New agency to scrutinise hospital services

Public encouraged to comment on activity-based funding framework.

A new federal government agency has released a framework for defining which public hospital services may be funded under national health reforms.

Labor last year passed laws to set up the Independent Hospital Pricing Authority (IHPA), which will oversee the adoption of activity-based funding of hospital care.

The activity-based funding model is a key element in the government's health reform deal with the states and territories.

But the first task will be deciding what a public hospital service is.

"Unfortunately, this task is not as simple as funding everything that a public hospital provides," said a summary of the framework.

"Many public hospitals provide some services, such as aged-care services, that are not public hospital services."

All care provided to inpatients and people treated in emergency departments in public hospitals will be eligible for funding under the health reform agreement.

But the IHPA will have to decide on the status of other services, including outpatient clinics, mental health services, rehabilitation services and community programs to help people manage chronic diseases.

The agency also notes that funding of public hospital services will need to keep changing in future, in step with changes in how those services are delivered.

"That is why the national health reform agreement provides a guarantee that if services move outside hospitals in response to changes in clinical practice, these services will still be funded as if they were provided in hospitals," the summary said

"To do otherwise when funding is based on activity could establish incentives to admit more patients, rather than treat them in the community when it is safe to do so."

The authority must also determine which public hospital services will be funded through block grants on an activity basis and work out how to deal with private patients in public hospitals.

The public can comment on the framework until Tuesday, February 21.

AAP

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