Western Australian report, December 2016

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In this report

This report includes the following tables:

This report is issued by the Administrator of the National Health Funding Pool under section 240 of the National Health Reform Act 2011.

This report is prepared on a cash basis. It shows monthly and year-to-date (YTD) National Health Reform (NHR) funding and payments for Western Australia for December 2016 as part of the National Health Reform Agreement.

Local hospital networks and National Health Reform

A local hospital network (LHN) is an organisation that provides public hospital services in accordance with the Agreement. An LHN can contain one or more hospitals, and is usually defined as a business group, geographical area or community. Every Australian public hospital is part of an LHN.

Note: The term ‘local hospital network’ is a national term. Some states and territories use their own terminology to describe these networks, such as local health districts, health organisations, and hospital and health services.

Under the Agreement, LHNs receive funding for the following public hospital services:

  • All admitted and non-admitted services
  • All emergency department services provided by a recognised emergency department
  • Other outpatient, mental health, sub-acute services and other services that could reasonably be considered a public hospital service.

Note: LHNs also receive funding from other sources, including the Commonwealth, states and territories, and third parties for the provision of other specific functions and services outside the scope of the Agreement, for example dental services, primary care, home and community care, residential aged care and pharmaceuticals. For further information on total funding to a particular LHN, contact the WA Department of Health to view the service agreement for that LHN.

Basis for National Health Reform payments – Western Australia, December 2016

For the basis of the Commonwealth contribution to NHR funding, see Basis of Commonwealth NHR funding, 2016-17.

The basis used to determine NHR payments to LHNs in Western Australia for December 2016 is as follows:

Service agreements between the Department of Health (the Department) and Health Service Providers (HSPs) are based on the Department’s funding and purchasing policies and resource allocation models.

The Western Australia Activity- Based Funding (WA ABF) model determines the price at which the Department purchases services from HSPs and the type and volume of services that are purchased. Metropolitan public hospitals and Regional and District rural hospitals are funded through the WA ABF model. The WA ABF model is based on the national ABF model however, it includes a range of modifications reflecting WA funding principles and purchasing mechanisms.

Small rural hospitals are funded through block funding arrangements which, although based on the National Efficient Cost Determination contain some funding modifications.

The vast majority of non-hospital services are block-funded. Block funding is based on budget to budget build from the previous year using WA State Government funding parameters consistent with the WA State budget.

Reference information

The financial information outlined in the following report is categorised as:

  • NHR funding – when the Commonwealth or state or territory government pays NHR funding into a state pool account or state managed fund.
  • NHR payments – when NHR funding that has been deposited into a state pool account or state managed fund is paid out of the state pool account by the Administrator, or is paid out of the state managed fund by the state or territory.

State pool account transactions

Table 1a – State pool account transactions – Western Australia, December 2016

This table shows funding paid into the Western Australian state pool account by the Commonwealth, Western Australia or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the WA Department of Health or the state pool accounts of other states/territories for December 2016.

NHR funding by source Paid into state pool account Paid out of state pool account
To Local hospital networks To State
Managed Fund
To state
health department
To state pool (other State) Total paid out
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
140,208,017 140,208,017 140,208,017
Commonwealth
Block funding
22,824,445 22,824,445 22,824,445
Commonwealth
Other funding
3,387,938 3,387,938 3,387,938
Total C'wealth
funding
166,420,400 140,208,017 22,824,445 3,387,938 166,420,400
WA
funding
335,245,277 335,245,277 0 0 335,245,277
Other state/territory funding 0 0 0 0
Total 501,665,677 475,453,294 22,824,445 3,387,938 0 501,665,677

See definitions and explanatory notes following table 1b.

Table 1b – State pool account transactions YTD – Western Australia, December 2016

Following on from table 1a, this table shows year-to-date (YTD) funding paid into the Western Australian state pool account by the Commonwealth, Western Australia or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the WA Department of Health or the state pool accounts of other states/territories as at December 2016.

NHR funding by source Paid into state
pool account
Paid out of state pool account
To Local hospital
networks
YTD
To State
Managed Fund
YTD
To state health
department
YTD
To state pool (other State)
YTD
Total paid out
YTD
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
909,690,491 909,690,491 909,690,491
Commonwealth
Block funding
136,946,668 136,946,668 136,946,668
Commonwealth
Other funding
20,327,629 20,327,629 20,327,629
Total C'wealth
funding
1,066,964,788 909,690,491 136,946,668 20,327,629 1,066,964,788
WA
funding
1,309,671,675 1,309,671,664 0 0 1,309,671,664
Other state/territory funding 0 0 0 0
Total 2,376,636,463 2,219,362,155 136,946,668 20,327,629 0 2,376,636,452

Commonwealth ABF funding represents Acute admitted, Non-admitted, Emergency department, Sub-acute, and Admitted mental health service categories, which are funded by the Commonwealth through the state pool account and subsequently paid to LHNs.

Commonwealth Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted categories, which are funded by the Commonwealth and paid to the state managed fund.

Commonwealth Other funding represents other amounts funded by the Commonwealth, transacted through the state pool account and subsequently paid to state or territory health departments. This currently represents the Commonwealth contribution to public health.

WA funding represents funding contributions paid by Western Australia into its own state pool account, and subsequently paid to LHNs within the state, to the Western Australian health department and/or to other state pool accounts.

Other state/territory funding represents contributions paid to Western Australia by other states and territories for cross-border activity.

Note: The grey shaded areas in these tables reflect cells that are not applicable for a particular 'paid out' column. For example, Commonwealth block funding is only paid to state managed funds and not to local hospital networks or state or territory health departments.

NHR funding and payments shown in these tables include GST where applicable.

For more information, see National Health Reform funding and payments.

State managed fund transactions

Table 2a – State managed fund transactions – Western Australia, December 2016

This table shows funding paid into the Western Australia state managed fund by the Commonwealth and Western Australia, and payments out of the state managed fund to LHNs and other provider organisations for December 2016.

NHR funding by source Paid into state managed fund Paid out of state managed fund
To local hospital networks To Other Total paid out
($) ($) ($) ($)
Commonwealth Block funding 22,824,445 22,824,445
State/territory Block funding 46,643,189 46,592,294
Total 69,467,634 69,328,273 88,466 69,416,738

See explanatory notes following table 2b.

Table 2b – State managed fund transactions YTD – Western Australia, December 2016

Following on from table 2a, this table shows year-to-date (YTD) funding paid into the Western Australian state managed fund by the Commonwealth and Western Australia, and YTD payments out of the state managed fund to LHNs and other provider organisations as at December 2016.

NHR funding by source Paid into state
managed fund
YTD
Paid out of state managed fund YTD
To local hospital
networks
YTD
To Other
YTD
Total paid out
YTD
($) ($) ($) ($)
Commonwealth Block funding 136,946,668 136,946,668
State/territory Block funding 315,192,467 314,887,095
Total 452,139,135 451,302,970 530,794 451,833,764

Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted categories.

Commonwealth Block funding represents Commonwealth block funding contributions paid into the state managed fund from the state pool account, and block payments out of the state managed fund to LHNs and other provider organisations.

State/territory Block funding represents Western Australian block funding contributions into the state managed fund, and block payments out of the state managed fund to LHNs and other provider organisations.

Note: The grey shaded areas in these tables reflect that these block payments cannot at this stage be identified by source of funding (state, territory or Commonwealth contribution).

NHR funding and payments shown in these tables include GST where applicable.

For more, see National Health Reform funding and payments.

NHR funding and payments by service category

Table 3 – NHR funding and payments by service category – Western Australia, December 2016

This table shows NHR funding and payments by service category on both a monthly and year-to-date (YTD) basis for Western Australia for December 2016. NHR funding and payments are separated into the following service categories – activity-based funding (ABF), block funding, and other funding.

Service category NHR
funding
NHR
payments
NHR
funding YTD
NHR
payments YTD
($) ($) ($) ($)
ABF
Acute admitted 292,125,797 292,125,797 1,336,930,912 1,336,930,912
Admitted mental health 18,236,983 18,236,983 109,562,462 109,562,462
Sub-acute 28,733,106 28,733,106 134,777,829 134,777,829
Emergency department 66,989,231 66,989,231 302,281,540 302,281,540
Non-admitted 69,368,178 69,368,178 335,809,412 335,809,412
Total ABF (Pool) 475,453,294 475,453,294 2,219,362,155 2,219,362,155
Block
Small rural hospitals 38,845,394 38,845,394 181,261,166 181,261,166
Teaching, training & research 11,424,593 11,424,593 155,358,759 155,358,759
Non-admitted mental health 19,197,646 19,146,751 115,519,210 115,213,839
Other non-admitted services 0 0 0 0
Total Block (SMF) 69,467,634 69,416,738 452,139,135 451,833,764
Other
Public health funding 3,387,938 3,387,938 20,327,629 20,327,629
Overdeposit 0 0 0 0
Cross-border 0 0 0 0
Interest 0 0 11 0
Total Other (Pool) 3,387,938 3,387,938 20,327,640 20,327,629
Grand Total 548,308,866 548,257,971 2,691,828,929 2,691,523,547

Total ABF (Pool) is an aggregate of both Commonwealth and state or territory NHR funding and payments for activity-based funding (ABF) which is transacted through the state pool account.

Total Block (SMF) is an aggregate of both Commonwealth and state or territory NHR funding and payments for block funding which is transacted through the state managed fund (SMF).

Total Other (Pool) represents other funding and payments transacted through the state pool account, including public health funding, overdeposits, cross-border funding and payments, and interest.

State and territory cross-border payments can either be:

  • Paid to the relevant state or territory's LHNs - included within ABF and/or block payments in the above table, or
  • Reimbursed to the relevant state or territory where the state or territory's LHNs are already being funded for the cost of treating cross-border patients - shown in the Cross-border row under Other in the above table.

NHR funding and payments shown in these tables include GST where applicable.

For more information, see National Health Reform funding and payments.

NHR contributions by local hospital network

Table 4a – NHR contributions by local hospital network – Western Australia, December 2016

This table shows NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Western Australia during December 2016.

NHR contributions to LHNs are separated into an activity-based funding (ABF) component and a block component.

Local hospital network (LHN) ABF component
(ex GST)
Block component
(ex GST)
Total NHR payment
(ex GST)
($) ($) ($)
Child and Adolescent Health Service 32,850,597 1,634,785 34,485,381
East Metropolitan Health Service 95,167,911 6,387,439 101,555,350
North Metropolitan Health Service 139,533,092 9,364,089 148,897,181
Notional LHN - Royal Street - WA 3,651,405 0 3,651,405
South Metropolitan Health Service 110,043,609 5,965,478 116,009,088
WA Country Health Service 94,206,680 45,976,482 140,183,162
Total 475,453,294 69,328,273 544,781,567

See explanatory notes below table 4b.

Table 4b – NHR contributions by local hospital network YTD – Western Australia, December 2016

This table shows YTD NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Western Australia as at December 2016.

NHR contributions to LHNs are separated into an activity-based funding (ABF) component and a block component.

Local hospital network ABF component YTD
(ex GST)
Block component YTD
(ex GST)
Total NHR payment YTD
(ex GST)
($) ($) ($)
Child and Adolescent Health Service 163,952,652 22,808,707 186,761,359
East Metropolitan Health Service 421,707,468 48,324,634 470,032,102
North Metropolitan Health Service 647,859,139 96,517,870 744,377,010
Notional LHN - Royal Street - WA 27,911,837 0 27,911,837
South Metropolitan Health Service 556,444,255 63,792,869 620,237,124
WA Country Health Service 401,486,803 219,858,890 621,345,693
Total 2,219,362,155 451,302,970 2,670,665,125

NHR contributions in this table are GST exclusive to enable comparability of NHR payments in each LHN report.

Note: This table excludes GST.
The majority of government funding to LHNs is not subject to GST. However in some cases hospital funding to non-government entities does attract GST, for example, denominational hospitals, privately and commercially owned health facilities, or any other non-government third party provider of health services or related supplies.

For more information, see National Health Reform funding and payments.

Estimated monthly, YTD and annual activity

States and territories provide service volume estimates at the start of each financial year, and if required, can continue to refine these estimates during the course of the year. These estimates form the basis of monthly reporting of service volumes until actual service numbers become available. These estimates are expressed as National Weighted Activity Units (NWAU).

States and territories provide estimated annual NWAU to the Administrator as a basis for determining the Commonwealth activity-based funding. Current month NWAU estimates accumulate through the year-to-date (YTD) NWAU, to be equal to the annual NWAU at the end of the financial year.

States and territories may also provide activity information relating to the delivery of other public hospital functions funded.

Table 5 – Estimated monthly, YTD and annual NWAU by local hospital network – Western Australia, December 2016

This table shows estimated state or territory hospital activity for activity-based funding services expressed as NWAU for December 2016, the associated cumulative year-to-date (YTD), and total estimated annual NWAU for each LHN in Western Australia.

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2016-17
Child and Adolescent Health Service 3,818 24,575 47,498
East Metropolitan Health Service 13,475 87,368 172,003
North Metropolitan Health Service 19,104 121,205 240,931
Notional LHN - Royal Street - WA 1,447 9,834 19,439
South Metropolitan Health Service 17,590 109,167 212,405
WA Country Health Service 9,195 58,700 115,379
Total 64,629 410,850 807,655

An NWAU is a measure of health service activity expressed as a common unit. It provides a way of comparing and valuing each public hospital service, whether they are admissions, emergency department presentations or outpatient episodes, by weighting them for their clinical complexity. The average hospital service is worth one NWAU - the most intensive and expensive activities are worth multiple NWAU, the simplest and least expensive are worth fractions of an NWAU.

Monthly NHR payments relate to the cash needs of public hospitals and do not necessarily reflect the volume of services to be delivered in the month.

For more information on the NWAU calculation, see Calculation of NWAU.