To meet the reporting requirements of Section 240 of the National Health Reform Act 2011, the Administrator is to include the basis of each State and Territory’s National Health Reform (NHR) funding and payments.
The State contribution to the funding of public hospital services and functions is calculated on an activity basis or provided as block funding in accordance with the National Health Reform Agreement – Addendum 2020-25. The State determines the amount they pay for public hospital services and functions and the mix of those services and functions and will meet the balance of the cost of delivering public hospital services and functions over and above the Commonwealth contribution.
State funding paid on an activity basis for each service category is based on the price set by that State (which is reported in the Service Agreement) and the volume of weighted services as set out in the Service Agreement.
To provide consistency in methodology and with the Addendum to National Health Reform Agreement 2020-25, the 2024-25 South Australia Funding Model has implemented the National Efficient Price (NEP24) and National Weighted Activity Unit (NWAU24) as the currency for Activity Based Funding (ABF) facilities.
The National Efficient Cost (NEC24) Block funding model is used for the small rural hospitals, specialist mental health services (non-admitted), child and adolescent mental health services, non‑admitted home ventilation, other services deemed in scope and teaching, training and research provided in the public hospitals. The State also provides an overlay of supplementary grants for services provided and activities undertaken that are not within scope of the NHR, for example, alcohol and drug services, dental services, child health and parenting services, primary care, home and community care.
The State determines when payments are made into the Pool and State managed fund. Payments are made from the Pool account to the Local Hospital Networks (LHNs) and the State managed fund in accordance with the Service Agreements agreed between the LHN and the Chief Executive of the South Australia Department for Health and Wellbeing.
The Chief Executive of the South Australia Department for Health and Wellbeing can agree to amendments of the Service Agreements with LHNs to adjust service volumes or pricing to take account of such matters as changing health needs, variations in actual service delivery and hospital performance.
The Service Agreements are available at www.sahealth.sa.gov.au/wps/wcm/connect/Public+Content/SA+Health+Interne…(Opens in a new tab/window).
Further information regarding the Basis for National Health Reform payments in both 2024-25 and previous financial years is included at www.publichospitalfunding.gov.au.