took 15 years to implement, and it was easier than the national health reform (from 'The Weekly' today). I don't personally think the states are able to predict with enough accuracy what the actual effects of the reform package are going to be - they can't tell if things will be better or worse (they may be better to the average sick person, but the higher levels of govt are pretty shit at seeing how things move at the ground level).

We will know far more after the COAG next month. Rudd is being a bit blasty with this whole thing - a referendum may work but he will still have to work with the states to define the new health areas etc, so he can't really afford to piss the states off totally at this point.

But, for me, full kudos to Rudd for at least having the balls to propose an alternate future. Major health reform is extremely risky, and this one is an uber reform. But, if it does come off, and both state govts and local patients are able to see a stable ongoing improvement in health care then Rudd's history chapter looks pretty safe.

[Howard Stinks]

But, for me, full kudos to Rudd for at least having the balls to propose an alternate future. Major health reform is extremely risky, and this one is an uber reform. But, if it does come off, and both state govts and local patients are able to see a stable ongoing improvement in health care then Rudd's history chapter looks pretty safe.

i second that!

[boxy]

How exactly are they going to make a payment per patient/procedure work, and still ensure it remains equitable for regional/remote people? It is just going to encourage centralisation due to economies of scale in a system that needs to be decentralised (at least for common procedures) to provide accessible care for all.

[Howard Stinks]

How exactly are they going to make a payment per patient/procedure work, and still ensure it remains equitable for regional/remote people? It is just going to encourage centralisation due to economies of scale in a system that needs to be decentralised (at least for common procedures) to provide accessible care for all.

I think we need a medical examination,are the doctors. dentists and all the other medical specialist over payed? Fair enough they go through a lot of study and all that, but what about their social responsibility? What good are doctors with a lot of qualifications when the majority can not afford them? It looks to me that some sections of our community are above every one else at a time of a GFC.Lawyers are in the same boat.At a time when workers have to take a pay cut to keep their jobs, why don't doctors and others volunteer to do the same even for just a period of time, until we get back to normal?If they are proud of our country, there is a way they can prove it.Would you buy a used car from a doctor?

[donniedarko]

How exactly are they going to make a payment per patient/procedure work, and still ensure it remains equitable for regional/remote people? It is just going to encourage centralisation due to economies of scale in a system that needs to be decentralised (at least for common procedures) to provide accessible care for all.

There would need to be either: 1) some sort of weighting for rural/remote facilities, or 2) the local area networks may need to encapsulate at least a 'big brother' with the smaller facilities to allow for sharing of funds generated.

But to be honest Boxy, they don't really know. Vic does not face these issues of the same magnitude as Qld/WA wrt rurality, so it still remains to be explained how the rural/remote folk don't get a cheap soggy biccie.