Western Australian report, September 2018

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In this report

This report includes the following tables:

This report is issued by the Administrator of the National Health Funding Pool under section 240 of the National Health Reform Act 2011.

This report is prepared on a cash basis. It shows monthly and year-to-date (YTD) National Health Reform (NHR) funding and payments for Western Australia for September 2018 as part of the National Health Reform Agreement.

Local hospital networks and National Health Reform

A local hospital network (LHN) is an organisation that provides public hospital services in accordance with the Agreement. An LHN can contain one or more hospitals, and is usually defined as a business group, geographical area or community. Every Australian public hospital is part of an LHN.

Note: The term ‘local hospital network’ is a national term. Some states and territories use their own terminology to describe these networks, such as local health districts, health organisations, and hospital and health services.

Under the Agreement, LHNs receive funding for the following public hospital services:

  • All admitted and non-admitted services
  • All emergency department services provided by a recognised emergency department
  • Other outpatient, mental health, sub-acute services and other services that could reasonably be considered a public hospital service.

Note: LHNs also receive funding from other sources, including the Commonwealth, states and territories, and third parties for the provision of other specific functions and services outside the scope of the Agreement, for example dental services, primary care, home and community care, residential aged care and pharmaceuticals. For further information on total funding to a particular LHN, contact the WA Department of Health to view the service agreement for that LHN.

Basis for National Health Reform payments – Western Australia, September 2018

The basis used to determine NHR payments to LHNs in Western Australia for September 2018 is as follows:

Service agreements between the Department of Health (the Department) and Health Service Providers (HSPs) are based on the Department’s funding and purchasing policies and resource allocation models.

The Western Australia Activity- Based Funding (WA ABF) model determines the price at which the Department purchases services from HSPs and the type and volume of services that are purchased. Metropolitan public hospitals and Regional and District rural hospitals are funded through the WA ABF model. The WA ABF model is based on the national ABF model however, it includes a range of modifications reflecting WA funding principles and purchasing mechanisms.

Small rural hospitals are funded through block funding arrangements which, although based on the National Efficient Cost Determination contain some funding modifications.

The vast majority of non-hospital services are block-funded. Block funding is based on budget to budget build from the previous year using WA State Government funding parameters consistent with the WA State budget.

Reference information

The financial information outlined in the following report is categorised as:

  • NHR funding – when the Commonwealth or state or territory government pays NHR funding into a state pool account or state managed fund.
  • NHR payments – when NHR funding that has been deposited into a state pool account or state managed fund is paid out of the state pool account by the Administrator, or is paid out of the state managed fund by the state or territory.

State pool account transactions

Table 1a – State pool account transactions – Western Australia, September 2018

This table shows funding paid into the Western Australian state pool account by the Commonwealth, Western Australia or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the WA Department of Health or the state pool accounts of other states/territories for September 2018.

NHR funding by source Paid into state pool account Paid out of state pool account
To Local hospital networks To State
Managed Fund
To state
health department
To state pool (other State) Total paid out
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
158,773,483 158,773,483 158,773,483
Commonwealth
Block funding
23,821,772 23,821,772 23,821,772
Commonwealth
Other funding
3,548,738 3,548,738 3,548,738
Total C'wealth
funding
186,143,993 158,773,483 23,821,772 3,548,738 186,143,993
WA
funding
13,865,766 13,865,758 0 0 13,865,758
Other state/territory funding 0 0 0 0
Total 200,009,759 172,639,241 23,821,772 3,548,738 0 200,009,751

See definitions and explanatory notes following table 1b.

Table 1b – State pool account transactions YTD – Western Australia, September 2018

Following on from table 1a, this table shows year-to-date (YTD) funding paid into the Western Australian state pool account by the Commonwealth, Western Australia or other states/territories, and payments out of the state pool account to LHNs, the state managed fund, the WA Department of Health or the state pool accounts of other states/territories as at September 2018.

NHR funding by source Paid into state
pool account
Paid out of state pool account
To Local hospital
networks
YTD
To State
Managed Fund
YTD
To state health
department
YTD
To state pool (other State)
YTD
Total paid out
YTD
($) ($) ($) ($) ($) ($)
Commonwealth
ABF funding
476,320,450 476,320,450 476,320,450
Commonwealth
Block funding
71,465,315 71,465,315 71,465,315
Commonwealth
Other funding
10,646,214 10,646,214 10,646,214
Total C'wealth
funding
558,431,980 476,320,450 71,465,315 10,646,214 558,431,980
WA
funding
41,836,545 41,836,521 0 0 41,836,521
Other state/territory funding 0 0 0 0
Total 600,268,525 518,156,972 71,465,315 10,646,214 0 600,268,501

Commonwealth ABF funding represents Acute admitted, Non-admitted, Emergency department, Sub-acute, and Admitted mental health service categories, which are funded by the Commonwealth through the state pool account and subsequently paid to LHNs.

Commonwealth Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted categories, which are funded by the Commonwealth and paid to the state managed fund.

Commonwealth Other funding represents other amounts funded by the Commonwealth, transacted through the state pool account and subsequently paid to state or territory health departments. This currently represents the Commonwealth contribution to public health.

WA funding represents funding contributions paid by Western Australia into its own state pool account, and subsequently paid to LHNs within the state, to the Western Australian health department and/or to other state pool accounts.

Other state/territory funding represents contributions paid to Western Australia by other states and territories for cross-border activity.

Note: The grey shaded areas in these tables reflect cells that are not applicable for a particular 'paid out' column. For example, Commonwealth block funding is only paid to state managed funds and not to local hospital networks or state or territory health departments.

NHR funding and payments shown in these tables include GST where applicable.

State managed fund transactions

Table 2a – State managed fund transactions – Western Australia, September 2018

This table shows funding paid into the Western Australia state managed fund by the Commonwealth and Western Australia, and payments out of the state managed fund to LHNs and other provider organisations for September 2018.

NHR funding by source Paid into state managed fund Paid out of state managed fund
To local hospital networks To Other Total paid out
($) ($) ($) ($)
Commonwealth Block funding 23,821,772 23,821,772
State/territory Block funding 13,907,858 14,732,044
Total 37,729,630 37,889,759 664,056 38,553,815

See explanatory notes following table 2b.

Table 2b – State managed fund transactions YTD – Western Australia, September 2018

Following on from table 2a, this table shows year-to-date (YTD) funding paid into the Western Australian state managed fund by the Commonwealth and Western Australia, and YTD payments out of the state managed fund to LHNs and other provider organisations as at September 2018.

NHR funding by source Paid into state
managed fund
YTD
Paid out of state managed fund YTD
To local hospital
networks
YTD
To Other
YTD
Total paid out
YTD
($) ($) ($) ($)
Commonwealth Block funding 71,465,315 71,465,315
State/territory Block funding 76,666,940 76,666,940
Total 148,132,255 146,140,087 1,992,168 148,132,255

Block funding represents Non-admitted mental health, Small rural hospitals, Teaching, training & research, and Other non-admitted categories.

Commonwealth Block funding represents Commonwealth block funding contributions paid into the state managed fund from the state pool account, and block payments out of the state managed fund to LHNs and other provider organisations.

State/territory Block funding represents Western Australian block funding contributions into the state managed fund, and block payments out of the state managed fund to LHNs and other provider organisations.

Note: The grey shaded areas in these tables reflect that these block payments cannot at this stage be identified by source of funding (state, territory or Commonwealth contribution).

NHR funding and payments shown in these tables include GST where applicable.

NHR funding and payments by service category

Table 3 – NHR funding and payments by service category – Western Australia, September 2018

This table shows NHR funding and payments by service category on both a monthly and year-to-date (YTD) basis for Western Australia for September 2018. NHR funding and payments are separated into the following service categories – activity-based funding (ABF), block funding, and other funding.

Service category NHR
funding
NHR
payments
NHR
funding YTD
NHR
payments YTD
($) ($) ($) ($)
ABF
Acute admitted 98,247,303 98,247,303 294,741,908 294,741,908
Admitted mental health 23,704,316 23,704,316 67,707,592 67,707,592
Sub-acute 9,028,363 9,028,363 25,731,631 25,731,631
Emergency department 18,480,762 18,480,762 57,984,742 57,984,742
Non-admitted 23,178,497 23,178,497 71,991,098 71,991,098
Total ABF (Pool) 172,639,241 172,639,241 518,156,972 518,156,972
Block
Small rural hospitals 8,555,773 8,555,773 40,667,319 40,667,319
Teaching, training & research 8,571,231 8,571,231 43,907,600 43,907,600
Non-admitted mental health 20,140,514 20,040,474 62,170,998 62,170,998
Other non-admitted services 462,113 1,386,338 1,386,338 1,386,338
Total Block (SMF) 37,729,630 38,553,815 148,132,255 148,132,255
Other
Public health funding 3,548,738 3,548,738 10,646,214 10,646,214
Overdeposit 0 0 0 0
Cross-border 0 0 0 0
Interest 8 0 24 0
Total Other (Pool) 3,548,746 3,548,738 10,646,238 10,646,214
Grand Total 213,917,617 214,741,795 676,935,465 676,935,441

Total ABF (Pool) is an aggregate of both Commonwealth and state or territory NHR funding and payments for activity-based funding (ABF) which is transacted through the state pool account.

Total Block (SMF) is an aggregate of both Commonwealth and state or territory NHR funding and payments for block funding which is transacted through the state managed fund (SMF).

Total Other (Pool) represents other funding and payments transacted through the state pool account, including public health funding, overdeposits, cross-border funding and payments, and interest.

State and territory cross-border payments can either be:

  • Paid to the relevant state or territory's LHNs - included within ABF and/or block payments in the above table, or
  • Reimbursed to the relevant state or territory where the state or territory's LHNs are already being funded for the cost of treating cross-border patients - shown in the Cross-border row under Other in the above table.

NHR funding and payments shown in these tables include GST where applicable.

NHR contributions by local hospital network

Table 4a – NHR contributions by local hospital network – Western Australia, September 2018

This table shows NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Western Australia during September 2018.

NHR contributions to LHNs are separated into an activity-based funding (ABF) component and a block component.

Local hospital network (LHN) ABF component
(ex GST)
Block component
(ex GST)
Total NHR payment
(ex GST)
($) ($) ($)
Child and Adolescent Health Service 10,715,354 1,697,337 12,412,691
East Metropolitan Health Service 38,815,892 7,447,098 46,262,990
North Metropolitan Health Service 51,137,440 9,612,242 60,749,682
Notional LHN - Royal Street - WA 3,091,549 0 3,091,549
South Metropolitan Health Service 43,753,441 5,681,868 49,435,310
WA Country Health Service 25,125,564 13,451,215 38,576,778
Total 172,639,241 38,553,815 211,193,057

See explanatory notes below table 4b.

Table 4b – NHR contributions by local hospital network YTD – Western Australia, September 2018

This table shows YTD NHR contributions (from state, territory and Commonwealth sources) made to each LHN in Western Australia as at September 2018.

NHR contributions to LHNs are separated into an activity-based funding (ABF) component and a block component.

Local hospital network ABF component YTD
(ex GST)
Block component YTD
(ex GST)
Total NHR payment YTD
(ex GST)
($) ($) ($)
Child and Adolescent Health Service 32,146,063 3,706,952 35,853,015
East Metropolitan Health Service 116,447,677 23,043,518 139,491,195
North Metropolitan Health Service 153,651,570 45,630,783 199,282,353
Notional LHN - Royal Street - WA 9,274,647 0 9,274,647
South Metropolitan Health Service 131,260,324 18,311,223 149,571,547
WA Country Health Service 75,376,691 55,447,610 130,824,301
Total 518,156,972 148,132,255 666,289,227

NHR contributions in this table are GST exclusive to enable comparability of NHR payments in each LHN report.

Note: This table excludes GST.
The majority of government funding to LHNs is not subject to GST. However in some cases hospital funding to non-government entities does attract GST, for example, denominational hospitals, privately and commercially owned health facilities, or any other non-government third party provider of health services or related supplies.

Estimated monthly, YTD and annual activity

States and territories provide service volume estimates at the start of each financial year, and if required, can continue to refine these estimates during the course of the year. These estimates form the basis of monthly reporting of service volumes until actual service numbers become available. These estimates are expressed as National Weighted Activity Units (NWAU).

States and territories provide estimated annual NWAU to the Administrator as a basis for determining the Commonwealth activity-based funding. Current month NWAU estimates accumulate through the year-to-date (YTD) NWAU, to be equal to the annual NWAU at the end of the financial year.

States and territories may also provide activity information relating to the delivery of other public hospital functions funded.

Table 5 – Estimated monthly, YTD and annual NWAU by local hospital network – Western Australia, September 2018

This table shows estimated state or territory hospital activity for activity-based funding services expressed as NWAU for September 2018, the associated cumulative year-to-date (YTD), and total estimated annual NWAU for each LHN in Western Australia.

Local hospital network (LHN) Estimated NWAU delivered in current month Estimated NWAU delivered YTD Estimated annual NWAU 2018-19
Child and Adolescent Health Service 4,797 14,468 54,773
East Metropolitan Health Service 16,445 50,965 196,235
North Metropolitan Health Service 21,127 65,185 254,726
Notional LHN - Royal Street - WA 1,366 4,106 15,909
South Metropolitan Health Service 19,967 59,489 230,989
WA Country Health Service 11,342 34,463 132,908
Total 75,044 228,676 885,540

An NWAU is a measure of health service activity expressed as a common unit. It provides a way of comparing and valuing each public hospital service, whether they are admissions, emergency department presentations or outpatient episodes, by weighting them for their clinical complexity. The average hospital service is worth one NWAU - the most intensive and expensive activities are worth multiple NWAU, the simplest and least expensive are worth fractions of an NWAU.

Monthly NHR payments relate to the cash needs of public hospitals and do not necessarily reflect the volume of services to be delivered in the month.