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Hospital performance getting worse and now facing budgetary 'black hole', says AMA

The Australian Medical Association is warning of an imminent crisis for public hospitals unless funding is increased.

The federal government is under pressure to reform taxes following a report card on public hospitals that shows the most urgent patients are waiting longer at the emergency departments, bed ratios are deteriorating and elective surgery waiting times are static.

The Australian Medical Association is using its annual report on the performance of public hospitals to call for an overhaul of health funding, which faces slower growth from July next year when new funding arrangements come into effect.

AMA president Brian Owler says public hospitals are facing a budgetary "black hole".
AMA president Brian Owler says public hospitals are facing a budgetary "black hole". Photo: Andrew Meares

AMA president Brian Owler said hospitals would be insufficiently funded to meet the rising demand from 2017, when the states and territories were facing a "black hole".

A Treasury analysis found $57 billion would be removed from the health system over 10 years.

"The issue is that the [funding] increase is not going to be anywhere near the rate of growth that is required to maintain services, let alone see an improvement," Professor Owler said.

"What we've already seen in this report card is that the focus has come off the elective surgery and emergency access targets and we've seen performance fall.

"The states and territories are facing a public hospital funding black hole from 2017, when growth in federal funding slows to a trickle."

The federal government has abandoned funding guarantees that were made under the National Health Reform Agreement in 2011, and from July next year it will limit funding increases to population growth and indexation.

The AMA report card shows the proportion of urgent patients seen within 30 minutes of presentation at the emergency department slipped to 68 per cent in 2014-15 after six previous years of steady improvement.

Across all emergency patients, 73 per cent were seen within the clinically recommended time of four hours, compared with a national target of 90 per cent to be seen within this time.

The median waiting time for elective surgery in 2014-15 was reduced by one day to 35 days, the same as it was in 2009-10.

Meanwhile, the bed ratio drifted to its lowest level in 2013-14, with 2.51 beds for every 1000 people aged over 65.

NSW has plateaued against most measures. Victoria's emergency department performance has remained static but its elective surgery waiting times have improved. Queensland is is facing longer emergency department waiting times, but shorter waits for elective surgery.

But the smaller states – Tasmania, SA, the Northern Territory and the ACT – have struggled to meet their performance targets.

"We know that public hospitals are facing growing demand, particularly in the emergency departments, where patients in the highest triage category are making up the majority of the numbers," Professor Owler said.

It was not for the AMA to recommend whether increased funding should be achieved by an increase to the GST or a rise in the Medicare levy.

"But any change in the taxation policy should not just be used to give income tax cuts, as the Treasurer has suggested."

NSW Premier Mike Baird has called for the GST to be lifted to 15 per cent for the health system to survive, warning that the state risked "tumbling off a fiscal cliff".

Health Minister Sussan Ley declined to answer questions on the extent to which changes to the health budget affected hospital performance or whether future funding should take into account the growing burden of chronic disease.

"Hospital spending under the Turnbull government increases each and every year and there were no policy changes in the 2015-16 Budget or MYEFO which affect this," she said instead.

"Commonwealth public hospital funding continues to grow over the next four years, with an increase of $3.3 billion or around 21.5 per cent."