2014-15 Administrator National Health Funding Pool Annual Report

FURTHER INFORMATION

If you require further information or have any queries in relation to this Annual Report, please contact:

The Administrator, National Health Funding Pool
GPO Box 1252
Canberra ACT 2601
Phone 1300 930 522
Media 02 6289 7425
Email nhfa.administrator@nhfa.gov.au

An accessible copy of this Annual Report is available online at:
www.publichospitalfunding.gov.au/publications/annual-reports

LETTER OF TRANSMITTAL

NHFB logo

Office of the Administrator

GPO Box 1252 Canberra ACT 2601

Telephone: 1300 930 522

Email: nhfa.administrator@nhfa.gov.au

28 October 2015

The Hon. Sussan Ley MP
Minister for Health
Commonwealth of Australia

The Hon. Jill Hennessy
Minister for Health
Victoria

The Hon. Kim Hames MLA
Minister for Health
Western Australia

The Hon. Michael Ferguson MP
Minister for Health
Tasmania

The Hon. John Elferink MLA
Minister for Health
Northern Territory

The Hon. Jillian Skinner MP
Minister for Health
New South Wales

The Hon. Cameron Dick MP
Minister for Health
Queensland

The Hon. Jack Snelling MP
Minister for Health
South Australia

The Hon. Simon Corbell MLA
Minister for Health
Australian Capital Territory

Dear Ministers,

Administrator of the National Health Funding Pool Annual Report 2014–15

I am pleased to submit to you, for tabling in your respective Parliaments, my Annual Report for the year ended 30 June 2015.

This report has been prepared in accordance with the requirements of sections 241 to 243 of the Commonwealth National Health Reform Act 2011 (the Act) and corresponding state and territory national health reform legislation.

The report includes a combined Financial Statement of the National Health Funding Pool accounts, and a Financial Statement for each state and territory State Pool Account audited by the respective Auditor-General. The report also includes the reporting required under section 241(2) of the Act on national health reform funding and payments, on a national level and for each state and teritory.

Yours sincerely,

Acting Administrator’s signature

Kim Snowball
Acting Administrator
National Health Funding Pool

NATIONAL HEALTH REFORM FUNDING 2014–15

National Health Reform Funding 2014–15 Infographic: funding per state, by contribution source (state or Commonwealth); total number of hospital services funded

Totals may not equal the sum of components due to rounding.

National Health Reform Funding 2014–15 Infographic: components of Commonwealth funding (activity-based, block, and public health funding); total funding by type (activity based, state and territory, Commonwealth, block); total funding to local hospital networks

Totals may not equal the sum of components due to rounding.

MESSAGE FROM THE ADMINISTRATOR

As the Acting Administrator of the National Health Funding Pool (Administrator) I am pleased to present the Annual Report for the year ended 30 June 2015. This annual report covers the third year of operation of the National Health Funding Pool (the Funding Pool) and the role of Administrator.

For 2014–15 a total of $38.2 billion was paid to local hospital networks for services, an increase of $1.8 billion from the 2013–14 payment of $36.4 billion. This annual report covers the first growth year after a two-year transition period, in which the Commonwealth provided funding to the states and territories, equivalent to the amount that would otherwise have been paid under the former National Healthcare Specific Purpose Payment. This new method of funding hospitals now involves a nationally consistent measure of hospital activity with the Commonwealth consistently funding 45% of hospital growth in all states and territories. This ensures transparency on what hospital activity is delivered for the funding provided.

With the move to growth funding in 2014–15, the data requirements in the Administrator’s Three Year Data Plan 2014–15 to 2016–17 have supported the supply of patient and aggregate level data to ensure the accurate calculation of the Commonwealth’s funding contribution. The supply of data from the states and territories has enabled the production of monthly public reporting on funding and payment flows.

Data matching activities continued to be a focus for the Administrator and the NHFB in 2014–15. Considerable effort was undertaken with states, territories and the Commonwealth to strengthen the process. This cooperative undertaking of data custodians has enabled acute and primary care data to be examined, to improve financial administrative compliance.

As required by section 241(3) of the National Health Reform Act 2011 (the Act), this Annual Report includes a financial statement for each state and territory State Pool Account (audited by the respective Auditor-General), and a financial statement for the combined State Pool Accounts. Also included for each state and territory is a set of tables satisfying the reporting requirements of section 241(2) of the Act. These tables provide detail of funding and payments for each state and territory State Pool Account and state managed fund.

The Administrator’s role requires collaboration with states, territories, the Commonwealth, and other national health agencies. The work of the Administrator and the National Health Funding Body (NHFB) in 2014–15 has strengthened the effectiveness of this collaboration.

Mr Bob Sendt, the inaugural Administrator, retired on 1 August 2015. This Annual Report is a clear demonstration of his commitment in delivering independence and transparency in the calculation, payment and reporting of public hospital funding in Australia.

The Administrator, supported by the NHFB, is responsible for overseeing Commonwealth and state funding and payments, contributing to the sustainability of funding for public hospitals. From 2012–13 Mr Sendt worked collaboratively with the states and territories and the Commonwealth in the collection of data to support the objectives of comparability. He ensured that the data were shared between the relevant participants in the national health care arrangements to promote transparency.

I would like to acknowledge the work of the NHFB who assisted the Administrator to satisfy all financial reporting, payment and publishing milestones in 2014–15. This small team of dedicated professionals are to be commended.

I look forward to continuing the valuable work of the Administrator, particularly exploring the opportunities to provide states, territories and the Commonwealth with information and advice that assists in services planning and policy development.

Image of Kim Snowball, the Acting Administrator of the National Health Funding Pool

Kim Snowball
Acting Administrator
National Health Funding Pool

Health Productivity and Performance Commission

In the 2014–15 Budget, the Commonwealth Government announced an intention to consult with states and territories with a view to establishing a new Health Productivity and Performance Commission. The government has subsequently made a decision to not proceed with the establishment of a Health Productivity and Performance Commission. The Administrator and the NHFB will continue to administer and reconcile payments to public hospitals under the National Health Reform Agreement for the 2015–16 and 2016–17 financial years.

ANNUAL REPORTING: LEGISLATIVE REQUIREMENTS

The Administrator is required to prepare an Annual Report of operations and present it to Commonwealth and state/territory Health Ministers.

The information included in this Annual Report includes the mandatory reporting of:

  1. An individual financial statement for each state and territory’s State Pool Account and a combined financial statement.
  2. National health reform funding and payments.

This reporting is on both a national level and for each state and territory, reflecting all national health reform amounts transacted in 2014–15.

State and territory financial statements are audited and certified by the relevant Auditor-General.

Both of these financial reporting components have been compiled on a cash basis and are in Australian dollars. All amounts are rounded to the nearest thousand dollars unless otherwise specified.

This reporting is pursuant to the following jurisdictional national health reform legislation:

Table 1 Jurisdictional national health reform legislation

JURISDICTION FINANCIAL STATEMENTS NATIONAL HEALTH REFORM
FUNDING AND PAYMENTS
REPORTING
COMMONWEALTH s.241(3), s.242 and s.243 of the National Health Reform Act 2011 s.241(2) of the National Health Reform Act 2011
NEW
SOUTH
WALES
schedule 6A clauses 16(3), 17 and 18 of the Health Services Act 1997 schedule 6A clause 16(2) of the Health Services Act 1997
VICTORIA1 s.17(3), s.18 and s.19 of the Health (Commonwealth State Funding Arrangements) Act 2012 s.17(2) of the Health (Commonwealth State Funding Arrangements) Act 2012
QUEENSLAND s.53S(3), s.53T and s.53U of the Hospital and Health Boards Act 2011 s.53S(2) of the Hospital and Health Boards Act 2011
SOUTH
AUSTRALIA
s.22(3), s.23 and s.24 of the National Health Funding Pool Administration (South Australia) Act 2012 s.22(2) of the National Health Funding Pool Administration (South Australia) Act 2012
WESTERN
AUSTRALIA
s.19(3), s.20 and s.21 of the National Health Funding Pool Act 2012 s.9(2) of the National Health Funding Pool Act 2012
TASMANIA s.18(3), s.19 and s.20 of the National Health Funding Administration Act 2012 s.18(2) of the National Health Funding Administration Act 2012
AUSTRALIAN
CAPITAL
TERRITORY
s.18(2) of the National Health Funding Pool and Administration (National Uniform Legislation) Act 2012 s.5(2) of the Health (National Health Funding Pool and Administration) Act 2013
NORTHERN
TERRITORY
s.18(3), s.19 and s.20 of the National Health Funding Pool and Administration (National Uniform Legislation) Act 2012 s.18(2) of the National Health Funding Pool and Administration (National Uniform Legislation) Act 2012

1 Note that although this Act requires the Administrator to prepare a report, as at 30 June 2015 Victoria had not appointed an Administrator.