Tasmanian report, October 2016

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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 Tasmania for October 2016 as part of the National Health Reform Agreement.

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. An LHN 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 an LHN.

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, LHNs 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: LHNs 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 LHN, contact the Tasmanian Department of Health and Human Services to view the service agreement for that LHN.

Basis for National Health Reform payments – Tasmania, October 2016

For the basis of the Commonwealth contribution to NHR funding, see Basis of Commonwealth NHR funding, 2016-17.

The basis used to determine NHR payments to LHNs in Tasmania for October 2016 was advised by the Tasmanian Department of Health and Human Services to be as follows:

Tasmania has developed a funding model (2016-17 Tasmanian Funding Model) which will take a prospective orientation (i.e. it will produce the forward allocation based on the volumes of services to be funded that are determined in accordance with State planning processes). The ABF Model was used to develop an activity profile and block funded services allocation for the Tasmanian Health Service (THS) for 2016-17.

The funding arrangements and associated pricing focused on the four ABF work streams of:

  • acute admitted,
  • other admitted (include sub-acute admitted and mental health),
  • non-admitted (include sub-acute non-admitted and mental health), and
  • emergency department

Tasmanian pricing applied in the 2016-17 ABF Model varies from the NEP. In this regard, Tasmania has used the national average cost per work stream based on Round 17 National Health Cost Data Collection (NHCDC) data for 2012-13 indexed to 2016-17. The National Average Cost was considered the most appropriate (where available) as it provides a National benchmark and includes more of the costs of delivering care such as pharmaceutical benefits scheme and highly specialized drugs.

Therefore the 2016-17 Tasmanian ABF Model pricing is based on the following:

  • Overnight Acute Admitted Patients and Same day Admitted Patients- price per weighted separation (National Average Cost indexed),
  • Length of Stay Outliers - a per diem rate will be paid (based on the National Average Cost indexed),
  • ICU Cases - the proposed pricing model will be based on (State Average Cost indexed)
    • price per ICU hour, and
    • price per hour of mechanical ventilation.
  • Non Admitted Patients - price per service event (State Average Cost indexed).
  • Emergency Department Patients - price per UDG (Urgency Disposition Group) (National Average Cost indexed).

The Tasmanian ABF Model also allocates block grants to the THS covering services provided and activities undertaken that are not within the ABF work streams. This includes teaching, training and research, non ABF hospitals and other operational grants costs which are deemed out of scope for Commonwealth funding.

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 that has been 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.

State pool account transactions

Table 1a – State pool account transactions – Tasmania, October 2016

This table shows funding paid into the Tasmanian state pool account by the Commonwealth, Tasmania or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the Tasmanian Department of Health and Human Services or the state pool accounts of other states/territories for October 2016.

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
To state pool (other State) Total paid out
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
25,233,753 25,233,753 25,233,753
Commonwealth
Block funding
4,964,032 4,964,032 4,964,032
Commonwealth
Other funding
660,690 660,690 660,690
Total C'wealth
funding
30,858,475 25,233,753 4,964,032 660,690 30,858,475
TAS
funding
31,322,046 31,322,046 0 0 31,322,046
Other state/territory funding 0 0 0 0
Total 62,180,521 56,555,799 4,964,032 660,690 0 62,180,521

See definitions and explanatory notes following table 1b.

Table 1b – State pool account transactions YTD – Tasmania, October 2016

Following on from table 1a, this table shows year-to-date (YTD) funding paid into the Tasmanian state pool account by the Commonwealth, Tasmania or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the Tasmanian Department of Health and Human Services or the state pool accounts of other states/territories as at October 2016.

NHR funding by source Paid into state
pool account
Paid out of state pool account
To Local hospital
networks
YTD
To State
Managed Fund
YTD
To state health
department
YTD
To state pool (other State)
YTD
Total paid out
YTD
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
100,935,012 100,935,012 100,935,012
Commonwealth
Block funding
19,856,129 19,856,129 19,856,129
Commonwealth
Other funding
2,642,758 2,642,758 2,642,758
Total C'wealth
funding
123,433,899 100,935,012 19,856,129 2,642,758 123,433,899
TAS
funding
123,493,032 123,493,032 0 0 123,493,032
Other state/territory funding 0 0 0 0
Total 246,926,931 224,428,044 19,856,129 2,642,758 0 246,926,931

Commonwealth ABF funding represents Acute admitted, Non-admitted, Emergency department, Sub-acute, and Admitted mental health service categories, which are funded by the Commonwealth through the state pool account and subsequently paid to LHNs.

Commonwealth Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted 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.

TAS funding represents funding contributions paid by Tasmania into its own state pool account, and subsequently paid to LHNs within the state, to the Tasmanian health department and/or to other state pool accounts.

Other state/territory funding represents contributions paid to Tasmania by other states and territories for cross-border activity.

Note: The grey shaded areas in these tables reflect cells that are not applicable for a particular 'paid out' column. For example, Commonwealth block funding is only paid to state managed funds and not to 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 – Tasmania, October 2016

This table shows funding paid into the Tasmania state managed fund by the Commonwealth and Tasmania, and payments out of the state managed fund to LHNs and other provider organisations for October 2016.

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 4,964,032 4,964,032
State/territory Block funding 20,096,298 20,096,298
Total 25,060,330 25,060,330 0 25,060,330

See explanatory notes following table 2b.

Table 2b – State managed fund transactions YTD – Tasmania, October 2016

Following on from table 2a, this table shows year-to-date (YTD) funding paid into the Tasmanian state managed fund by the Commonwealth and Tasmania, and YTD payments out of the state managed fund to LHNs and other provider organisations as at October 2016.

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 19,856,129 19,856,129
State/territory Block funding 108,094,460 108,094,460
Total 127,950,588 127,950,588 0 127,950,588

Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted 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 LHNs 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 LHNs 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 – Tasmania, October 2016

This table shows NHR funding and payments by service category on both a monthly and year-to-date (YTD) basis for Tasmania for October 2016. 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 38,969,328 38,969,328 154,033,019 154,033,019
Admitted mental health 2,562,074 2,562,074 9,173,498 9,173,498
Sub-acute 2,509,065 2,509,065 10,081,469 10,081,469
Emergency department 6,166,538 6,166,538 24,937,161 24,937,161
Non-admitted 6,348,794 6,348,794 26,202,897 26,202,897
Total ABF (Pool) 56,555,799 56,555,799 224,428,044 224,428,044
Block
Small rural hospitals 3,998,715 3,998,715 17,815,358 17,815,358
Teaching, training & research 3,871,858 3,871,858 19,136,741 19,136,741
Non-admitted mental health 2,565,682 2,565,682 12,338,152 12,338,152
Other non-admitted services 14,624,076 14,624,076 78,660,338 78,660,338
Total Block (SMF) 25,060,330 25,060,330 127,950,588 127,950,588
Other
Public health funding 660,690 660,690 2,642,758 2,642,758
Overdeposit 0 0 0 0
Cross-border 0 0 0 0
Interest 0 0 0 0
Total Other (Pool) 660,690 660,690 2,642,758 2,642,758
Grand Total 82,276,819 82,276,819 355,021,391 355,021,391

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 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 LHNs - 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 LHNs are already being funded for the cost of treating cross-border patients - shown in the Cross-border row under Other in the above table.

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

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

NHR contributions by local hospital network

Table 4a – NHR contributions by local hospital network – Tasmania, October 2016

This table shows NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Tasmania during October 2016.

NHR contributions to 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 payment
(ex GST)
($) ($) ($)
Tasmanian Health Service 56,555,799 25,060,330 81,616,129
Total 56,555,799 25,060,330 81,616,129

See explanatory notes below table 4b.

Table 4b – NHR contributions by local hospital network YTD – Tasmania, October 2016

This table shows YTD NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Tasmania as at October 2016.

NHR contributions to LHNs are separated into an activity-based funding (ABF) component and a block component.

Local hospital network ABF component YTD
(ex GST)
Block component YTD
(ex GST)
Total NHR payment YTD
(ex GST)
($) ($) ($)
Tasmanian Health Service 224,428,044 127,950,588 352,378,632
Total 224,428,044 127,950,588 352,378,632

NHR contributions in this table are GST exclusive to enable comparability of NHR payments in each LHN report.

Note: This table excludes GST.
The majority of government funding to LHNs 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 activity

States and territories provide service volume 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.

States and territories may also provide activity information relating to the delivery of other public hospital functions funded.

Table 5 – Estimated monthly, YTD and annual NWAU by local hospital network – Tasmania, October 2016

This table shows estimated state or territory hospital activity for activity-based funding services expressed as NWAU for October 2016, the associated cumulative year-to-date (YTD), and total estimated annual NWAU for each LHN in Tasmania.

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2016-17
Tasmanian Health Service 11,651 45,937 133,303
Total 11,651 45,937 133,303

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.