National Health Reform Briefing 7 June 2012

1. Jon Evans National Health Reform Briefing7 June 2012

2. Executive Summary National Reform proposals will be a ‘reality of sorts’ on July 1st 2012 with changes to pricing, funding, payments, performance targets, data collection and reporting. The new arrangements will be overseen by a number of new national agencies. The mandated July 1st requirements of these agencies is still being developed. The changes will impact on the nature of health service budgets, statement of priorities and reported performance indicators.

3. Independent Hospital Pricing Authority (IHPA) and the National Efficient Price (NEP) Legislation to establish the IHPA passed Commonwealth Parliament on 24 November 2011 The National Efficient Price (NEP) developed by IHPA will relate to the National Weighted Activity Unit (NWAU) and will inform the development of a nationally consistent activity based funding regime The NEP Determination will be based on the scope of public hospital services to be funded, block funding criteria, basis for price setting, adjustments to the price and pricing private patients in public hospitals The NEP has been released to Governments. The Commonwealth and States have 45 days to consider Acute admitted services, emergency department services and non-admitted patient services – ABF commences on 1 July 2012 Remaining non-admitted services, mental health and subacute services – ABF commences on 1 July 2013

4. National Funding Pool • Legislation to establish National Funding Pool has been introduced into Commonwealth Parliament and referred to Senate Finance and Public Administration Legislation Committee for investigation • States are yet to pass legislation to establish the National Funding Pool and Body - still due to start 1 July 2012 • Funding Pool Administrator is yet to be appointed. Position description is currently being drafted • Systems to support National Funding Pool are under development. Commonwealth yet to provide detailed specification documentation for funding and payment system

5. Scope of Public Hospital Services Under the NHRA, the scope of Public Hospital Services eligible for Commonwealth funding includes: All admitted programs, including hospital in the home programs All emergency department services provided by recognised emergency department services Non admitted services (independent of setting) In late 2011, IHPA engaged HealthConsult to develop a comprehensive list of services delivered in non admitted settings that would aid the IHPA in developing the general list. IHPA has established a refined set of criteria and a draft general list of services considered to public hospital services. The list has been included in the National Efficient Price Determination.

6. Scope of Public Hospital Services IHPA has proposed that non-admitted services must meet the definition of a Service Event - An interaction between one or more healthcare provider(s) with one non-admitted patient, which must contain therapeutic/clinical content and result in a dated entry in the patient’s medical record Two broad categories of in-scope, public hospital non-admitted services: Specialist outpatient services Other non-admitted services