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06 Jul 2015

The Commonwealth Government has committed to produce a White Paper on the Reform of the Federation, working with the states and territories.

According to the Government, the White Paper will seek to clarify roles and responsibilities to ensure that, as far as possible, the states and territories are sovereign in their own sphere. Defining roles and responsibilities in health are a critically important part of this process.

At the time of writing, a Department of Prime Minister and Cabinet Discussion Paper detailing possible options for reform has just been released, and it is expected the Government will release a Green Paper later in the year, after further discussions with the states and territories. This will feed into the development of the Reform of the Federation White Paper, expected to be released in 2016.

Public discussion of the Reform of the Federation process and options for change has hardly begun, but the topic is warming up at heads of government level, and will be further fuelled by the release of the Government‘s discussion paper. 

The AMA has been a catalyst for this discussion, helping to ensure that public hospitals funding is a main agenda item at the heads of government leaders’ retreat later this month.

The Health Financing and Economics Committee considered the issue of reform of the Federation at its meeting on 14 February, and its discussions helped inform Federal Council deliberations in a policy breakout session at its meeting on March 13 and 14.

Immediately prior to the last COAG meeting on 17 April, the AMA released the AMA Public Hospital Report Card 2015, which highlighted the declining level of Commonwealth funding for public hospitals, and that public hospitals were not meeting key performance targets even with the current level of funding.

Public hospital funding was also a focus for a high profile and successful policy session at AMA National Conference on 30 May which outlined the impacts of inadequate funding on public hospitals in two states.

So, where is the Federation Reform process up to?

Later this month Australia’s heads of government will have an opportunity to take a leadership approach to considering reform of the federation and how reform could help address some of the big issues facing Australia over the medium to longer term.

The best approach to future roles and responsibilities in health is one of those issues. We need to ensure this debate is framed in a useful way.

The discussion paper canvasses five options for health and hospitals: states and territories take full responsibility for public hospitals; a Medicare-type rebate scheme for all hospital treatments; states and Commonwealth jointly responsible for funding care packages for chronic and complex patients; regional purchasing agencies be funded to purchase health services; and the Commonwealth becomes the single funder of health services and establishes a health purchasing agency.

Early reporting has focused on whether particular proposals for reform will produce more or less accountability and efficiency. These are important features of any arrangements. 

But they are not as important as whether reforms will deliver the capacity that public hospitals require to meet the needs of patients for timely and high quality hospital care.

If you ask any patient, they will be interested first and foremost in whether they and their families can expect to receive hospital care when they need it and to a high standard of quality.  As doctors we have this interest in common.

This is the basic thing that our public hospitals absolutely need to get right. It’s the first test that should be applied to any options for change. 

HFE and other AMA committees will be considering the options to help the AMA influence the development of sensible and practical outcomes for health from the Reform of the Federation process.  Your input and views will be valuable as part of this work.


Published: 06 Jul 2015