The basis used to determine NHR payments to LHNs in Western Australia is as follows:

The 2012-13 annual funding allocations for Western Australia have been developed using the Western Australian Activity-Based Funding (ABF) program methodology. Activity profiles have been developed consistent with the WA Health clinical services framework. The funding allocations include activity based services, block funded services and specified programs. The national Activity-Based Funding classifications and associated price weights including all of the loadings (specialised paediatric, rural/remote, indigenous, intensive care unit (ICU) and private patient) have been used to define Activity-Based Funding profiles. State specific loadings have been applied to adjust for peer relativities in the metropolitan area and for rural and remote sites. Block Funding is based on budget to budget build from the previous year using State Government funding parameters consistent with the State budget.

Monthly allocations to Local Hospital Networks will vary for a variety of reasons, for example, allowance for annual insurance premiums, or variation in number of staff pay days in a month.