Restructuring of Queensland Health: a step in the right direction

For those wondering what is happening in the world of Queensland health reform, here (PDF alert) is a report from KPMG, outlining the planned restructure of Queensland Health. (This Courier-Mail report suggests, however, that the future of the reforms is uncertain in view of next month’s election, with the Opposition opposing the restructuring).

A brief excerpt from the report follows below and then there is an article in which health policy expert Dr David Briggs gives his assessment of the reforms, as “a step in the right direction”. He also calls for national and state efforts to boost health manager numbers and training.

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Summary of KPMG report

The report says the drivers for restructuring include:

• Recent high profile incidents within the corporate services area of the organisation (e payroll system and fraud problems), and broader concerns about the current organisation of Queensland Health.

• That a large centralised department is not consistent with the devolution policy underpinning the creation of Local Health and Hospital Networks.

• The roles in Queensland Health have become confused, with its head office both overseeing the total system and delivering services itself.

• As Queensland Health head office has grown, the senior executive finds it more difficult to attend thoroughly to all of its areas of responsibility. Understandably, priority is given to clinical services, and the same attention has not been given to corporate services.

• Concerns have been raised about the culture of Queensland Health, including a lack of trust and confidence: a reluctance of the head office to trust in the capability of local management, and conversely, a lack of confidence in the ability of head office to deliver on its core responsibilities.

Principles guiding the proposed restructuring include:

• The core responsibilities of the Department’s head office should be focused on overall system management consistent with the Westminster tradition of a “policy department”.

• The key means of managing the overall Queensland health system should be through Health Service Agreements between the Queensland Department of Health and the various service delivery agencies.

• In implementing the new structural arrangements, staff should not experience a reduction in their terms and conditions.

• Frontline services should be devolved to LHHNs unless there are demonstrable advantages in operating them on a statewide or regional basis, such as, clear economies of scale (more efficient, higher quality), or the need to standardise systems.

• Corporate functions that primarily serve hospitals and health services should be separated from the Health Department and be directed by LHHNs as “customers”.

• Clinical support services that are best organised on a statewide basis should be separated from the day-to-day operational control of the Queensland Department of Health head office, and be governed within the LHHN framework.

• A system of governance is essential to maintain connections between all the agencies involved in managing and delivering Queensland’s hospital and health services.

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Assessing Queensland’s proposed health reforms

Dr David Briggs writes:

Health reform traditionally means organisational restructure and, in the case of the Queensland reforms, the KPMG Final Report suggests that structural reform is a pre-requisite to cultural reform.  It also considers that the new structures and legislation underpin effective cultural reform.

However, changing the culture of organisations and people that have been embedded in a couple of decades of centralised top down control requires more than a change of structure. It is all about restoring trust and confidence as acknowledged in the Report. This is a long term continuous project that will require leadership, teamwork and different ways of managing.

The structural reform is consistent with that implemented in other State based and international health jurisdictions. It is based on greater clarification of roles and responsibilities and a separation of powers and responsibilities. This reform is a starting point only to the separation and transparency.

The Commonwealth health reforms currently being implemented with separate agencies particularly that concerned with determining ‘national efficient price’ should accelerate the separation of funder/purchaser/provider roles and create greater transparency to that experienced from the ‘crop of highly internalised central health systems’ that we all have experienced.

While this reform heads in the right direction, it needs to be regarded as a first step. A streamlined department means it will have to be more focussed. The extent of control or devolved role of health districts will depend on the focus and detail of the individual performance agreements and how effective this might be given the three organisational reporting systems to the Minister. While Boards will govern health districts and districts will be represented on the Board of the Health Corporate Services Authority, the arrangement seems to place the Minister in a difficult place when dealing with conflicting advice from three sources. So a central coordinating group or role would seem inevitable.

Another interesting issue with this structure and, other state based health systems is that although they have introduced Boards to govern, the Boards in the end are appointed and accountable to the Minister, continuing the traditional bureaucratic approach to managing health systems.

It stands in contrast to that adopted by the Commonwealth in the establishment of Medicare Locals as incorporated public companies. This is said to be a move to post bureaucratic institutional arrangements that is more flexible, providing horizontal rather than hierarchical structure and extending the participation of stakeholders and communities in the implementation and governance of public policy. Perhaps such a move at State level is a step too far but it does have cultural and organisational issues for organisations that are meant to work collaboratively.

Managers in the system are practised and skilled in reporting upwards and not down and out as will particularly be required in the health district governance and management. Many health managers and, not just those in Queensland come to management roles, often without specific management or health management qualifications and often with relatively narrow generalist or clinical qualifications and, importantly experience.

Managing health systems is about managing highly professionalised, people orientated organisations, operating in complex systems. This means managers, leaders and governors need to have a deep contextualised understanding (education, experience and continuous learning) of health systems.

There has been a chronic under-investment in developing health managers in Australia. There are many capable and dedicated health managers and health professionals in our health systems and, in my view, it is their personal and professional values that have provided the glue that has kept our health system at a relatively high operational level in a resource constrained sector.

The reality is that even good managers are often a convenience, an ‘empty signifier’ there to accept the blame for poorly implemented policy or for poor resources and infrastructure. So the current health managers will be experiencing another period of uncertainty and reform tiredness as they wait to find a new role. Equally, many of the more innovative and capable managers will be seeing the opportunity for new ways of doing things that these reforms promised to deliver.

The gene pool of Australian health managers is not large and, increasingly consists of those coming from clinical backgrounds. Many of these professions are also experiencing workforce shortages. So at the national and state level the development and education of health managers needs to become a priority. The SHAPE Declaration of 2008 describes the type of capabilities that these managers need developed.

In summary, the reforms tick my boxes in terms of providing scalable (local) organisations that will have potential to reengage with communities, be more responsive to population health needs and to achieve greater collaboration and perhaps innovation. The more devolved approach should allow greater focus on managing down and out if mangers skills are developed in this area.

It is a stage one reform and hopefully, after the initial changes it might move to greater focus on culture and transitional reform, that is, time to allow it to be effective and evolve.

• Dr David Briggs notes that these comments reflect his personal views and not necessarily that of organisations with which he has affiliated roles including:
Adjunct Associate Professor, Schools of Rural Medicine and Health, University of New England
Chair, New England Medicare Local
Editor Asia Pacific Journal of Health Management
President Society for Health Administration Programs in Education