The basis used to determine NHR payments to LHNs in Victoria was advised by the Victorian Department of Health and Human Services to be as follows:

Payments in Victoria are based upon "Statement of Priorities" agreements between Victorian public health services (LHNs) and the Minister for Health (or Secretary). These annual agreements detail the service profile, strategic priorities and deliverables the Local Hospital Network will achieve in the year ahead; list the key financial, access and service performance priorities and agreed targets; and list funding estimates and associated service activity.

Funding details are aggregated into ABF funded services (including NWAU equivalent service volume), Block funded services and other funding for the purpose of determining payments to and from the State Pool Account and the State Managed Fund.

Victoria makes 13 payments per annum to funded agencies. Adjustments to the payments are made for cash flow needs and costs administered by the Victorian Department of Health on behalf of LHNs.

While the basis of NHR payments are reported on a cash basis by the Administrator, LHNs generally report revenue and expenditure on an accrual basis.