This Annual Report details the activities of the National Health Funding Body (NHFB) from 1 July 2015 to 30 June 2016.

It is prepared in accordance with the requirements for Annual Reports issued by the Commonwealth Department of Finance.

It should be read in conjunction with the Administrator National Health Funding Pool Annual Report 2015–16.

Administrator National Health Funding Pool Annual Report 2015-16

The NHFB Chief Executive Officer (CEO) is required to prepare and present this report to the Commonwealth Parliament, pursuant to section 267 of the National Reform Act 2011 (the Act) and section 70 of the Public Service Act 1999, and provide a copy of this report to each state and territory Health Minister under section 267(2) of the Act.

The $41 billion on the cover page in payments to Australian public hospitals represents the amounts paid to local hospital networks from the State Pool Accounts and State Managed Funds, for weighted public hospital services. Further detail can be found in the Administrator National Health Funding Pool Annual Report 2015–16 on page iii.

FURTHER INFORMATION

If you require further information or have any queries in relation to this Annual Report, please contact:

NATIONAL HEALTH FUNDING BODY

GPO Box 1252 Canberra ACT 2601

1300 930 522

nhfb.enquiries@nhfb.gov.au

nhfb.gov.au

An accessible copy of this Annual Report is available online at nhfb.gov.au/publications.

VISION, MISSION AND STRATEGIC OBJECTIVES

OUR VISION

Improved health outcomes for all Australians, sustainability of a nationally unified and locally controlled Australian health system, and increased transparency in public hospital funding.

OUR MISSION

To support the obligations and responsibilities of the Administrator of the National Health Funding Pool (the Administrator), by providing transparent and efficient administration of Commonwealth, state and territory funding of the Australian public hospital system.

OUR STRATEGIC OBJECTIVES

We have adopted five high–level strategic objectives, which capture the scope of our responsibilities and serve the Vision and Mission of our organisation.

ACHIEVE BEST PRACTICE AND ACCOUNTABILITY

To achieve best practice and accountability through assisting the Administrator in implementing and overseeing nationally consistent public hospital funding arrangements, through the National Health Funding Pool.

PROVIDE INCREASED TRANSPARENCY AND EFFECTIVE REPORTING

To provide increased transparency and effective reporting on the local hospital networks that are funded for the services they deliver to the community.

ENABLE ACCURATE COMMONWEALTH CONTRIBUTION CALCULATIONS

To enable accurate Commonwealth contribution calculations by using nationally consistent pricing and costing standards.

DEVELOP PRODUCTIVE AND EFFECTIVE PARTNERSHIPS

To develop productive and effective partnerships with relevant stakeholders, enabling the objectives of the National Health Reform Agreement to be achieved.

OPERATE AS A FULLY FUNCTIONAL AND COMPLIANT AGENCY

To operate as a fully functional and compliant agency, meeting statutory and legislative obligations.

The NHFB Strategic Plan for the period 2013–16 is available from nhfb.gov.au/publications.

LETTER OF TRANSMITTAL

Letter of transmittal

CONTENTS

OUR ORGANISATION

OPERATIONAL HIGHLIGHTS 2015–16

HUMAN RESOURCES

ANNUAL PERFORMANCE

FINANCIAL STATEMENTS

ENDNOTES

NATIONAL HEALTH REFORM REPORTING

SCOPE OF REPORTING

NATIONAL HEALTH REFORM REPORTING SCOPE OF REPORTING

The scope of reporting in the Administrator and NHFB annual reports is funding and payments processed through the National Health Funding Pool and State Managed Funds. This comprises activity based, block and public health funding, which represents the majority of public hospital activity. It may differ from reports published by the Australian Institute of Health and Welfare, states, territories and local hospital networks, due to the inclusion or exclusion of other funding such as specific purpose payments, own source revenue or personal contributions.

NATIONAL HEALTH REFORM FUNDING RECEIPTS 2015–2016

NATIONAL HEALTH REFORM FUNDING RECEIPTS 2015-2016

FUNDING RECEIPTS BY SOURCE

FUNDING RECEIPTS BY SOURCE

FUNDING RECEIPTS BY TYPE

FUNDING RECEIPTS BY TYPE

PAYMENTS TO AUSTRALIAN PUBLIC HOSPITALS BY SOURCE

PAYMENTS TO AUSTRALIAN PUBLIC HOSPITALS BY SOURCE

NUMBER OF WEIGHTED PUBLIC HOSPITAL SERVICES FUNDED

NUMBER OF WEIGHTED PUBLIC HOSPITAL SERVICES FUNDED

Further details on the basis of these amounts can be found in the relevant state or territory section of the Administrator of the National Health Funding Pool 2015–16 Annual Report, or at publichospitalfunding.gov.au. The Administrator is assisted by the NHFB. For further details of the NHFB’s operations, please see the relevant sections of this Annual Report or nhfb.gov.au.

Totals may not equal the sum of components due to rounding

MESSAGE FROM THE CEO

I am pleased to present the fourth NHFB Annual Report for the financial year ended 30 June 2016. It has been an exciting and invigorating year for the NHFB.

The Council of Australian Governments (COAG) agreed on 1 April 2016 to the Heads of Agreement between the Commonwealth and the States and Territories on Public Hospital Funding, which continues the role of the Administrator and NHFB into the future. The Heads of Agreement upholds the objectives of the National Health Reform Agreement (Agreement), which fundamentally changed the landscape of public hospital funding in Australia. The Agreement brought the common language of activity based funding, allowing all jurisdictions greater openness and collaboration, and engagement of citizens in the public resourcing of the health system.

By reaffirming the aims of the Agreement, the Australian Governments have signaled their commitment to a sustainable, transparent and effective health system for all Australians.

This provides significant opportunities to consolidate the excellent work that has been achieved to date, and to identify new areas for enhancement.

A number of high level goals have been set by the governments, and I look forward to working with the Administrator, jurisdictions and other agencies to achieve them.

Our primary function is to assist the Administrator of the National Health Funding Pool (the Administrator) to calculate the amount of the Commonwealth funding to public hospitals in each state and territory under the Agreement, and to administer the National Health Funding Pool.

It has been a successful year for the NHFB, with a total of 5,279 funding and payment transactions processed in 2015–16. The NHFB administered a total of $41.4 billion2 of Commonwealth and state payments to local hospital networks, and calculated the Commonwealth contribution of $17.2 billion3 in 2015–16. The NHFB’s operations are further outlined at nhfb.gov.au.

On behalf of the Administrator, the NHFB prepared 1,780 monthly reports over the financial year, available from publichospitalfunding.gov.au.

These reports assist stakeholders, such as governments, researchers and the media, and the wider public to understand the national health reform funding and payment system and improve the transparency of payment flows and purchased hospital services for the community.

The accomplishments of the NHFB reflect the high performance of the staff and the strong culture of integrity and commitment to success. The small team of specialist staff have worked hard to consistently build on the achievements of previous years, and will continue to do so as the organisation transitions into the new arrangements of the Heads of Agreement. The diversity and agility of the NHFB has allowed us to bring leadership to delivering public hospital funding.

Finally, I would like to take this opportunity to thank Mr Bob Sendt, the Administrator until 1 August 2015, and Mr Kim Snowball, the Acting Administrator until 22 February 2016, for their contribution. I welcome Mr Peter Achterstraat AM as the COAG Health Council’s newly appointed Administrator, and I look forward to working with Peter in progressing the health reform agenda.

Mr Lynton Norris

Chief Executive Officer
National Health Funding Body

Photo of Mr Lynton Norris

Footnotes

2 Administrator National Health Funding Pool 2015–16 Annual Report, page iii.

3 Administrator National Health Funding Pool 2015–16 Annual Report, page 42–43.