Reforming Health Care in Australia
In 2008, the Australian Government set up the National Health and Hospital Reform Commission (NHHRC) to conduct the most comprehensive review of Australia's health system in 20 years.
The current health care system was identified as being fragmented, contributing to cost-shifting between different levels of government, involved too much waste and resulted in long waiting times for patients.
In August 2011, the Australian Government, together with the States and Territories, signed the National Health Reform Agreement (NHRA). The reforms set out in this agreement will result in changes to the organisation, funding and delivery of our health care system.
The reforms have three primary objectives:
- Reforming the fundamentals of our health and hospital system, including funding and governance, to provide a sustainable foundation for providing better services now and in the future.
- Changing the way health services are delivered, through better access to high quality integrated care designed around the needs of patients, and a greater focus on prevention, early intervention and the provision of care outside of hospitals.
- Providing better care and better access to services for patients, through increased investments to provide better hospitals, improved infrastructure, and more doctors and nurses.
This marks a fundamental change in the way health care is funded and delivered throughout the nation, including the Northern Territory. The reforms are intended to make sure that the public health system is concerned with the needs of local communities, to maintain standards of safety and quality, and to ensure that there is transparency and sustainability in all funding.
Under the NHRA the Australian Government and states and territories will have a joint responsibility for funding public hospital services to meet the increasing demand in health services. The Australian Government will contribute half the efficient price of growth in public hospital services by 1 July 2017.
Activity Based Funding (ABF) will be the primary way the government provides funding for public hospital services. ABF will promote transparency and effectiveness in public hospitals as it will provide incentives for hospitals to treat more patients more effectively. The Australian Government's contribution to public hospitals funding will be based on the services actually provided by each hospital.
The efficient price and what hospital services will receive funding from the Australian Government will be determined by the Independent Hospital Pricing Authority (IHPA).