ANNUAL PERFORMANCE STATEMENT

STATEMENT OF PREPARATION

This statement has been prepared for paragraph 39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), for the reporting period 1 July 2016 to 30 June 2017.

In my opinion, as the accountable authority of the NHFB, the performance statement accurately represents the NHFB’s performance in the above specified period and complies with subsection 39(2) of the PGPA Act and section 16F of the PGPA Rule.

Signature of Mr Lynton Norris

Mr Lynton Norris

Chief Executive Officer
National Health Funding Body

4 October 2017

NHFB PURPOSE

The purpose of the NHFB is to provide transparent and efficient administration of Commonwealth, state and territory funding of the Australian public hospital system, and support the obligations and responsibilities of the Administrator.

REPORTING APPROACH

This Annual Performance Statement reports against deliverables in the Portfolio Budget Statements (PBS) 2016–17 and NHFB Corporate Plan 2016–17 to 2019–20. The Corporate Plan deliverables are derived from the NHFB Strategic Plan2013–2016.

Figure 2 provides an overview of the NHFB’s vision, mission, PBS indicators, and Corporate Plan objectives.

The report against each Corporate Plan objective contains:

  • analysis of the NHFB’s 2016–17 performance against the objective, including challenges and planned activity for 2017–18
  • graphical representation of performance results for the objective
  • results and discussion against each performance measure
  • how success against this objective contributes to the NHFB’s purpose.

FIGURE 2: OVERVIEW OF THE NHFB’S PERFORMANCE OBJECTIVES

FIGURE 2: OVERVIEW OF THE NHFB'S PERFORMANCE OBJECTIVES

SUMMARY OF FINANCIAL PERFORMANCE

NHFB OPERATING RESULT

The net operating result as at 30 June 2017 was a deficit of $0.265 million, within the Department of Finance approved deficit of $0.500 million for 2016–17. The level of the deficit was reduced as the NHFB capitalised $0.168 million for thenew SAS Commonwealth Contribution Model.

Revenue for the year was $4.397 million, compared with budgeted revenue of $4.358 million. The variance of $0.039 million is due to an increase in the notional audit fee for 2016–17.

Expenditure for the year to 30 June 2017 was $4.662 million, compared with budgeted expenses of $4.358 million. The overspend of $0.265 million is attributable to additional deliverables undertaken for the implementation of the Addendum.

Table 2: NHFB RESOURCE STATEMENT, 2016–17
Actual available appropriations for 2016–17
$’000
Payments made in 2016–17
$’000
Balance remaining in 2016–17
$’000

Ordinary annual services

Departmental appropriation 1

6,270

4,856

1,414

Total ordinary annual services

6,270

4,856

1,414

Special Appropriations

0

0

0

Total resourcing and payments

6,270

4,856

1,414

1 Appropriation Bill (No. 1) 2016–17, prior year departmental appropriation and section 74 receipts.

Table 3: EXPENSES FOR OUTCOME, 2016–17
Budget1
2016–17
$’000
Actual expenses
2016–17
$’000
Variation
2016–17
$’000

Outcome: To provide transparent and efficient administration of Commonwealth, state and territory funding of the Australian public hospital system, and support the obligations and responsibilities of the Administrator of the National Health Funding Pool.

Program 1.1: National Health Funding Pool administration

Departmental expenses

Departmental appropriation2

4,397

4,662

(265)

Special appropriation

0

0

0

Total for Program 1.1

4,397

4,662

(265)

Total for Outcome 1

4,397

4,662

(265)

 

2016–17 2015–16

Average staffing level (number)3

17

14

1 Full year budget, including any subsequent adjustment made to the 2016–17 Budget.

2 Departmental appropriations combine ‘Ordinary annual services (Appropriation Bill No. 1)’ and ‘Revenue from independent sources’ under section 74 of the Public Governance, Performance and Accountability Act 2013.

3 Represents the number of staff paid per fortnight averaged across the financial year.

2016–17 PERFORMANCE STATEMENT SUMMARY

2016–17 PERFORMANCE STATEMENT SUMMARY

RESULTS KEY — NON–FINANCIAL PERFORMANCE

RESULTS KEY — NON–FINANCIAL PERFORMANCE

SUMMARY OF NON–FINANCIAL PERFORMANCE

All performance measures required to meet the needs of the Administrator and Commonwealth, states and territories were achieved in 2016–17.

Planned performance measures included assisting the Administrator to:

  • develop the Three Year Data Plan and associated funding calculation approach
  • calculate the Commonwealth contribution to the Funding Pool
  • ensure the Funding Pool operations are in accordance with directions from the responsible State or Territory Minister, and in line with the Agreement
  • transparently report on the operations of the Funding Pool and state managed funds as outlined in the Agreement.

CHALLENGES

The unanticipated level of involvement and time critical nature of advice in the development and implementation of the Addendum required significant investment from the Administrator and NHFB. This impacted planned activities, including data matching,enhancement of the National Health Funding Administrator Payments System (Payments System), and finalising the Stakeholder Engagement Plan.

Data integrity was an ongoing priority for all stakeholders in 2016–17.

Annual 2015–16 Reconciliation of actual services was not effected in 2016–17 payments as the Commonwealth Treasurer’s Determination 2015–16 was not made in 2016–17.

YEAR AHEAD

The NHFB received additional appropriation in the 2017–18 Commonwealth Budget of $4.1 million over three years (2017–18 to 2019–20) to fully implement the requirements of the Addendum, enhance the Payments System, transition of theCommonwealth Contribution Model to a more robust platform, and progress national health reform funding integrity analysis.

The NHFB will work closely with the Commonwealth, states and territories to implement these initiatives in 2017–18.

ADDITIONAL DELIVERABLES UNDERTAKEN

In 2016–17, the Administrator and NHFB received a number of referrals and requests for national health reform funding advice and analysis, in addition to the activity outlined in the Corporate Plan. The major focus of this work was the development and implementation of the Addendum, signed by the Commonwealth, states and territories in June 2017 for 1 July 2017 implementation.

Advice
Action
Outcome

Feasibility of the Funding Cap

August 2016

At the request of the Commonwealth, states and territories (via the Department of the Prime Minister and Cabinet), the NHFB undertook detailed modelling of policy proposals and scenarios for the funding cap, to ensure viable implementation.

The analysis assisted Commonwealth, state and territory governments in agreeing to revised hospital funding arrangements, resulting in successful negotiation of the Addendum.

Advice on the draft Addendum

January 2017

Also at the request of the Commonwealth, states and territories, the NHFB undertook a comprehensive review of the proposed clauses and policy reforms in the draft Addendum. Advice was provided on:

  • feasibility of implementing the Addendum as drafted
  • risks and challenges associated with proposed modifications
  • clarification of terminology.

As a result of the advice, the Addendum was refined for further jurisdictional consultation.

Blueprints for implementation of the Addendum

February 2017

The NHFB developed a series of blueprints to illustrate the steps required to implement the Addendum by 1 July 2017.

The advice provided transparency and certainty to the calculation of Commonwealth national health reform funding under the Addendum.

Advice on the Safety and Quality Adjustment

February 2017

At the request of the Commonwealth, states and territories, the Administrator and NHFB modelled approaches to calculating the Safety and Quality adjustment and its impacts on Commonwealth national health reform funding.

The Safety and Quality modelling and analysis clarified the potential impacts and enabled the Commonwealth, states and territories to agree the preferred funding treatment and impact.

Analysis of Growth in Commonwealth national health reform funding

June 2017

Following a request from the Commonwealth Treasurer on the underlying drivers of growth in the Commonwealth contribution to public hospital services in 2015–16, the NHFB undertook a detailed review of actual activity data andthe impact on funding outcomes.

The Administrator’s report advised the Commonwealth Treasurer on the drivers of growth on Commonwealth national health reform funding. The report was provided to the Council of Australian Governments (COAG) Health Council in June 2017.

OBJECTIVE ONE: 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.

ANALYSIS OF PERFORMANCE

All performance measures for Objective One were met by the NHFB in 2016–17.

All payments and deposits through the Payments System were in line with developed schedules, and the direction of the relevant Minister.

The NHFB developed, maintained and publicly released the following policy documents on the publichospitalfunding.gov.au website:

  • The Administrator’s Three Year Data Plan and associated File Specifications
  • Growth and Funding Guarantees policy
  • Data Privacy, Secrecy and Security policy.

The 2016–17 Reconciliation Framework policy was developed and issued to the Commonwealth, states and territories in June 2017. This policy will be updated (if required) and publicly released upon the Commonwealth Treasurer’s Determination of 2015–16 national health reform payments under the Federal Financial Relations Act 2009.

CHALLENGES

Following a request from the Commonwealth Treasurer on the underlying drivers of growth in the Commonwealth contribution to public hospital services in 2015–16, the NHFB undertook a detailed review of actual activity data and the impact on funding outcomes.

Annual 2015–16 Reconciliation of actual services was not effected in 2016–17 payments as the Commonwealth Treasurer’s Determination 2015–16 was not made in 2016–17.

THE YEAR AHEAD

In 2017–18, the NHFB will focus on implementing the reforms of the Addendum and enhancing the Payments System.

CORPORATE PLAN PERFORMANCE MEASURE 1.1

Develop and implement efficient and robust processes to oversee national health reform funding and payments through the Funding Pool.

2016–17 Target
Result
Analysis

Ensure payments and deposits through the Payments System are in line with developed Payment and Deposit Schedules.

Corporate Plan pg. 14

Met

All payments and deposits through the Payments System were in line with developed schedules, and the direction of the relevant Minister.

The NHFB followed strict governance procedures to ensure all payments were made at the direction of State/Territory Ministers (via authorised Payments System users). The Payment and Deposit Schedules were developed based on advicefrom states and territories.

By ensuring all payments were in line with State/Territory Minister direction, the NHFB assisted the Administratorin effectively administering public hospital funding.

CORPORATE PLAN PERFORMANCE MEASURE 1.2

Develop and publish documents that will provide expert national health reform policy advice to the Administrator and stakeholders.

2016–17 Target
Result
Analysis

Develop and publicly release the Administrator’s:

  • Three Year Data Plan 2016–17 to 2018–19 and File Specification for Data Submission
  • Growth and Funding Guarantees policy
  • Data Privacy, Secrecy and Security policy
  • Reconciliation Framework policy

Corporate Plan pg. 14

Met

The NHFB developed, maintained (as necessary) and publicly released the following policy documents on the publichospitalfunding.gov.au website:

  • The Administrator’s Three Year Data Plan and associated File Specifications
  • Growth and Funding Guarantees policy
  • Data Privacy, Secrecy and Security policy

These policy documents provide transparency over the Administrator’s calculation and administration of national health reform funding and payments.

The 2016–17 Reconciliation Framework policy was developed and issued to the Commonwealth, states and territories in June 2017. This policy will be updated (if required) and publicly released following the Commonwealth Treasurer’sDetermination of 2015–16 national health reform payments under the Federal Financial Relations Act 2009.

Deliver the rolling
Three Year Data Plan.

Determine the data required to calculate the Commonwealth’s contribution, conduct reconciliation and data matching activities and ensure national comparability under the Agreement.

PBS pg. 374

Met

The Administrator’s Three Year Data Plan 2017–18 to 2019–20 was accepted by the COAG Health Council, and was publicly released (together with associated File Specifications) on the
publichositalfunding.gov.au website on 28 June 2017.

CORPORATE PLAN PERFORMANCE MEASURE 1.3

The Payments System is in operation and fully functional by developing and implementing NHFB and state and territory policy and procedure manuals, to make payments in accordance with approved directions from authorised persons.

2016–17 Target
Result
Analysis

Ensure the Payments System is in operation and fully functional.

Corporate Plan pg. 14

Met

The Payments System was operational and fully functional throughout the year.

Ensure the Payments System operates in accordance with the National Health Reform Public Hospital Funding State and Territory Procedures Manual and the NHFA Payments System Registration for State and Territory Users documentation.

Corporate Plan pg. 14

Oversee and authorise all payments for public hospital services through the National Health Funding Pool as required under the Agreement.

Improvements to the Payments System allow the NHFB, and states and territories, greater flexibility in managing payments.

PBS pg. 375

Met

All payments through the Funding Pool, and managed by the Payments System were appropriately overseen and authorised by the Administrator.

All payments were made in accordance with the appropriate documentation.

An independent third–party review of the Payments System Internal Control Framework did not find any material weaknesses.

The Administrator and NHFB revised and updated the States and Territories Procedures Manual.

Percentage of payments made in accordance with directions from the responsible state or territory Minister (100% of payments).

PBS pg. 375

Met

All payments were made in accordance with directions from the responsible Minister.

OBJECTIVE TWO: PROVIDE INCREASED TRANSPARENCY AND EFFECTIVE REPORTING

To provide increased transparency and effective reporting on LHN funding for services delivered to the community.

ANALYSIS OF PERFORMANCE

All performance measures for Objective Two were met by the NHFB in 2016–17.

The publication of Monthly Reports at the national, state and territory and local hospital network (LHN) level contributed to key national health reform objectives, including improving the transparency, accountability and informing the sustainabilityof public hospital funding. The Monthly Reports detail the funding into and out of the State Pool Accounts and State Managed Funds. Consistent reporting enables comparison over multiple financial years.

Monthly reports were collated for the financial year in the Administrator’s Annual Report.

As required by the Act, the 2015–16 Annual Report was provided to all Health Ministers on 31 October 2016, and tabled by the responsible Minister in their respective Parliament.

CHALLENGES

Timely data submission by all states and territories remained a challenge. The NHFB aspires to publish the monthly reports within six weeks of the end of the month. However, delays due to jurisdictional and NHFB verification processes resulted inan average time to publication of approximately 8.5 weeks in 2016–17.

THE YEAR AHEAD

In 2017–18, the NHFB will continue to publish monthly reports on funding and payments to LHNs and other parties. A redesign of the Administrator’s website and the monthly reports is planned, aiming to increase the transparency and effectivenessof reporting.

CORPORATE PLAN PERFORMANCE MEASURE 2.1

Prepare and publish:

  • National, state and territory and LHN national health reform Public Hospital Funding reports on the publichospitalfunding.gov.au website
  • Administrator’s Annual Report (including a Report of Operations and Financial Statements)
2016–17 Target
Result
Analysis

Publish on the publichospitalfunding.gov.au website:

  • National, state and territory and LHN Monthly Reports detailing the month and year–to–date funding into and payments out of the Funding Pool, and the number of hospital services funded
    (PBS pg. 376)
  • Compliance Reports detailing Commonwealth, state and territory compliance with the data requirements specified in the Administrator’s Three Year Data Plan
  • The Administrator’s Annual Report
    (PBS pg. 376)

Corporate Plan pg. 15

Maintain proper records and reporting in relation to the administration of the National Health Funding Pool, including records of all payments made to and from those accounts, and the basis on which the payments were made.

PBS pg. 375

Met

1,788 monthly reports were published on the publichospitalfunding.gov.au website in respect of 2016–17. Reports were prepared at the national, state and LHN level, detailing thefunding and payments for public hospital services, and the number of hospital services funded under Activity Based Funding.

Quarterly Compliance Reports were published on the publichospitalfunding.gov.au website in September 2016, December 2016, February 2017 and June 2017.

The Administrator’s Annual Report was published on the publichospitalfunding.gov.au website on 31 October 2016.

CORPORATE PLAN PERFORMANCE MEASURE 2.2

Table the Administrator’s Annual Report in the Commonwealth Parliament by 31 October 2016, and provide it to each state and territory Health Minister for tabling in their respective Parliaments.

2016–17 Target
Result
Analysis

Ensure the Administrator’s Annual Report is tabled in the Commonwealth Parliament and is presented to every state and territory Health Minister for tabling in their respective Parliaments.

Corporate Plan pg. 15

PBS pg. 376

Met

The Administrator’s 2015–16 Annual Report was tabled in the Commonwealth Parliament on 31 October 2016 and published on the Administrator’s website.

The Annual Report was provided to each state and territory Health Minister on 31 October 2016.

The Annual Report included a report on operations, combined financial statements for the Funding Pool, and financial statements each State or Territory state pool account audited by the respective Auditor–General. Thesereports provide detailed information on the national health reform funding and payment flows at the national, state and territory and individual LHN level.

OBJECTIVE THREE: ENABLE ACCURATE COMMONWEALTH CONTRIBUTION CALCULATIONS

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

ANALYSIS OF PERFORMANCE

Measures for Objective Three relating to the accuracy of the calculation of the Commonwealth national health reform funding were met by the NHFB in 2016–17.

The NHFB developed the 2016–17 Commonwealth Contribution Model (CCM) to enable the Administrator to advise the Commonwealth Treasurer on public hospital funding. In line with the NHFB’s Integrity Framework, the calculation was subject to bothinternal and external assurance reviews. This provided confidence in the Administrator’s calculations for all governments.

Upon a request from Australian Health Ministers’ Advisory Council (AHMAC), the NHFB commenced a pilot with the Commonwealth Department of Health to assess the use of the Administrator’s hospital activity data matched with Medicare Benefits Schedule
(MBS) claims. The Department of Health will use the data to inform future compliance activities, including the recovery of duplicate payments.

CHALLENGES

Following a request from the Commonwealth Treasurer on the underlying drivers of growth in the Commonwealth contribution to public hospital services in 2015–16, the NHFB undertook a detailed review of actual activity data and the impact on fundingoutcomes. Annual 2015–16 Reconciliation of actual services was not effected in 2016–17 payments, as the Commonwealth Treasurer’s Determination 2015–16 was not made in 2016–17.3

3 Under the Federal Financial Relations Act, the Commonwealth Treasurer issues the Federal Financial Relations (National Health Reform Payments) Determination. Payment of Reconciliation outcomes is enabled following the issuance of this Determination.

THE YEAR AHEAD

In 2017–18, the NHFB will implement the Addendum requirements into the calculation of Commonwealth national health reform funding. This includes incorporating the Soft Cap and National Funding Cap, Safety and Quality Adjustment, and Data CompliancePayment. The NHFB will continue to work closely with the Commonwealth, states and territories to improve data integrity. The joint pilot with the Commonwealth Department of Health will also be progressed in 2017–18.

CORPORATE PLAN PERFORMANCE MEASURE 3.1

Accurately calculate the Commonwealth contribution for activity based, block and public health funding to LHNs, based on National Efficient Price and National Efficient Cost funding criteria developed by the Independent Hospital Pricing Authority
(IHPA).

2016–17 Target
Result
Analysis

Build, test and implement nationally consistent CCM to calculate the Commonwealth funding contribution to LHNs for delivering public hospital services.

Corporate Plan pg. 15

Met

The CCM was developed and subjected to both internal and external quality assurance for 2016–17 calculations.

Develop and implement CCM Integrity Framework to support the CCM operations and to ensure accuracy of the calculations.

Corporate Plan pg. 15

Met

The CCM Integrity Framework was implemented to ensure the accuracy of CCM operations and calculations. All CCM calculations were in line with the framework.

Update the CCM and the CCM Integrity Framework to include and implement the requirements of the Heads of Agreement.

Corporate Plan pg. 16

Met

The CCM and CCM Integrity Framework were updated to include the requirements of the Addendum.

Development of the CCM in SAS commenced. Transitioning to the SAS platform was driven by the additional complexity of the Addendum requirements, including; the Funding Cap, Data Conditional Payment and options for the Safetyand Quality Adjustment, and overall improvement of calculation integrity.

Assist jurisdictions to inform and develop effective and efficient hospital funding arrangement/mechanisms by undertaking analysis and scenario modelling.

Corporate Plan pg. 16

Met

The NHFB provided financial modelling advice to the Commonwealth, states and territories as requested.

The NHFB undertook detailed financial modelling of policy proposals and scenarios in the Addendum (eg the Funding Cap). This informed Addendum negotiations between the Commonwealth, states and territories.

CORPORATE PLAN PERFORMANCE MEASURE 3.2

Provide accurate and timely advice to the Commonwealth Treasurer on the Commonwealth funding to be paid to each LHN for delivery of public hospital services.

2016–17 Target
Result
Analysis

Provide timely and accurate advice to the Commonwealth Treasurer on the funding to be paid to LHNs for delivery of public hospital services.

Corporate Plan pg. 16

PBS pg. 374

Met

Payment advice was provided to the Commonwealth Treasurer six times in respect of 2016–17.

Additional advice was provided to the Treasurer for the:

  • 2015–16 Determination of Commonwealth national health reform funding
  • 2016–17 Mid–Year Economic and Fiscal Outlook
  • 2017–18 Commonwealth Budget
  • initial 2017–18 Commonwealth contribution calculation.

CORPORATE PLAN PERFORMANCE MEASURE 3.3

Receive unqualified audit opinion for each state and territory Funding Pool account from the respective Auditor–General.

2016–17 Target
Result
Analysis

Develop Funding Pool financial statements for audit by the respective state and territory Auditor–General.

Corporate Plan pg. 16

Met

The 2016–17 Funding Pool account financial statements for each state and territory received an unmodified audit report by the respective state and territory Auditors–General. The 2015–16 Funding Pool financial statementsalso received unqualified audits. Receiving unmodified audit reports from all Auditors–General demonstrated effective administration and transparent reporting of public hospital funding by the NHFB.

CORPORATE PLAN PERFORMANCE MEASURE 3.4

Conduct reconciliation of actual ABF activity to estimated activity and incorporate the adjustments into Commonwealth payments to LHNs.

2016–17 Target
Result
Analysis

Complete the reconciliation of actual ABF activity to estimates and incorporate the funding adjustments into the Commonwealth contribution payments.

Corporate Plan pg. 15

Partially met

Reconciliation of actual 2015–16 hospital activity data to estimated activity was completed, for both the six–month (July 2015 to December 2015) and annual (July 2015 to June 2016) Reconciliations. Reconciliation advicewas provided to the Commonwealth Treasurer.

Annual 2015–16 Reconciliation of actual services was not incorporated in 2016–17 payments, as the Commonwealth Treasurer’s Determination 2015–16 was not made in 2016–17.

Provide reconciled hospital activity data to states and territories to inform national cross–border arrangements and funding flows.

Corporate Plan pg. 16

Met

Reconciled cross–border hospital activity data was provided to states and territories.

CORPORATE PLAN PERFORMANCE MEASURE 3.5

Conduct funding integrity analysis to identify and report on public hospital services that received both Commonwealth national health reform funding and funding through other Commonwealth programs.

2016–17 Target
Result
Analysis

Undertake funding integrity analysis (data matching) of hospital activity and MBS/Pharmaceutical Benefits Scheme/other Commonwealth programs data to identify, report on and remove any instances of ‘double funding’ which may have occurred.

Corporate Plan pg. 16

Partially met

AHMAC requested the NHFB and Department of Health investigate an alternative approach to funding integrity. Work on a pilot project to investigate use of the Administrator’s dataset for MBS compliance commenced in 2016–17.

Data matching for 2014–15 was not completed, due to the additional deliverables undertaken to support the development and implementation of the Addendum.

Supply the data elements related to the instances of ‘double funding’ to states and territories for review.

Corporate Plan pg. 16

Not met

Not supplied due to data matching for 2014–15 activity not being completed. This work will be undertaken during 2017–18.

Improve hospital data integrity by leading a national community of practice to share information and examples of good practice.

Corporate Plan pg. 16

Met

The Administrator’s Jurisdictional Advisory Committee (JAC) discussed hospital data integrity initiatives at three meetings.

Update the Business Rules Volume 2 — Extended Proof of Concept document to detail the process for undertaking funding integrity analysis, to identify instances of ‘double funding’ (hospital services that receive funding through NHR and other Commonwealth programs).


Corporate Plan pg. 16

Not met

The Business Rules Volume 2 — Extended Proof of Concept document will be updated in 2017–18.

OBJECTIVE FOUR: DEVELOP PRODUCTIVE AND EFFECTIVE PARTNERSHIPS

To develop productive and effective partnerships with relevant stakeholders to enable the objectives of the Agreement to be achieved.

ANALYSIS OF PERFORMANCE

Performance measures for Objective Four were largely met by the NHFB in 2016–17.

The NHFB engaged with stakeholders through its internal and external committees. The NHFB committees — Jurisdictional Advisory Committee (JAC) and Chief Finance Officer/Reconciliation Advisory Group (CFO/RAG) — met six times in 2016–17.Two combined workshops on proposals for the Addendum, held in Adelaide in August 2016 and Darwin in February 2017, were attended by officials from the Commonwealth, states and territories.

Productive partnerships with other national health bodies and committees continued in 2016–17. The NHFB participated in the National Health Information and Performance Principal Committee (NHIPPC) and National Health Information Standards andStatistics Committee (NHISSC). This included working with NHIPPC and AHMAC on data matching for funding integrity and use of the Administrator’s data holdings.

As the Agreement transitions into a new phase, the NHFB’s partnership with the IHPA is more important than ever. The NHFB jointly led a workshop with the IHPA on improving the process for states and territories providing estimates of activity. Additionalwork on improving estimates will occur in 2017–18.

CHALLENGES

Significant stakeholder engagement occurred in 2016–17, particularly in the formation of advice to senior officials to inform COAG negotiations. However, this placed resourcing pressure on the NHFB. Reprioritisation of resources meant deliveryof the Stakeholder Engagement Plan was delayed.

THE YEAR AHEAD

In 2017–18, the NHFB will promote interjurisdictional relationships as the implementation of the Addendum progresses. The NHFB will provide advice to governments as the development of post–2020 national health funding arrangements commence.In conjunction with the Administrator’s JAC, the NHFB will finalise the Stakeholder Engagement Plan.

CORPORATE PLAN PERFORMANCE MEASURE 4.1

A Stakeholder Engagement Plan, informed by NHFB policy principles and developed in conjunction with stakeholders, is in place.

2016–17 Target
Result
Analysis

Undertake stakeholder engagement to inform the NHFB work plan.

Corporate Plan pg. 16

Met

Significant stakeholder engagement occurred in 2016–17, with the Administrator and NHFB CEO meeting with most Health Ministers, and Health Department Chief Executives and senior officials.

The NHFB held constructive meetings with states and territories in July and August 2016. Feedback provided was incorporated into NHFB processes.

Develop and implement a Stakeholder Engagement Plan.

Corporate Plan pg. 16

Partially met

Reprioritisation of resources meant delivery of the Stakeholder Engagement Plan was delayed. However, significant stakeholder engagement occurred in 2016–17, particularly in the formation of advice to senior officials to informCOAG negotiations.

CORPORATE PLAN PERFORMANCE MEASURE 4.2

Networks and partnerships are maintained through working groups, advisory committees and other mechanisms.

2016–17 Target
Result
Analysis

Convene Administrator’s JAC and NHFB CFO/RAG meetings and workshops to communicate strategies and develop networks.

Corporate Plan pg. 16

Met

The JAC and CFO/RAG met six times in 2016–17, including two combined workshops in August 2016 and February 2017. Attendees indicated the forums were a valuable opportunity to partner with the NHFB, Commonwealth, states and territories.

Report to and/or engage with:

  • Council of Australian Governments
  • COAG Health Council
  • Australian Health Ministers’ Advisory Council
  • National Health Information and Performance Principal Committee
  • National Health Information Standards and Statistics Committee
  • IHPA Jurisdictional Advisory Committee and Technical Advisory Committee
  • Data Governance Council.

Corporate Plan pg. 16–17

Met

The Administrator and NHFB provided advice on public hospital funding to COAG through their committees and the Addendum to the Agreement Deputy Senior Officials Working Group.

The COAG Health Council reviewed the Administrator’s
Three Year Data Plan.

The NHFB engaged with AHMAC on the Administrator’s
Three Year Data Plan and proposals for use of the Administrator’s deterministically–linked dataset.

NHFB officials participated in NHIPPC, NHISSC, IHPA JAC and IHPA TAC meetings in 2016–17.

The NHFB and IHPA collaborated on workshops on national data flow arrangements and improving the process for states and territories providing estimates of activity.

The NHFB CEO was a member of the Commonwealth Health Data Governance Council until it was disbanded in November 2016.

Present at:

  • IHPA Activity Based Funding (ABF) Conference
  • ACHSM/ACHS Joint 2016 Asia–Pacific Annual Congress
  • Data Analytics for Effective Management Decision Making Conference.

Corporate Plan pg. 17

Met

NHFB officials presented at the Data Analytics for Effective Management Decision Making Conference (July 2016) and the ACHSM/ACHS Joint 2016 Asia–Pacific Annual Congress (October 2016).

The IHPA ABF Conference was not held in the 2016–17 year.

OBJECTIVE FIVE: OPERATE AS A FULLY FUNCTIONAL AND COMPLIANT AGENCY

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

ANALYSIS OF PERFORMANCE

All performance measures for Objective Five were met by the NHFB in 2016–17.

All compliance requirements were met in 2016–17. This continued the trend of previous years, and provides confidence in the NHFB’s governance and assurance processes.

Significant work was undertaken in human resource development for the NHFB. Importantly, an Enterprise Agreement was negotiated and approved with staff.

A Human Resources Workforce Capability Framework was developed, to be in place from 1 July 2017 to 30 June 2020. This Framework assists with securing NHFB capacity over the coming period, as well as ensuring agency compliance with Commonwealth legislation.

In 2015–16 the NHFB financial statements received an unqualified audit opinion.

The NHFB is a fully functional and compliant agency, continuing to achieve its purpose of successfully supporting the Administrator.

CHALLENGES

The introduction of the Addendum required substantial investment in reviewing forward work programs and resourcing requirements. This enabled the NHFB to drive the implementation of the Addendum in partnership with the Commonwealth, states and territories.

THE YEAR AHEAD

In 2017–18, the NHFB will commence implementation of the Human Resources Workforce Capability Framework. Further work will be undertaken to meet the requirements of the Digital Continuity 2020 Policy, including implementation of the Roadmapdeveloped in 2016–17.Given the expanded role of the Administrator and NHFB under the Addendum, there will be a focus on risk management to ensure the NHFB meets all its obligations.

CORPORATE PLAN PERFORMANCE MEASURE 5.1

An Enterprise Agreement is in place.

2016–17 Target
Result
Analysis

Negotiate and implement an Enterprise Agreement with staff.

Corporate Plan pg. 17

Met

The NHFB Enterprise Agreement was agreed by staff and approved by the Fair Work Commission on 19 October 2016 — effective from 26 October 2016 to 25 October 2019.

CORPORATE PLAN PERFORMANCE MEASURE 5.2

Employ a Human Resources Workforce Capability Framework to enable the development of workforce capability and capacity to ensure compliance with Commonwealth legislation and regulations.

2016–17 Target
Result
Analysis

Develop and implement a Workforce Capability Framework.

Corporate Plan pg. 17

Met

The three year Workforce Capability Framework was fully developed, and partially implemented in 2016–17. This will assist the NHFB in transitioning from basic workforce management (eg headcount and full–time equivalent)to strategic planning.

Workforce planning helps the NHFB to proactively identify and anticipate change, identify the important issues driving change, and enables appropriate strategic and operational responses.

CORPORATE PLAN PERFORMANCE MEASURE 5.3

Document the NHFB approach to meeting the requirements under the Digital Continuity 2020 Policy.

2016–17 Target
Result
Analysis

Map the NHFB work program to meet the legislative requirements of the Digital Continuity 2020 Policy.

Corporate Plan pg. 17

Met

The NHFB formed an Information Governance Committee to ensure the NHFB meets the legislative requirements of the whole–of–government Digital 2020 Policy. The Committee developed a number of documents and a Roadmap to achievingdigital compliance.

CORPORATE PLAN PERFORMANCE MEASURE 5.4

Meet the NHFB compliance reporting obligations.

2016–17 Target
Result
Analysis

Meet requirements for compliance reporting.

Corporate Plan pg. 17

Met

The NHFB met all compliance and reporting requirements under various whole–of–government policies. In 2016–17 this included:

  • APS Remuneration Survey
  • Check Up Digital
  • Comcover Renewal Questionnaire
  • Comcover Risk Management Benchmarking Survey
  • Fraud Reporting
  • Murray–Grants Reporting
  • Murray Reporting
  • Harradine Reporting
  • Legal Reporting
  • PGPA Reporting
  • Protective Security Policy Framework Reporting
  • Public Interest Disclosure Reporting

CORPORATE PLAN PERFORMANCE MEASURE 5.5

Unqualified NHFB financial statements.

2016–17 Target
Result
Analysis

Apply requirements of the PGPA Act and all relevant government and professional accounting pronouncements.

Corporate Plan pg. 17

Met

The NHFB 2015–16 Financial Statements applied all relevant requirements, and received an unqualified audit opinion from the Australian National Audit Office (ANAO).

SUMMARY OF PERFORMANCE 2013–2017

Five high–level strategic objectives were adopted for 2013–2017. The NHFB’s achievement against these objectives from 2013 to 2017 is described below.

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STRATEGIC OBJECTIVE ONE

ACHIEVES BEST PRACTICE AND ACCOUNTABILITY

Leadership and expert policy advice was provided to the Administrator and governments on national health reform funding. Efficient and robust processes were put in place to ensure all payments through the Funding Pool were accurate. This includedthe development of policies, procedures and frameworks to ensure compliance.

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STRATEGIC OBJECTIVE TWO

PROVIDE INCREASED TRANSPARENCY AND EFFECTIVE REPORTING

All monthly reporting requirements were achieved, with data requirements determined and communicated in advance of each financial year. Monthly reports were published on the Administrator’s website, along with the Administrator’s Annual Report eachyear.

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STRATEGIC OBJECTIVE THREE

ENABLE ACCURATE COMMONWEALTH CONTRIBUTION CALCULATIONS

The Commonwealth contribution was calculated accurately based on activity and advised to the Commonwealth Treasurer in a timely manner. The rolling Administrator’s Three Year Data Plan was developed each year in adherence with data integrity and privacy provisions. A robust Reconciliation Framework was implemented, with annual updates.

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STRATEGIC OBJECTIVE FOUR

DEVELOP PRODUCTIVE AND EFFECTIVE PARTNERSHIPS

Networks were developed through JAC, CFO/RAG and other national committees. The Administrator and NHFB’s work plan was informed by consultation with JAC and senior health officials. Awareness of the national health reform funding agenda was promotedthrough conference presentations and meetings with stakeholders. A communication strategy was not developed, but the Stakeholder Engagement Plan was largely completed.

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STRATEGIC OBJECTIVE FIVE

OPERATE AS A FULLY FUNCTIONAL AND COMPLIANT AGENCY

The NHFB put in place an appropriate structure and financial and human resources delegations. An Enterprise Agreement was negotiated with staff. Frameworks for ensuring compliance were implemented, including fraud control, risk and assurance, internalcontrol and business continuity. The workplace culture encourages high performance, integrity and commitment to success. The NHFB developed a planning and reporting schedule that complies with the enhanced Commonwealth Performance Framework, includingAnnual Reports. A Workforce Capability Framework was developed to enable strategic workforce planning.