Australian Capital Territory report, June 2013

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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 the Australian Capital Territory for June 2013 as part of the National Health Reform Agreement.

Participation in the National Health Funding Pool – ACT, June 2013

In signing the National Health Reform Agreement (the Agreement), it was the intention of all states and territories that they would have the necessary legislation in place to enable them to participate in the National Health Funding Pool from 1 July 2012.

However, not all states and territories had their legislation in place by that date. As part of the transition to National Health Reform funding, arrangements were put in place whereby those states and territories received equivalent funding directly from the Commonwealth Treasury, and made payments directly from departmental bank accounts to local hospital networks (LHNs). Although these transactions were not made through state pool accounts and state managed funds, they have been included in this report (and designated as ‘notional payments’ into and out of state pool accounts and state managed funds) to enable national comparability for month and year-to-date reporting periods.

The Australian Capital Territory has participated in the National Health Funding Pool since 1 March 2013.

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. A local hospital network 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 a local hospital network.

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, local hospital networks 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: Local hospital networks 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 local hospital network, contact the ACT Health Directorate to view the service agreement for that local hospital network.

Basis for National Health Reform payments – ACT, June 2013

For the basis of the Commonwealth contribution to NHR funding, see Basis of Commonwealth NHR funding, 2012-13.

The basis used to determine NHR payments to local hospital networks (LHNs) in the Australian Capital Territory for June 2013 was advised by the ACT Health Directorate to be as follows:

The annual funding allocation for the ACT in 2012-13 was based on budget neutral modelling. This modelling was based on the historic cost of providing services plus cost indexation. The activity to be funded through activity-based funding was projected on historic activity levels for public hospital services in the ACT, and derived through the application of the Independent Hospital Pricing Authority determination.

The payments made by the ACT Government and the Commonwealth Government in June 2013 through the ACT Local Hospital Network Directorate were net of third party revenue, and were paid on the basis of estimated ACT local hospital network activity for the month of June 2013.

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 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.
  • Notional NHR payments – funds paid into and out of departmental bank accounts to local hospital networks that would have been transacted through the state pool account and/or state managed fund had NHR funding arrangements been in place. Notional payments are included in 2012-13 reporting to enable national comparability for month and year-to-date reporting periods.

State pool account transactions

Table 1a – State pool account transactions – ACT, June 2013

This table shows funding paid into the ACT state pool account by the Commonwealth and the Australian Capital Territory, and payments out of the state pool account to local hospital networks, the state managed fund, and the ACT Health Directorate for June 2013.

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
Total paid out
($) ($) ($) ($) ($)
Commonwealth
ABF funding
18,095,092 18,095,092 18,095,092
Commonwealth
Block funding
2,155,232 2,155,232 2,155,232
Commonwealth
Other funding
395,649 395,649 395,649
Total C'wealth
funding
20,645,972 18,095,092 2,155,232 395,649 20,645,972
Total state/territory
funding
18,104,000 18,104,000 0 18,104,000
Grand Total 38,749,972 36,199,092 2,155,232 395,649 38,749,972

See definitions and explanatory notes following table 1b.

Table 1b – State pool account transactions YTD – ACT, June 2013

Following on from table 1a, this table shows year-to-date (YTD) funding paid into the ACT state pool account by the Commonwealth and the Australian Capital Territory, and YTD payments out of the state pool account to local hospital networks, the state managed fund, and the ACT Health Directorate as at June 2013. These amounts include notional payments for July 2012 to February 2013 inclusive.

NHR funding by source Paid into state
pool account
YTD
Paid out of state pool account YTD
To local hospital
networks
YTD
To state
managed fund
YTD
To state health
department
YTD
Total paid out
YTD
($) ($) ($) ($) ($)
Commonwealth
ABF funding
226,866,226 226,866,226 226,866,226
Commonwealth
Block funding
16,704,541 16,704,541 16,704,541
Commonwealth
Other funding
4,706,178 4,706,178 4,706,178
Total C'wealth
funding
248,276,945 226,866,226 16,704,541 4,706,178 248,276,945
Total state/territory
funding
350,053,862 350,053,862 0 350,053,862
Grand Total 598,330,807 576,920,088 16,704,541 4,706,178 598,330,807

Note:Of the total year-to-date amount of $598,330,807 shown in Table 1b as paid into and out of the ACT state pool account, $381,448,494 was notional year-to-date payments.
No payments were made from the ACT state pool account from July 2012 to February 2013 inclusive, with payments made directly from departmental bank accounts to local hospital networks.

Commonwealth ABF funding represents Acute admitted public, Acute admitted private, Non-admitted, and Emergency department service categories, which are funded by the Commonwealth through the state pool account and subsequently paid to local hospital networks.

Commonwealth Block funding represents Mental health, Small rural and metropolitan hospitals, Sub-acute, Teaching, training and research, and Other 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.

State/territory funding represents funding contributions paid by the Australian Capital Territory into its own state pool account, and subsequently paid to local hospital networks within the state and/or to state or territory health departments.

Note: The grey shaded areas in these tables reflect that these amounts are not applicable for a particular 'paid out' column. For example, Commonwealth block funding is only paid to state managed funds and is not applicable for 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 – ACT, June 2013

This table shows funding paid into the ACT state managed fund by the Commonwealth and the Australian Capital Territory, and payments out of the state managed fund to local hospital networks and other provider organisations for June 2013.

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 2,155,232 2,155,232
State/territory Block funding 2,228,300 2,228,300
Total 4,383,532 4,383,532 0 4,383,532

See explanatory notes following table 2b.

Table 2b – State managed fund transactions YTD – ACT, June 2013

Following on from table 2a, this table shows year-to-date (YTD) funding paid into the ACT state managed fund by the Commonwealth and the Australian Capital Territory, and YTD payments out of the state managed fund as at June 2013. These amounts include notional payments for July 2012 to February 2013 inclusive.

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 16,704,541 16,704,541
State/territory Block funding 43,288,506 43,288,506
Total 59,993,047 59,993,047 0 59,993,047

Block funding represents Mental health, Small rural and metropolitan hospitals, Sub-acute, Teaching, training and research, and Other 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 local hospital networks and other provider organisations.

State/territory Block funding represents ACT block funding contributions into the state managed fund, and block payments out of the state managed fund to local hospital networks 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 – ACT, June 2013

This table shows NHR funding and payments by service category on both a monthly and year-to-date (YTD) basis for the Australian Capital Territory for June 2013. 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 - public 27,149,319 27,149,319 432,690,066 432,690,066
Acute admitted - private 1,809,955 1,809,955 28,846,004 28,846,004
Non-admitted 3,257,918 3,257,918 51,922,808 51,922,808
Emergency department 3,981,900 3,981,900 63,461,210 63,461,210
Total ABF (Pool) 36,199,092 36,199,092 576,920,088 576,920,088
Block
Mental health 3,090,715 2,936,966 41,272,230 40,349,199
Small rural and metro hospitals 89,132 175,341 1,801,119 2,314,323
Sub-acute 0 0 0 0
Teaching, training and research 875,603 964,377 12,576,524 13,109,608
Other 328,082 306,847 4,343,174 4,219,917
Total Block (SMF) 4,383,532 4,383,532 59,993,047 59,993,047
Other
Public health funding 395,649 395,649 4,706,178 4,706,178
Overdeposit 0 0 0 0
Cross-border 0 0 0 0
Interest 0 0 0 0
Total Other (Pool) 395,649 395,649 4,706,178 4,706,178
Grand Total 40,978,272 40,978,272 641,619,313 641,619,313

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, which are 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 local hospital networks - 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 local hospital networks are already being funded for the cost of treating cross-border patients - shown in the Cross-border row under Other in the above table.

Cross-border funding arrangements between states and territories are yet to be put in place for state and territory contributions.

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

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

NHR payment distribution by local hospital network

Table 4 – NHR payment distribution by local hospital network – ACT, June 2013

This table shows NHR payments (from state, territory and Commonwealth sources) made to each local hospital network (LHN) in the Australian Capital Territory during June 2013.

NHR payments distributed to local hospital networks (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 payments
(ex GST)
($) ($) ($)
ACT Local Hospital Network Directorate 36,199,092 4,383,532 40,582,623
Total 36,199,092 4,383,532 40,582,623

A local hospital network (LHN) is an organisation that provides public hospital services in accordance with the National Health Reform Agreement. A local hospital network 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 a local hospital network.

NHR payments in this table are GST exclusive to enable comparability of NHR payments in each local hospital network report.

Note: This table excludes GST and payments to other provider organisations (non-local hospital networks).
The majority of government funding to local hospital networks 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 NWAU by local hospital network

States and territories provide NHR funding amounts and service volumes as service 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.

Table 5 – Estimated monthly, YTD and annual NWAU by local hospital network – ACT, June 2013

This table shows estimated state or territory hospital activity for activity-based funding services expressed as NWAU for June 2013, the associated cumulative year-to-date (YTD), and total estimated annual NWAU for each local hospital network in the Australian Capital Territory.

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2012-13
ACT Local Hospital Network Directorate 9,765 113,803 115,604
Total 9,765 113,803 115,604

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.