Tasmanian 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 Tasmania 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.

Tasmania has participated in the National Health Funding Pool since 1 July 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 Tasmanian 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 Tasmania for December 2012 was advised by Tasmania to be as follows:

In determining the annual allocation for the Tasmanian Health Organisations (THOs), budgets have been developed using state based historical funding amounts for both activity based funding (ABF) and block service streams, supplemented by indexation at a flat rate of 2.5% which approximates the level of indexation which would have been provided to the organisations in previous years based on:

  • Indexation on new wage agreements at 2.0% per annum
  • Indexation of general operating expenses at 2.5% per annum, and
  • Indexation on medical, surgical and pharmaceutical supplies at 4.0% per annum.

On a monthly basis, from October 2012, state activity based funding is currently based on 1/12 of the total funding provided to each organisation and block payments are currently based on the timing of expenditure in accordance with budget cash flows, for example, three pays in October/May and payment of an annual insurance premium in November. Adjustments to the State payment has occurred in October/November/December to predominantly reflect an increase in the total funding provided to each organisation under the service agreements.

Block funding – Mental health payment discrepancy

Tasmania have identified that the payment relating to block funding – Mental health, transacted via the state managed fund, was provided to a service provider who is not one of the identified Tasmanian local hospital networks, ie. Tasmanian Health Organisation – North West, North or South. Therefore payments relating to block funding – Mental health for September 2012 will not align in Report 1 and 2 (National and state level) and Report 3 (local hospital network level).

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.

Transactions on the state pool account

This table shows funding paid into the Tasmanian state pool account by the Commonwealth and Tasmania, 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 – Tasmania, 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
19,164,320 19,164,320 19,164,320
Commonwealth
Block funding
4,263,944 4,263,944 4,263,944
Commonwealth
Other funding
563,953 563,953 563,953
Total Commonwealth
funding
23,992,218 19,164,320 4,263,944 563,953 23,992,218
Total state/territory
funding
20,232,390 20,232,360 0 20,232,360
Grand Total 44,224,608 39,396,680 4,263,944 563,953 44,224,578

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 Tasmanian state pool account by the Commonwealth and Tasmania, 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.

Table 1b – State pool account transactions YTD – Tasmania, 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
118,495,761 118,495,761 118,495,761
Commonwealth
Block funding
26,364,583 26,364,582 26,364,582
Commonwealth
Other funding
3,453,131 3,453,131 3,453,131
Total Commonwealth
funding
148,313,474 118,495,761 26,364,582 3,453,131 148,313,474
Total state/territory
funding
120,263,999 120,252,355 0 120,252,355
Grand Total 268,577,473 238,748,116 26,364,582 3,453,131 268,565,829

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 Tasmania 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 Tasmanian state managed fund by the Commonwealth and Tasmania and payments out of the state managed fund for December 2012.

Table 2a – State managed fund transactions – Tasmania, 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 4,263,944 4,263,944
State/territory Block funding 12,417,963 12,435,377
Total 16,681,907 15,540,896 1,158,425 16,699,321

See explanatory notes following table 2b.

Following on from table 2a, this table shows the year-to-date (YTD) funding paid into the Tasmanian state managed fund by the Commonwealth and Tasmania and payments out of the state managed fund as at December 2012.

Table 2b – State managed fund transactions YTD – Tasmania, 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 26,364,582 26,364,582
State/territory Block funding 120,817,965 120,810,999
Total 147,182,547 140,127,513 7,048,068 147,175,582

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 Tasmanian 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 Tasmania 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 – Tasmania, December 2012

Service category NHR funding NHR payments NHR funding
YTD
NHR payments
YTD
($) ($) ($) ($)
ABF
Acute admitted - public 28,670,766 28,670,766 176,184,750 176,184,750
Acute admitted - private 2,801,082 2,801,082 17,153,893 17,153,893
Non-admitted 3,217,329 3,217,329 19,368,766 19,368,766
Emergency department 4,707,503 4,707,503 26,040,707 26,040,707
Total ABF (Pool) 39,396,680 39,396,680 238,748,116 238,748,116
Block
Mental health 1,077,700 1,158,425 6,663,576 7,048,068
Small rural & metro hospitals 4,720,875 4,656,018 48,518,883 48,135,607
Sub-acute 2,376,608 2,376,893 19,053,941 19,052,587
Teaching, training & research 990,243 990,350 5,543,112 5,542,177
Other 7,516,480 7,517,634 67,403,035 67,397,143
Total Block (SMF) 16,681,907 16,699,321 147,182,547 147,175,582
Other
Public health funding 563,953 563,953 3,453,131 3,453,131
Overdeposit 0 0 0 0
Cross border 0 0 0 0
Interest 30 0 11,643 0
Total Other (Pool) 563,984 563,953 3,464,774 3,453,131
Grand Total 56,642,571 56,659,955 389,395,438 389,376,829

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 Tasmania 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 – Tasmania, December 2012

Local hospital network (LHN) ABF component
(ex GST)
Block component
(ex GST)
Total NHR payments
(ex GST)
($) ($) ($)
Tasmanian Health Organisation - North 13,827,721 2,215,107 16,042,828
Tasmanian Health Organisation - South 20,823,844 10,346,124 31,169,968
Tasmanian Health Service 4,745,115 2,979,666 7,724,781
Total 39,396,680 15,540,896 54,937,576

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 Tasmania.

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 – Tasmania, December 2012

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2012-13
Tasmanian Health Organisation - North 3,057 19,310 37,209
Tasmanian Health Organisation - South 4,836 29,215 57,757
Tasmanian Health Service 1,115 7,360 14,002
Total 9,008 55,885 108,968

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.