The basis used to determine NHR payments to LHNs in Queensland was advised by the Queensland Department of Health to be as follows:
In determining the annual funding allocation for hospital and health services in Queensland, the budget has been based on the Queensland Activity-Based Funding (ABF) model adjusted for agreed transition paths. Activity levels are based on purchased levels in 2011-12 and increased where an assessment of health need demonstrates that additional activity should be purchased, and it is within available funding. With regards to services not covered by Activity-Based Funding, Block Funding has been provided based on funding levels received in 2011-12 increased for Enterprise Bargaining agreements and non-labour escalation. In addition, efficiency requirements have been levied on all hospital and health services to ensure improved productivity and a closer alignment between costs incurred and the National Efficient Price.
On a monthly basis, the System Manager makes payments to the Hospital and Health Services as related funding is received. The funding received is from a variety of sources with variable timing of receipt. As such there is variability in relation to the amount paid to Hospital and Health Services on a monthly basis. The major factor relating to payment variability is the timing of State appropriation payments.
Interest received in the pool account from Reserve Bank of Australia is returned to Treasury's consolidated account and is not used for NHR funding.
Between February and June 2014, the Commonwealth provided Queensland with additional public hospital funding of $41,461,823.22 under the funding measure: National Partnership on public hospital system - additional funding. This funding was provided to offset the downward adjustments to 2013-14 NHR funding applied at the 2013-14 Mid-Year Economic and Fiscal Outlook (MYEFO) and the 2014-15 Budget, due to the application of updated NHR funding indexation parameters. A requirement of the provision of this funding was that it is passed on in full through the National Health Funding Pool and/or State Managed Fund to LHNs for activity based and Block Funding, and State and Territory health departments for public health funding.