One of the most significant events on the 2018 health calendar is the negotiation of new public hospital funding arrangements between the Commonwealth and the States and Territories.
These multi-billion dollar agreements will play a major role in shaping our health system over the next five years. In particular, they will influence the progress of reform in some key areas, including the integration of care across hospital and community boundaries and a move away from fee-for-service towards funding mechanisms linked to quality and outcome measures.
In late 2017 the Australian Healthcare and Hospitals Association (AHHA) released a document to guide the negotiation process. Healthy People, Healthy Systems, Strategies for outcomes-focused and value-based healthcare: a Blueprint for a post-2020 National Health Agreement is broad and forward-thinking document which looks beyond the hospital sector to suggest some fundamental changes to the organisation, governance and funding of the health system.
In an exclusive piece for Croakey, Alison Verhoeven discusses key features of the Blueprint and outlines why the 2018 negotiations are an ideal opportunity to develop a broad reform agenda for the future of the health system.
Alison Verhoeven writes:
For a health system to meet the needs and expectations of Australians, our governments – at both Commonwealth and state and territory levels – need to show true leadership over the next 12 months.
During 2018, Health Ministers and First Ministers will negotiate and agree new public hospital funding arrangements. If we genuinely want to reorientate our healthcare system to focus on patient outcomes and value, which we do, these negotiations provide that opportunity.
This is an opportunity to design a healthcare system that will coordinate and integrate services around patients, meeting the outcomes that matter to them. This is an opportunity to ensure funding incentivises the best possible health outcomes being achieved in the most sustainable manner.
Providing healthcare to a population that is as diverse and geographically dispersed as ours is complex.
National stewardship for the entire health sector is needed: stewardship that provides a single source of truth when it comes to the funding of, and outcomes achieved by, all health services.
An independent national health authority distinct from Commonwealth, state and territory health departments reporting directly to the Council of Australian Governments (COAG) or the COAG Health Council would help take the politics and finger pointing out of health reform and allow for a nationally unified and regionally controlled health system.
While some might argue an independent national health authority would add more bureaucracy and complexity to our healthcare system, I would argue the new body will incorporate and amalgamate several already-existing bodies as well as reduce the duplicated and cross-purpose functions currently carried out by the Commonwealth, states and territories. An independent national health authority has the potential to actually reduce layers of bureaucracy.
Regional structures and data
Regional responsiveness is needed: governance structures and funding models that facilitate hospital, primary care and community sectors to determine the needs of the people in their community, and respond in a coordinated and integrated way.
Data collection and reporting must be transformed to drive intelligent system redesign: data and reporting that is real-time, linked across the health sector, accurately reflecting health outcomes, and being utilised to understand individual and population health needs.
Requiring all health service providers delivering government funded or reimbursed services to supply data on patient outcomes and other service provision dimensions will better inform system performance and help us move toward publicly available outcomes data that will empower patients to make informed choices about treatment options and providers.
The health workforce must exist to serve and meet population health needs. Nationally we must move beyond a focus on the quantity and distribution of the workforce as it currently exists. Traditional workforce models need to be proactively redefined around patient needs. Education, regulation and funding must be coordinated to develop a patient-centred workforce that works to their full scope of practice, with innovation facilitated in a safe, effective and sustainable manner.
A national health workforce reform strategy is required that goes beyond the supply and location of health practitioners and considers roles and responsibilities needed to achieve a health workforce that is flexible, competent, working to the top of their scope of practice, and actively participating in the design and delivery of health services.
Health funding reform
The mechanisms for funding health services must be recognised as a powerful lever for addressing quality in healthcare. Together we must move away from fee for service funding models that place the focus on throughput of patients, and towards those that incentivise sustained improvements in health outcomes.
Maintaining current Commonwealth funding levels for public hospitals, including the growth formula, will provide sustainable and appropriate support, but we need to be more innovative in our move toward value-based care. In the short term, trialling a mixed funding formula with a 25% component for achieved health outcomes relating to the top 4 chronic diseases is a start.
The Australian Healthcare and Hospitals Association has released a blueprint for achieving outcomes-focused and value-based healthcare. Its development was guided by Australian health leaders, clinicians and patient representatives across the hospital, primary care and community sectors.
Healthy people, healthy systems is a solid blueprint with a range of short, medium and long term recommendations to transform our healthcare system into a fit for purpose 21st century system that will meet the needs and expectations of Australians.
Health Ministers must be more ambitious than agreeing what public hospital funding arrangements will look like after 2020. The health sector is adamant it’s time we move our system toward value-based care and away from more of the same and tinkering around the edges.
This is our call to action to Ministers and Governments with clear and implementable actions.
Find out more at ahha.asn.au/Blueprint
Alison Verhoeven is Chief Executive of the Australian Healthcare and Hospitals Association