Northern Territory report, December 2012

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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 Northern Territory for December 2012 as part of the National Health Reform Agreement.

Participation in the National Health Funding Pool

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 comparibility for month and year-to-date reporting periods.

The Northern Territory has participated in the National Health Funding Pool since 1 October 2012.

Local hospital networks and National Health Reform

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 Northern Territory Department of Health to view the service agreement for that local hospital network.

Basis for National Health Reform payments

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

The basis used to determine NHR payments to local hospital networks (LHNs) in the Northern Territory for December 2012 was advised by the Northern Territory to be as follows:

The annual funding allocation for the Top End and Central Australian Hospital Networks of Northern Territory has been determined on a historical basis for both the activity based funding (ABF) and block service streams, supplemented by a level of growth based on NT Government Wage and Consumer Price Index parameters. Projected activity increases are not budgeted for and both local hospital networks are required to meet demand increases from within existing resources as a cost containment strategy.

Variations to monthly payments to the Northern Territory local hospital networks (LHNs) are made based on cash requirements. Cash requirements are impacted by the Northern Territory Salary payment cycle and other monthly variations, such as contractual obligation payment cycles which the local hospital networks are engaged in. The local hospital networks in the Northern Territory have been in a transitional phase and payments during this period have varied based on costs held centrally being transitionally transferred over. The month of December 2012 was used as a transitional month to adjust the local hospital networks year-to-date balances and cash requirements with the aim of aligning cash requirements closer to activity levels now that the transitional arrangements are almost finalised.

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 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 the 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.

Transactions on the state pool account

This table shows funding paid into the Northern Territory state pool account by the Commonwealth and the Northern Territory, and payments out of the state pool account to local hospital networks, the state managed fund, and the state health department for December 2012.

Table 1a – State pool account transactions – Northern Territory, December 2012

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
7,760,087 7,760,087 7,760,087
Commonwealth
Block funding
3,661,637 3,661,637 3,661,637
Commonwealth
Other funding
288,999 288,999 288,999
Total Commonwealth
funding
11,710,722 7,760,087 3,661,637 288,999 11,710,722
Total state/territory
funding
50,175,870 50,174,570 0 50,174,570
Grand Total 61,886,592 57,934,657 3,661,637 288,999 61,885,292

See definitions and explanatory notes following table 1b.

Following on from table 1a, this table shows the year-to-date (YTD) funding paid into the Northern Territory state pool account by the Commonwealth and the Northern Territory, and payments out of the state pool account to local hospital networks, the state managed fund, and the state health department as at December 2012. These amounts include notional payments for July, August and September 2012.

Table 1b – State pool account transactions YTD – Northern Territory, December 2012

NHR funding by source Paid into state pool account YTD Paid out of state pool account YTD
To local hospital networks To state managed
fund
To state health department Total paid out
YTD
($) ($) ($) ($) ($)
Commonwealth
ABF funding
48,117,075 48,117,075 48,117,075
Commonwealth
Block funding
22,664,785 22,664,785 22,664,785
Commonwealth
Other funding
1,770,964 1,770,964 1,770,964
Total Commonwealth
funding
72,552,824 48,117,075 22,664,785 1,770,964 72,552,824
Total state/territory
funding
130,459,393 130,456,796 0 130,456,796
Grand Total 203,012,217 178,573,871 22,664,785 1,770,964 203,009,620

Note: Of the total year-to-date amount of $203,012,217 shown in Table 1b as paid into the Northern Territory state pool account, $86,735,104 was notional year-to-date payments.

Note: Of the total year-to-date amount of $203,009,620 shown in Table 1b as paid out of the Northern Territory state pool account, $86,735,104 was notional year-to-date payments.

No payments were made from the Northern Territory state pool account in July, August and September 2012, 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 in by the Northern Territory into its own state pool account, and subsequently paid to local hospital networks within the state or territory 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 on NHR funding and payments, see National Health Reform funding and payments.

Transactions on the state managed fund

This table shows funding paid into the Northern Territory state managed fund by the Commonwealth and the Northern Territory and payments out of the state managed fund for December 2012.

Table 2a – State managed fund transactions – Northern Territory, December 2012

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 3,661,637 3,661,637
State/territory Block funding 18,465,255 18,465,255
Total 22,126,892 22,126,892 0 22,126,892

See explanatory notes following table 2b.

Following on from table 2a, this table shows the year-to-date (YTD) funding paid into the Northern Territory state managed fund by the Commonwealth and the Northern Territory and payments out of the state managed fund as at December 2012. These amounts include notional payments for July, August and September 2012.

Table 2b – State managed fund transactions YTD – Northern Territory, December 2012

NHR funding by source Paid into state managed fund YTD Paid out of state managed fund YTD
To local hospital networks To Other Total paid out
YTD
($) ($) ($) ($)
Commonwealth Block funding 22,664,785 22,664,785
State/territory Block funding 104,253,792 104,253,792
Total 126,918,577 126,918,577 0 126,918,577

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 Northern Territory 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 information on NHR funding and payments, see National Health Reform funding and payments.

NHR funding and payments by service category

This table shows the NHR funding and payments by service category on both a monthly and year-to-date (YTD) basis for the Northern Territory for December 2012.

NHR funding and payments are separated into an activity based funding (ABF) component, block component, and other components.

Table 3 – NHR funding and payments by service category – Northern Territory, December 2012

Service category NHR funding NHR payments NHR funding
YTD
NHR payments
YTD
($) ($) ($) ($)
ABF
Acute admitted - public 45,771,977 45,771,977 141,256,747 141,256,747
Acute admitted - private 2,532,095 2,532,095 7,714,776 7,714,776
Non-admitted 1,777,828 1,777,828 5,490,200 5,490,200
Emergency department 7,852,757 7,852,757 24,112,147 24,112,147
Total ABF (Pool) 57,934,657 57,934,657 178,573,871 178,573,871
Block
Mental health 1,058,118 1,058,118 8,334,608 8,334,608
Small rural & metro hospitals 2,308,331 2,308,331 14,858,539 14,858,539
Sub-acute 1,954,006 1,954,006 13,425,280 13,425,280
Teaching, training & research 1,158,489 1,158,489 8,086,691 8,086,691
Other 15,647,947 15,647,947 82,213,460 82,213,460
Total Block (SMF) 22,126,892 22,126,892 126,918,577 126,918,577
Other
Public health funding 288,999 288,999 1,770,964 1,770,964
Overdeposit 0 0 0 0
Cross border 0 0 0 0
Interest 1,300 0 2,597 0
Total Other (Pool) 290,299 288,999 1,773,561 1,770,964
Grand Total 80,351,848 80,350,548 307,266,010 307,263,413

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 payment 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 on NHR funding and payments, see National Health Reform funding and payments.

NHR payment distribution by LHN

This table shows NHR payments (from state, territory and Commonwealth sources) made to each local hospital network (LHN) in the Northern Territory during December 2012.

NHR payments are separated into an activity based funding (ABF) component and a block component.

Table 4 – NHR payment distribution by LHN – Northern Territory, December 2012

Local hospital network (LHN) ABF component
(ex GST)
Block component
(ex GST)
Total NHR payments
(ex GST)
($) ($) ($)
Central Australia Health Service 18,823,340 2,379,280 21,202,620
Top End Health Service 39,111,317 19,747,612 58,858,929
Total 57,934,657 22,126,892 80,061,549

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 to each local hospital network within the jurisdiction and allow for reconciliation against the Table 1a for each local hospital network report.

Note: 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 on NHR funding and payments, see National Health Reform funding and payments.

Estimated monthly, YTD and annual NWAU by LHN

This table shows estimated state or territory hospital activity for activity based funding services expressed as National Weighted Activity Units (NWAU) for December 2012, the associated cumulative year-to-date (YTD) and total annual estimated NWAU for each local hospital network in the Northern Territory.

NHR funding amounts and service volumes are provided by states and territories as service estimates at the start of each financial year, and may continue to be refined during the course of the year. These estimates form the basis of monthly reporting of service volumes until actual service numbers become available.

The estimated annual NWAU for each local hospital network (LHN) was provided to the Administrator as a basis for determining the Commonwealth NHR activity based funding. Current month NWAU estimates accumulate through the year-to-date NWAU to equal the annual NWAU at the end of the financial year.

Table 5 – Estimated monthly, YTD and annual NWAU by LHN – Northern Territory, December 2012

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2012-13
Central Australia Health Service 800 24,155 35,838
Top End Health Service 750 37,047 57,357
Total 1,550 61,202 93,194

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 NHR funding and payments, see National Health Reform funding and payments.

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