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Future proofing medical education: challenges and opportunities in financing reform

In an era of reviews, reports and reforms, funding for medical education is set to undergo a substantial reconfiguration. As with any restructure, this presents both challenges and opportunities. This is well illustrated by three active consultations, the outcomes of which will profoundly influence the ongoing resourcing of clinical training.The first of these is the Higher Education Base Funding Review. The report recently handed down by the Review’s chair, Dr Jane Lomax-Smith, was explicit in its assessment that primary medical education (predominantly through undergraduate degree programs) remains underfunded.

15 Apr 2012

In an era of reviews, reports and reforms, funding for medical education is set to undergo a substantial reconfiguration. As with any restructure, this presents both challenges and opportunities. This is well illustrated by three active consultations, the outcomes of which will profoundly influence the ongoing resourcing of clinical training.

The first of these is the Higher Education Base Funding Review. The report recently handed down by the Review’s chair, Dr Jane Lomax-Smith, was explicit in its assessment that primary medical education (predominantly through undergraduate degree programs) remains underfunded. It would seem that the Review’s findings were heavily influenced by the submission from Medical Deans Australia and New Zealand, which concluded that the finding shortfall was in the magnitude of $23,000 per student, per annum. The Deans’ (compelling) argument was based on international comparison and a national benchmarking study of course costs.

The Government is currently consulting on the Review and is expected to release its response in the second half of this year. AMSA has recently published its own analysis, which offers resounding endorsement of the report’s call to “place a high priority on increasing the funding to those disciplines that are demonstrably underfunded.” The challenge now, of course, is to translate the Review’s assertions into remedial action and public policy.

The case for investing in primary medical education is a strong one, but in the current economic climate (and in the era of alternative funding via Health Workforce Australia) seeking inflation of the Commonwealth contribution to MBBS and MD programs may be an uphill battle. One of the challenges is that medicine already receives a higher allocation than most other courses, and some players in the higher education sector will discourage further increases. Another major risk is the Review’s suggestion that the student contribution for all courses be lifted to 40 per cent of total costs, which for medicine would constitute a substantial and, in the case of many, prohibitive rise.

The second consultation is the draft pricing framework for public hospitals, recently released by the Independent Hospital Pricing Authority. As noted in this publication previously, the IHPA has initially proposed a block-funding model for teaching, training and research activities. The paper asked questions, however, about the feasibility of shifting to an activity based model in years to come.

The issue with activity based funding for education activities is that it is nearly impossible to separate clinical training from service delivery. Various groups have already tried, and failed, to tease out the constituent costs. A major risk is that an ABF system might fund the obvious educational infrastructure (eg, libraries and tutorial rooms) but not the essential aspects of clinical teaching (eg, teaching ward rounds, procedural supervision and bed-side instruction).

In this fundamental shake up of health financing arrangements, there are other important questions that must be asked. What formulae will determine the quantum of funding for teaching, training and research activities? How will health services be held accountable for moneys earmarked for clinical training? What is the best way of measuring performance and ensuring that quality in medical education is maintained?

Fortunately, the installation of the new financing arrangements won’t occur for some years yet. This provides the medical community with an important opportunity to develop a transparent funding model that offers value for taxpayers, trainees and educators alike.

The third activity of note is the National Training Plan (recently rebadged Health Workforce 2025) currently being developed by Health Workforce Australia. In its short life to date, HWA has been become a very significant player in the medical education landscape, not least because it holds $1.6 billion of government funding. Although the AMA has been critical of the extent to which HWA consults with the medical profession, it has had the opportunity to contribute to the governance committee for the NTP.

While the NTP is not, in fact, a plan, it will establish with relative certainty the future training pipeline for medicine, nursing and midwifery. It is likely that the projections will form the basis for future COAG funding commitments for training places. Given that the NTP is based on relatively robust supply/demand modelling (that has been subject to some sensitivity analyses), it will provide a reasonable blueprint for the required investments in training and workforce.

On this basis, the AMA has called for the Medical Training Review Panel to monitor, on an annual basis clinical training growth targets based on NTP data. This should prove a useful lever by which to encourage governments to adequately invest in teaching and supervisory capacity.

As these examples illustrate, funding models for medical education and training are set to change. What is critical is that the profession advocates for financing reforms that are evidenced based and constitute good value for money. Accountability and transparency must also be assured. While there is always a strong case for investing in the future health workforce, the means by which that is achieved requires ongoing thought and discussion.


Published: 15 Apr 2012