Term Meaning
(the) Act

The National Health Reform Act 2011.

Activity based funding

A system for funding public hospital services based on the actual number of services provided to patients and the efficient cost of delivering those services. Activity based funding uses national classifications, cost weights and nationally efficient prices to determine the amount of funding for each activity or service.

(the) Administrator

The Administrator of the National Health Funding Pool (the Administrator) is an independent statutory office holder, distinct from Commonwealth and state and territory government departments, established under legislation of the Commonwealth and state and territory governments.

The role of the Administrator, with support from the National Health Funding Body, is to administer the payment of public hospital funding according to the National Health Reform Agreement, and to oversee payments into and out of the Reserve Bank pool account for each state and territory, collectively known as the National Health Funding Pool (the Pool).

(the) Agreement

The National Health Reform Agreement entered into by all states, territories and the Commonwealth in August 2011 sets out significant reforms to the way in which public hospitals are funded nationally.

Block funding

A system of funding public hospital functions and services as a fixed amount based on population and previous funding.

Under National Health Reform, block funding will be provided to states and territories to support teaching and research undertaken in public hospitals and for some public hospital services where it is more appropriate, particularly smaller rural and regional hospitals.

CEO Chief Executive Officer.
Council of Australian Governments (COAG)

The peak intergovernmental forum in Australia. The members of COAG are the Prime Minister, state and territory Premiers and Chief Ministers and the President of the Australian Local Government Association.

FMA

The Financial Management and Accountability Act 1997. The main purpose of this Act is to provide a framework for the proper management of public money and public property.

National Health Funding Body (Funding Body or NHFB)

An independent statutory body established under Commonwealth legislation to assist the Administrator in carrying out his or her functions under Commonwealth, state and territory legislation.

National Health Funding Administrator Payments System (Payments System)

The Payments System processes the national health reform Commonwealth, state and territory deposits and payments into and out of the Pool, as required under the Act.

National Health Funding Pool (Pool)

A collective name for the state pool accounts of all states and territories, also known as the ‘the Pool’. The Pool was established under Commonwealth and state and territory legislation for the purpose of receiving all Commonwealth and activity based state and territory public hospital funding, and for making payments under the Agreement.

National health reform

National health reform includes significant reforms to the way in which public hospitals are funded nationally in Australia, as set out in the National Health Reform Agreement entered into by all states, territories and the Commonwealth in August 2011.

National Health Reform Agreement (the Agreement)

National Health Reform Agreement, see ‘(the) Agreement’.

Health Reform Implementation Group (HRIG) Financial Operations Subgroup

This subgroup was represented by the Commonwealth, and all states and territories to develop and implement the national health reform funding arrangements, prior to the establishment of the Funding Body.

Local hospital networks (LHNs)

An organisation that provides public hospital services in accordance with the Agreement. A 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 a LHN. LHNs receive activity based and block funding under the Agreement.

Some states and territories use their own terminology to describe local hospital networks, such as ‘local hospital districts’.

(the) Pool

See ‘National Health Funding Pool’.

State managed fund

A separate bank account or fund established by a state or territory for the purposes of health funding under the Agreement which must be undertaken in the state or territory.

State pool account

A Reserve Bank account established by a state or territory for the purpose of receiving all Commonwealth and activity based state and territory public hospital funding, and for making payments under the Agreement. The state pool accounts of all states and territories are collectively known as the National Health Funding Pool or the Pool.

 

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