The Prime Minister and his Health Minister have made it clear that the next set of Australian Health Care Agreements will extend well beyond mere financial agreements through which the Commonwealth hands over money to the states for the operation of public hospitals.
Explicit in their National Health Reform Plan is a process for moving the funding relationship under the agreements towards a greater focus on patient outcomes by offering financial incentives to the states and territories to implement programs to reduce avoidable hospitalisations and readmissions, reduce non-urgent emergency department presentations, tackle waiting times for elective surgery, and help get the frail elderly out of hospital into residential aged care.
As the Government moves to tackle these election commitments in health, it must juggle the information flow from a raft of new working groups, advisory committees and commissions, the need to assess and develop policies, and then the implementation of agreed policies and performance indicators into funding agreements.
The announcement yesterday from the Council of Australian Governments that the new agreements will be rolling agreements, with periodic reviews, does make it easier for the Federal Government to make its financial commitments ahead of any health reforms.
The newly established National Health and Hospitals Reform Commission's first task was to provide some advice quickly on performance, focusing on elective surgery, aged and transition care and quality and safety, by April and the Australian Institute of Health and Welfare has been commissioned to do some of this work.
So it seems quite possible that the end of June will see a new set of agreements on the table. Aside from election commitments, these are not likely to involve changes in indexation or increased funding, although clever packaging will make them seem generous.
The additional funding will include $150million already announced for elective surgery backlogs, $200million for systematic approvals such as building day surgery units, $25 million for follow-up colonoscopies for bowel cancer screening, and funding for 2000 transition care beds, all promised during the election.
Presumably the states and territories will be allowed to keep the savings, estimated at $937million a year, resulting from the provision of the transition beds, although there should be a proviso that this windfall is reinvested in health.
The prevention agenda will be addressed by incorporating the Public Health Outcomes Funding Agreements and other health-related special purpose payments into the agreements, which will help give the impression that funding has increased.
There will also be the promise of $300million in dividend payments to states and territories that meet performance targets.
The proposed structure of the new, expanded agreements will make it easier for the Government to slot in policy changes and reforms as they are developed, without having to wait for five years.
But it also means that the long-term reform agenda will be a set of promises based on advice that will not be received in its final form until June 2009. At that point, what happens to the National Health and Hospitals Reform Commission and will a report remain its only legacy?
One of the approaches taken at the very beginning of the Medibank/Medicare system provides some instructive insights into how an independent and expert advisory committee can work constructively and long-term within the political and federal system.
The Hospitals and Health Services Commission was established by legislation and its work was described as a judicious blend of study and action. It was a remarkably successful organisation, demonstrating the value of a federal level entity capable of analysing data, developing appropriate policy proposals, translating them into programs and implementing rigorous evaluation mechanisms.
To the extent that the National Health and Hospitals Reform Commission has borrowed the name of this earlier committee, it may also pay to look at what else can be borrowed and utilised to the long-term benefit of health reform in Australia.
Dr Russell is the Menzies Foundation Fellow at the Menzies Centre for Health Policy, University of Sydney / Australian National University.
These are edited remarks from a seminar entitled, "Reality Bites: Translating election commitments into health policies and programs" which Dr Russell delivered at the University of Sydney last night.