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The National Health Reform Agreement has been under review. Why the secrecy?

The lack of transparency and accountability around the review of the National Health Reform Agreement raises many questions and concerns, according to health policy analyst Charles Maskell-Knight.


Charles Maskell-Knight writes:

The National Health Reform Agreement (NHRA) is one of the most important documents in the Australian health sector, setting out the terms of the public hospital funding deal between the Commonwealth and the states and territories. It provides for the calculation and allocation of around $26 billion annually in Commonwealth funding, and has a strong influence on the allocation by the states of a further $40 billion.

As I have written elsewhere, since 2000 First Ministers and Treasurers have encroached more and more on NHRA negotiations. It was thus welcome to see that the 2020 renegotiation of the NHRA included a provision (clause 21) for a mid-term review of the Agreement, to be completed by December 2023, and focused on health issues rather than fiscal ones.

The review was to “assess if the [agreement] is meeting its stated objectives and [to] consider the following matters:

  1. implementation of the long-term reforms and other governance and funding arrangements, and whether practice and policy in place delivers on the objectives of the [agreement];
  2. the impact of external factors on the demand for hospital services and the flow-on effects on [agreement] parameters;
  3. for small rural and small regional hospitals, whether they continue to meet the block funding criteria determined by the IHPA;
  4. whether any unintended consequences such as cost-shifting, perverse incentives or other inefficiencies that impact on patient outcomes have arisen, and the capacity of Parties to adopt and deliver innovative models, as a result of financial and other arrangements in this [agreement];
  5. the performance of the national bodies against their functions, roles and responsibilities;
  6. arrangements for approval and funding of high cost therapies offered in public hospitals…; and
  7. other matters as agreed by [Health Ministers] or COAG.

On 24 February this year Health Minister Mark Butler announced that a mid-term review of the NHRA would indeed be carried out and completed by the end of the year, with an interim report in August. So far, so good.

The cone of silence

Since then the Minister and his Department have said nothing about the conduct or progress of the review. Searching the public record throws up a few clues.

A search of Austender shows that Deloitte won a contract worth $735,000 to provide “analytical support services” to the review. It also shows two contracts for “management advisory services” worth a combined $845,000 for the two reviewers.

The communique for the July Health Ministers Meeting records that the reviewers (Ms Rosemary Huxtable AO and Mr Michael Walsh PSM) attended the meeting and advised Ministers of the “extensive consultation process for the review including 62 jurisdictional workshops, 35 targeted interviews, and 60 written submissions and case studies from jurisdictions and other organisations”.

Ministers also noted that given “Mr Walsh’s appointment as the acting Director-General of Queensland Health from July 2023, Ms Huxtable alone will finalise the report”.

The communique for the November Health Ministers Meeting blandly recounts that “Ministers discussed the progress of National Health Reform Agreement Mid-Term Review – Final Report and noted that it would be progressed to the next National Cabinet meeting for consideration”.

The discovery process

In an effort to find out a bit more about the review, I put a series of questions to the Department of Health and Aged Care.

Below are my questions, the Department’s answers, and my commentary.

Q: Was there a public call for submissions to the review? If so, when was it made? How many submissions were received? How many of these were from the Commonwealth or state and territory governments?

No, but there was a targeted invitation made to stakeholder groups. 65 submissions were received, 9 from the Commonwealth and state and territory governments.

I then asked a follow-up question: You said that there was “a targeted invitation made to stakeholder groups” to lodge a submission. Which organisations were approached? How (and by whom) were they selected?

The NHRA Mid-term Review consultation plan was approved by all Health Ministers and included a broad range of stakeholders, including consumer and clinician groups.

I responded, asking whether the department was accidentally or deliberately ignoring the first part of the question: which organisations were approached? So far I have not received a reply.

Two important issues flow from this.

The first is the decision not to have a general invitation for submissions. The Department of Health and Aged Care’s consultation hub shows public consultations on all sorts of topics from the very broad to the very specific.

At the very broad level, the Department is currently consulting on the National Nursing Workforce Strategy, seeking views on the current challenges affecting the nursing workforce in Australia and the opportunities for a way forward. At the other end of the spectrum, the Department prepared a Guide to assist applicants to prepare an application to list a product on the private health insurance prosthesis list – and then held a public consultation on the draft Guide.

I can’t see any reason for limiting submissions on the NHRA. It is certainly far more important to the health system as a whole than a guide to prostheses list applicants. Millions of Australians attend public hospitals every year, while perhaps several hundred people write applications for prosthesis list inclusion.

The second issue is the secrecy around who was invited to make a submission. Unless the public know who was asked, it is difficult to have any confidence that the review had access to the views of all appropriate groups.

Many of the organisations which received an invitation from the review of the NHRA published their submissions on their own websites: for example, the Australian College of Midwives, the AHHA, the AMA, the ANMF, the Australian Physiotherapy Association, the Grattan Institute, Inclusion Australia, the National Mental Health Commission, the National Rural Health Alliance, Palliative Care Australia, Public Pathology Australia, and the RACGP

There are obvious gaps in this list, including insurers and consumers. I contacted a number of groups and learned that either they had made a submission, but had not published it because it contained confidential information, or they had decided against making a submission due to resource constraints, but had attended a face-to-face consultation.

Publishing the list of invitees (assuming it was comprehensive) would ensure public confidence in the process. In the absence of information, people might conclude that submissions were not sought from groups with potentially inconvenient views.

Q: When was the interim report finalised? Has it been made public? If so, when and where, and if not, why not? Has it been considered by Health Ministers and/or National Cabinet? If so, when?

The review was not required to provide an interim report.

Now, it is true that the clauses in the NHRA dealing with the review do not specify that there will be an interim report. However, Minister Butler’s media release said “the reviewers will provide an interim report to all Health Ministers in August 2023”. And even if the Agreement did not “require” an interim report, it certainly didn’t preclude one.

What on earth is going on?

Presumably when the Minister’s media release was issued in February, the Commonwealth intended that there would be an interim report. That intention was subsequently dropped. Why?

Q: When was the final report completed? When will it be considered by National Cabinet? Will it be released? If so, when, and if not, why not?

The final report was provided on 24 October 2023. Questions regarding National Cabinet should be directed to the Department of the Prime Minister and Cabinet. As the review was commissioned by all Health Ministers, release is a matter for their joint decision. 

I then approached the media team at PMC and asked: When will the next National Cabinet meeting be? Will the mid-term review be on the agenda for that meeting?

The next National Cabinet will occur by the end of this year. Meeting outcomes will be available following the meeting on https://federation.gov.au/

I replied to PMC, inviting them to have another go at a response that actually answered my questions. So far I have not received a reply.

The PMC response raises the issue of pointless secrecy. Presumably all across the country staff in First Ministers’ departments are working away getting ready for a National Cabinet meeting on a particular date with a specific agenda. I am pretty sure, with less than four weeks before Christmas, somebody in PMC or PMO is not setting up a Doodle poll to determine the date of the meeting.

Why not confirm publicly the date of the meeting and whether a particular item (with no possible security or commercial implications) is on the agenda?

More important is the fact that public release of the review report is still apparently a matter for decision.

As I wrote earlier, the NHRA governs annual health expenditure of about $66 billion on a system that delivers services to millions of Australians. The review will presumably set out issues that will need to be addressed in the negotiation of new hospital funding arrangements to apply from 2025.

What possible reason could there be for not publishing it?

Q: According to Austender, Deloitte was awarded a contract worth $735,000 to provide “analytical support services” to assist the review. Has Deloitte completed a final report on its work? Will this be released? If so, when, and if not, why not?

Deloitte supported the reviewer to deliver the final report of the Mid-Term Review.

Again, an “answer” that has nothing to do with the question. However, it appears that the “support” provided by Deloitte (at a cost of about $100,000 a month for the life of the review) did not take written form. Who knows what Deloitte actually did.

Missing the memo

What does all this mean? Taxpayers have funded a review of a major intergovernmental agreement at a cost of at least $1.5 million.

There is no public information about who was consulted during the review, and apparently there was no requirement for the consultants who received $735,000 to support the review to deliver a report on their work.

The interim report foreshadowed when the review was announced was dropped along the way.

And there is no commitment to publishing the final report.

Attorney-General Mark Dreyfus KC recently told the Saturday Paper that “we’re a proud, open, vibrant democracy and we should only keep things secret when it’s needed to protect our national interests”.

He’s right. It’s a pity this principle has not been applied to the review of the NHRA.

• Charles MaskellKnight PSM was a senior public servant in the Commonwealth Department of Health for over 25 years before retiring in 2021


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