25   Tasmanian Health Service

AUTHORITY OUTLINE

The Tasmanian Health Service (THS) commenced operation on 1 July 2015. The THS is a separate legal entity under the Tasmanian Health Organisation Act 2011 (the Act) and is governed by the requirements of this Act.

The THS features a Governing Council, comprising a chairperson and skills based members with a spread of regional representation, and a CEO supported by local managers to coordinate statewide services at the local level.

The THS is responsible for delivering integrated services aimed at maintaining and improving the health and wellbeing of Tasmanians. Under the Act, the responsible Ministers are the Minister for Health, Hon Michael Ferguson MP, and the Treasurer, Hon Peter Gutwein MP.

The functions of the THS include:

·       improving, promoting, protecting and maintaining the health of Tasmanians as required by its Service Agreement;

·       managing public hospitals, health institutions, health services and health support services;

·       achieving and maintaining standards of patient care and delivery of services;

·       providing training and education relevant to the provision of health services;

·       undertaking research and development relevant to the provision of health services; and

·       collecting and providing health data for reporting and research purposes.

In addition to these functions, the THS is responsible for the implementation of the Tasmanian Clinical Services Profile and will drive decisions about services that are in the best interests of Tasmania as a whole.

Funding for the THS is provided by both the State and Australian Governments. All Australian Government and State Activity Based Funding (ABF) flows through the National Health Funding Pool, which is overseen by an independent statutory office holder known as the Administrator. Block funding for some activities is paid to the THS via a State‑managed Fund. In addition to State and Australian Government funding, the THS also generates its own revenue to fund some of its activities.

This chapter provides financial information for 2016‑17 and over the Forward Estimates period (2017‑18 to 2019‑20) for the THS.


 

Key Deliverables

Table 25.1 provides a summary of the Budget and Forward Estimates allocations for key deliverables within the THS.

Table 25.1:        Key Deliverables Statement

 

2016‑17

 

Budget

2017‑18

Forward

Estimate

2018‑19

Forward

Estimate

2019‑20

Forward

Estimate

 

$'000

$'000

$'000

$'000

Minister for Health

 

 

 

 

 

 

 

 

 

Hospital Alternative Program

1 450

1 000

….

….

North West Regional Cancer Centre

3 800

4 100

4 500

4 500

Nurse Graduates ‑ Additional Transition to Practice Placements

1 260

2 610

....

….

One Health System ‑ Additional Investment

8 000

7 500

7 000

7 000

Patients First

1 000

1 000

1 000

1 000

Rebuilding Health Services ‑ Elective Surgery Program

20 000

20 000

….

….

 

 

 

 

 

Hospital Alternative Program

This 2014 election commitment provided funding of $3 million to help keep people with chronic/complex illness out of hospital, by providing them with quality care in the community. Initiatives under this program will be implemented as part of the One Health System reforms.

As a component of this funding allocation, a proof of concept trial of a Community Rapid Response Service in the Launceston area commenced during 2015‑16. The Service provides treatment for people who need short‑term intermediate care that can be safely delivered in the community in partnership with their GP. The service is targeted at people with acute illness or whose chronic/complex condition has deteriorated, which would otherwise see them presented at an emergency department and, ultimately, admitted to hospital.

North West Regional Cancer Centre

The North West Regional Cancer Centre opened during 2015‑16 as part of the Statewide Cancer Project. Additional funding was provided in the 2015‑16 Budget for the operating costs associated with the North West component of the Northern Integrated Cancer Service.

Under the Northern Integrated Cancer Service, the North West Regional Cancer Centre in Burnie and Holman Clinic in Launceston will work closely together to provide improved services across the North and North West of the State. Through the development of a critical mass of specialists, the new linear accelerator will be opened and operated at the North West Regional Hospital to provide radiation oncology treatment to cancer sufferers.

The Budget funding allocations have been adjusted to reflect a revised service profile, with the North West Cancer Centre now envisaged to be fully operational earlier than previously anticipated.

Nurse Graduates ‑ Additional Transition to Practice Placements

This 2014 election commitment provided $5.4 million over four years for additional Transition to Practice Placements for nursing graduates. This will enable the employment of up to 85 additional graduate nurses across the State over four years.

One Health System ‑ Additional Investment

Additional funding of $29.5 million over four years is provided to support One Health System reforms. Investment will be directed to the highest priority service reconfiguration as identified in the White Paper and Clinical Services Profile (CSP) Implementation Plan.

Actions funded under this investment may include:

·       consolidation of clinical services into sites that are equipped and capable of delivering services safely and efficiently;

·       consolidation of all birthing and inpatient maternity services to a single site in the North West;

·       refocusing the Mersey Community Hospital (MCH) towards sub‑acute services and establishing the MCH as an elective surgery centre; and

·       reconfiguration of existing services which will deliver optimal benefits to patients and improve efficiency.

Patients First

Additional funding of $1 million per annum is provided to the THS for the Patients First initiative to support the implementation of actions to ensure patients receive timely care in emergency departments at the Royal Hobart Hospital (RHH) and the Launceston General Hospital. This funding allocation supports the Patients First actions, including:

·       the employment of Clinical Initiative Nurses to actively monitor and provide advice to patients and their families whilst they are in an emergency department waiting room, including developing plans of care for patients in consultation with emergency department doctors; and

·       the continuation of Psychiatric Emergency Nurses (PEN) at the RHH, following the cessation of Australian Government funded PEN positions.

Rebuilding Health Services ‑ Elective Surgery Program

This 2014 election commitment provided $76 million over four years for additional elective surgery with a focus on the reduction of waiting lists. This commitment will improve the quality of life for thousands of Tasmanians by ensuring patients get their operations sooner.


 

Output Information

Outputs of the THS are provided under:

·       Output Group 1 ‑ Tasmanian Health Service.

Table 25.2 provides an Output Group Expense Summary for the THS.

Table 25.2:        Output Group Expense Summary

 

2015‑16)

 

Budget)

2016‑17)

 

Budget)

2017‑18)

Forward)

Estimate)

2018‑19)

Forward)

Estimate)

2019‑20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Minister for Health

 

 

 

 

 

 

 

 

 

 

 

Output Group 1 ‑ Tasmanian Health Service

 

 

 

 

 

1.1  Admitted Services1

 760 331)

 772 698)

 765 352)

 762 657)

 793 870)

1.2  Non‑admitted Services2

 154 239)

 167 534)

 172 481)

 173 109)

 177 324)

1.3  Emergency Department Services3

 122 114)

 115 194)

 115 073)

 116 715)

 119 447)

1.4  Community and Aged Care Services4

 200 907)

 194 407)

 189 461)

 188 987)

 191 327)

1.5  Statewide and Mental Health Services

 116 803)

 116 813)

 118 472)

 121 378)

 123 410)

1.6  Forensic Medicine Service

 1 242)

 1 435)

 1 477)

 1 654)

 1 698)

 

1 355 636)

1 368 081)

1 362 316)

1 364 500)

1 407 076)

 

 

 

 

 

 

TOTAL

1 355 636)

1 368 081)

1 362 316)

1 364 500)

1 407 076)

 

 

 

 

 

 

Notes:

1.   The decrease in Admitted Services in 2017‑18 primarily reflects the completion of various National Partnership Agreements (NPAs) including Improving Health Services in Tasmania ‑ Schedule A ‑ Reforming Elective Surgery in Tasmania; and completion of the Training More Specialist Doctors in Tasmania initiative which was funded by the Australian Government through the medical professional colleges. The decrease in 2018‑19 primarily reflects the completion of the Rebuilding Health Services ‑ Elective Surgery Program. The increase in 2019‑20 reflects the impact of additional depreciation as a result of the transfer of the completed RHH Redevelopment to the THS in 2018‑19.

2.   The increase in Non‑admitted Services primarily reflects updates to revenue and expenditure under the Highly Specialised Drug Program, Private Patient Scheme and research grants.

3.   The decrease in Emergency Department Services primarily reflects the completion of the NPA on Improving Health Services in Tasmania ‑ Schedule E ‑ Improving Patient Pathways through Clinical and System Redesign.

4.   The decreases in Community and Aged Care Services in 2016‑17 and 2017‑18 primarily reflect the completion of NPA and Commonwealth Own Purpose Expenditure (COPE) agreements including Improving Health Services in Tasmania ‑ Schedule D ‑ Better Access to Palliative Care, Adult Public Dental Services and Rural Primary Health Services Program; and cessation of the Child Dental Benefits Schedule. The Australian Government has announced a commitment to the continued funding of dental services beyond 30 June 2016. However, this commitment has not yet been ratified with the states and territories.


 

Output Group 1: Tasmanian Health Service

1.1 Admitted Services

This Output provides admitted acute, sub‑acute and non‑acute inpatient services (elective and non‑elective) provided by Tasmania's major public hospitals to patients either admitted to a ward or in an out‑of‑hospital setting. It excludes designated mental health wards in major public hospitals.

1.2 Non‑admitted Services

This Output provides non‑admitted services, including ambulatory acute and sub‑acute services provided by Tasmania's major public hospitals either on‑site or in an out‑of‑hospital setting. This includes the provision of Cancer Screening Services.

1.3 Emergency Department Services

This Output provides services relating to emergency presentations at Tasmania's major public hospital emergency departments.

1.4 Community and Aged Care Services

This Output comprises rural hospitals, residential aged care and community health based services including:

·       rehabilitation, allied health assessments and case management; and

·       community nursing, continence, orthotics and prosthetics services, and equipment schemes.

In addition, community palliative care services provide interdisciplinary care, support and counselling to people living with life limiting illnesses and their families. These services are provided in a community health centre or home‑based environment.

Emergency and general oral care and dentures to eligible adults (holders of Health Care or Pensioner Concession cards) and all children under the age of 18 years, as well as a range of health promotion and prevention activities are also provided through this Output.

1.5 Statewide and Mental Health Services

This Output provides services to clients and their families to treat, support and manage mental health disorders. The service also provides:

·       crisis assessment and treatment, intensive support, community care and rehabilitation services;

·       primary health care services in correctional facilities;

·       forensic mental health services to people with mental illnesses who have come into contact with the criminal justice system; and

·       alcohol and drug services at the individual and population level.

1.6 Forensic Medicine Services

This Output provides forensic and medical services, forensic pathology and clinical forensic medicine.


 

Table 25.3:        Performance Information1,2

 

Performance Measure

Unit of Measure

2013‑14 Actual

2014‑15 Actual

2015‑16 Target

2016‑17 Target

 

 

 

 

 

 

Admitted Services

 

 

 

 

 

Admitted patients ‑ Acute Admitted Weighted Inlier Units3,4

Number

na

na

 

94 659

 

96 552

Elective surgery patients seen on time5

 

 

 

 

 

Category 16

%

74.3

74.6

90.0

90.0

Category 26

%

49.3

49.4

70.0

70.0

Category 36

%

75.0

72.0

70.0

70.0

Elective surgery patients ‑ average overdue wait time for those waiting beyond the recommended time5

 

 

 

 

 

Category 17

Days

35.8

21.5

24.0

21.5

Category 27

Days

167.1

146.5

157.5

150.0

Category 37

Days

352.2

181.3

132.6

130.0

Elective surgery baseline admissions8

Number

14 670

14 325

14 126

14 126

Hand hygiene compliance9

%

na

77.5

70.0

75.0

Healthcare associated staphylococcus aureus (including MRSA) bacteraemia (rate per 10 000 patient days)10

Rate

na

0.8

2.0

2.0

Cost per weighted separation11

$

5 171

5 419

5 217

5 348

 

 

 

 

 

 

Non‑admitted Services

 

 

 

 

 

Outpatient attendances12

Number

482 870

487 136

492 356

504 665

 

 

 

 

 

 

Emergency Department Services

 

 

 

 

 

Department of Emergency Medicine presentations13

Number

148 405

150 350

155 080

 

159 732

Emergency Department (ED) patients who are admitted, referred for treatment or discharged within four hours14

%

67.5

66.4

 

 

65.4

 

 

65.4

Percentage of all ED patients seen within the recommended triage time14

%

72.8

70.0

 

64.2

 

64.2

 

 

 

 

 

 


 

Table 25.3:        Performance Information1,2 (continued)

 

Performance Measure

Unit of Measure

2013‑14 Actual

2014‑15 Actual

2015‑16 Target

2016‑17 Target

 

 

 

 

 

 

Community and Aged Care15

 

 

 

 

 

Rural hospitals ‑ separations

Number

4 570

4 660

4 700

4 700

Rural hospitals ‑ occupancy rate16

%

na

55.0

55.0

55.0

Community nursing ‑ occasions of service17

Number

208 300

173 027

176 488

180 018

Residential aged care ‑ occupancy rate

%

na

78.0

78.0

78.0

Aged Care Assessment Program ‑ completed assessments18

Number

5 090

4 950

 

5 000

 

4 500

 

 

 

 

 

 

Oral Health Services19

 

 

 

 

 

Adults ‑ occasions of service ‑ general

Number

8 810

15 551

15 390

10 496

Adults ‑ occasions of service ‑ episodic

Number

32 230

32 670

32 461

28 705

Adults ‑ occasions of service ‑ dentures

Number

15 145

18 933

19 925

15 041

Children ‑ occasions of service

Number

64 485

66 239

65 730

63 975

General (adults) waiting list

Number

14 615

9 246

7 618

7 230

Dentures waiting list

Number

1 455

819

791

1 137

 

 

 

 

 

 

Mental Health and Alcohol and Drug Services20

 

 

 

 

 

Inpatient Separations

Number

2 020

2 090

2 136

2 136

Community and Residential ‑ active clients

Number

7 665

7 845

7 665

7 800

28 day readmission rate21

%

13.5

16.4

14.7

14.7

Proportion of persons with a mental illness whose needs are met by the Tasmanian Mental Health Service22

%

54.7

na

 

 

50.4

 

 

51.0

Average length of acute inpatient stay

Days

12.6

10.2

11.0

11.0

Alcohol and Drug Services

 

 

 

 

 

Alcohol and Drug Services ‑ closed episodes of treatment

Number

1 780

1 821

 

1 821

 

1 821

Pharmacotherapy Program ‑ total active participants

Number

840

931

931

931

Withdrawal Unit ‑ bed occupancy

%

49.7

48.8

50.0

50.0

Withdrawal Unit ‑ average length of stay

Days

7.0

6.3

7.0

7.0

 

 

 

 

 

 

Cancer Screening

 

 

 

 

 

Eligible women screened for breast cancer23

Number

29 236

30 482

30 990

32 010

BreastScreen ‑ percentage of clients assessed within 28 days of screening

%

94.2

90.4

90.0

 

90.0

 

 

 

 

 

 


 

Notes:

1.   Actual performance prior to 1 July 2015 is provided for illustrative purposes only, and details either weighted aggregates of the performance of THOs or aggregates of previously reported performance information. The 2013‑14 actual data has been updated where more accurate information is now available. Previously published targets have been updated in some instances to reflect current projections and 2014‑15 actual outcomes. Refer to prior year Budget Papers for information on individual THO performance.

2.   The 2016‑17 THS Service Agreement had not been finalised at the time of preparation of the State Budget. Targets in the Service Agreement may therefore differ from those in this table.

3.   Acute Admitted Inlier Weighted Units are consistent with the 2015‑16 THS Service Agreement Key Performance Indicator Data Definition. The 2015‑16 target has been updated from the prior Budget, and is projected from year‑to‑date coded data (January). The 2016‑17 target is based on annual growth of approximately 2 per cent from the 2015‑16 target.

4.   From 2015‑16, the targets are based on Inlier Weighted Units. Comparison with prior years is not possible, with actuals and targets based on Weighted Separations.

5.   This indicator excludes additional activity funded under the NPA Improving Health Services in Tasmania – Schedule A ‑ Reforming Elective Surgery and Rebuilding Health Services ‑ Elective Surgery Program.

6.   The 2015‑16 targets have been updated and are derived from the 2015‑16 Service Agreement.

7.   The 2015‑16 targets have been updated based on actual data as at 31 March 2016.

8.   This indicator excludes additional activity funded under the NPA Improving Health Services in Tasmania ‑ Schedule A ‑ Reforming Elective Surgery and Rebuilding Health Services ‑ Elective Surgery Program. The 2015‑16 target is derived from the 2015‑16 THS Service Agreement.

9.   The 2015‑16 target represents the interim national benchmark recommended by the Australian Commission on Safety and Quality in Healthcare.

10. The 2015‑16 and 2016‑17 targets represent the national threshold detailed in the National Healthcare Agreement.

11. The 2015‑16 and 2016‑17 targets have been updated and are based on the Round 18 National Hospital Cost Data Collection results.

12. The 2016‑17 target for outpatient attendances has been amended and is projected based on annual growth of approximately 2.5 per cent from projected 2015‑16 activity.

13. The 2016‑17 target for Department of Emergency Medicine presentations has been amended and is based on annual growth of approximately 3 per cent from projected 2015‑16 activity.

14. The 2015‑16 target has been updated and is based on actual data as at 31 March 2016.

15. Targets are based on historical trends.

16. Occupancy is an average for all facilities and calculated from 'beds occupied daily average'. Improving the utilisation of rural hospitals is a key action of the Government's Patients First initiative and the target for this measure will be reviewed as this policy is implemented.

17. The reduction in occasions of service from 2013‑14 is the result of more accurate data from the implementation of the iPatient Manager (iPM) community program and referrals being directed to other more appropriate community services. Targets have been updated and are based on projections of current data and reflect 2 per cent growth each year.

18. Actuals are sourced from Aged Care Assessment Team (ACAT) data. Targets are projected from year‑to‑date results and indicate a downwards trend in assessments due to a range of factors, including ongoing changes to the Australian Government aged care system.

19. Australian Government funding has been provided under the NPA Treating More Public Dental Patients and the Child Dental Benefits Scheme (CDBS). The Australian Government has announced a commitment to the continued funding of dental services beyond 30 June 2016. However, this commitment has not yet been ratified with the states and territories. Accordingly, the 2016‑17 targets do not reflect the Australian Government proposed new funding arrangements. The 2015‑16 targets have been revised to reflect activity completed to 29 February 2016 and projected to 30 June 2016.

20. Targets are based on historical trends, and have been updated in some instances.

21. The 2016‑17 target is based on the national average.

22. This indicator is based on the estimated 3 per cent of the Tasmanian population with severe mental illness.

23. The 2016‑17 target is the sum of the targets for: (a) the 40‑69 years and 75+ years age groups; and (b) the 70‑74 age group. The target for (a) is a 6 per cent growth in the 2014‑15 attendance figure, reflecting growth in the demographic. The target for (b) is based on meeting Australian Government performance expectations.


 

Performance Information Comments

Sections 44 and 45 of the Act detail the provisions for the Service Agreement, the key mechanism of accountability between the Minister for Health and the THS.

The Service Agreement includes:

·       a schedule of services to be provided by or on behalf of the THS and the funding to be provided in relation to the provision of those services;

·       performance standards, targets and measures;

·       standards of patient care and service delivery;

·       reporting requirements; and

·       a performance management process.

The 2016‑17 Service Agreement will be finalised following the delivery of the State Budget.

THS performance in relation to the Service Agreement targets will be monitored by the Department of Health and Human Services throughout 2016‑17.

Performance monitoring through the Service Agreement process focuses on improving the efficiency and effectiveness of service delivery, and the safety and quality of care.


 

Detailed Budget Statements

Table 25.4:        Statement of Comprehensive Income

 

2015‑16)

 

Budget)

2016‑17)

 

Budget)

2017‑18)

Forward)

Estimate)

2018‑19)

Forward)

Estimate)

2019‑20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Revenue and other income from transactions

 

 

 

 

 

Grants1

1 459 909)

1 160 953)

1 196 348)

1 742 264)

1 187 830)

Sales of goods and services

 138 458)

 140 275)

 145 096)

 148 191)

 149 487)

Interest2

....)

  302)

  329)

  435)

  496)

Other revenue3

 29 276)

 30 642)

 25 987)

 26 013)

 25 437)

Total revenue and other income from transactions

1 627 643)

1 332 172)

1 367 760)

1 916 903)

1 363 250)

 

 

 

 

 

 

Expenses from transactions

 

 

 

 

 

Employee benefits4

 922 096)

 933 086)

 929 329)

 940 400)

 965 890)

Depreciation and amortisation5

 37 536)

 39 536)

 40 709)

 33 684)

 43 148)

Supplies and consumables6

 345 162)

 368 281)

 363 961)

 361 008)

 367 599)

Grants and subsidies7

 40 495)

 7 494)

 7 665)

 8 534)

 9 034)

Borrowing costs8

  192)

....)

....)

....)

....)

Other expenses9

 10 155)

 19 684)

 20 652)

 20 874)

 21 405)

Total expenses from transactions

1 355 636)

1 368 081)

1 362 316)

1 364 500)

1 407 076)

 

 

 

 

 

 

Net result from transactions (net operating balance)

 272 007)

(35 909)

 5 444)

 552 403)

(43 826)

 

 

 

 

 

 

Net result

 272 007)

(35 909)

 5 444)

 552 403)

(43 826)

 

 

 

 

 

 

Other economic flows ‑ other non‑owner changes in equity

 

 

 

 

 

Changes in physical asset revaluation reserve

 45 889)

 48 058)

 49 678)

 52 800)

 78 169)

Total other economic flows ‑ other non‑owner changes in equity

 45 889)

 48 058)

 49 678)

 52 800)

 78 169)

 

 

 

 

 

 

Comprehensive result

 317 896)

 12 149)

 55 122)

 605 203)

 34 343)

 

 

 

 

 

 

 


 

Notes:

1.   The movements in Grants primarily reflect the transfer of completed assets from the Department to the THS, including the RHH Redevelopment in 2018‑19. The Department undertakes capital works on behalf of the THS and transfers these assets to the THS once completed. The decrease in 2016‑17 predominantly reflects the THS budgeting to receive completed components of the RHH Redevelopment in 2015‑16. It is noted that the methodology for the transfer of assets has been altered, and the fully redeveloped RHH is now budgeted to be received in 2018‑19. In addition, estimated revenue from the Australian Government has been adjusted as a result of updates to hospital activity estimates, and the Tasmanian Government has provided additional funding for the One Health System ‑ Additional Investment initiative. The movement in Grants also reflects the impact of NPA funding for Improving Health Services in Tasmania ‑ Schedule A ‑ Reforming Elective Surgery in Tasmania, Adult Public Dental Services, Improving Health Services in Tasmania ‑ Schedule E ‑ Improving Patient Pathways through Clinical and System Redesign and Improving Health Services in Tasmania ‑ Schedule D ‑ Better Access to Palliative Care.

2.   The increase in Interest primarily reflects the recognition of interest earned on Private Patient Scheme balances.

3.   The decrease in Other revenue from 2017‑18 is primarily due to the completion of the Training More Specialist Doctors initiative which was funded by the Australian Government through the medical professional colleges.

4.   The decrease in Employee benefits in 2017‑18 is primarily due to the completion of Australian Government NPA agreements including Improving Health Services in Tasmania Schedule A ‑ Reforming Elective Surgery in Tasmania and Adult Public Dental Services; and the completion of the Training More Specialist Doctors initiative.

5.   The movements in Depreciation and amortisation reflect anticipated depreciation schedules for existing and budgeted purchases of non‑financial assets over the Budget and Forward Estimates period, including an increase in 2019‑20 as a result of additional depreciation associated with the completed RHH Redevelopment project.

6.   The increase in Supplies and consumables primarily reflects additional expenditure for Highly Specialised Drugs, Information Technology and Maintenance. The increase in 2016‑17 is partially offset by a reallocation of the Tasmanian Risk Management Fund premium to Other expenses in accordance with prior year actuals. The decreases in Supplies and consumables in 2017‑18 and 2018‑19 relate to various State and Australian Government programs being completed in preceding years.

7.   The decrease in Grants and subsidies reflects the expenditure of the Cross Border payments to other jurisdictions for 2013‑14 and 2014‑15, which was previously carried forward into 2015‑16.

8.   The decrease in Borrowing costs reflects the repayment of borrowings through the Department in 2015‑16, which were provided to fund the cost of staff separations in the THOs in 2014‑15.

9.   The increase in Other expenses reflects the reallocation from Supplies and Consumables of the insurance premium paid into the Tasmanian Risk Management Fund. This reallocation aligns the expenditure item with the prior year actuals.


 

Table 25.5:        Sources of Revenue

 

2015‑16

Budget

2016‑17

Budget

2017‑18
Forward Estimate

2018‑19
Forward Estimate

2019‑20
Forward Estimate

 

$'000

$'000

$'000

$'000

$'000

 

 

 

 

 

 

Revenue from the Tasmanian Government

 

 

 

 

 

Activity based funding1

 345 877

 363 118

 373 141

 359 023

 367 799

Block funding

 304 059

 309 829

 318 176

 326 181

 334 101

 

 649 936

 672 947

 691 317

 685 204

 701 900

 

Revenue from the Australian Government

Activity based funding2

 261 709

 293 755

 301 102

 308 629

 316 345

Block funding

 58 548

 57 378

 58 880

 60 417

 61 901

Mersey Community Hospital funding

 72 274

 75 500

 77 388

 79 413

 81 201

National Partnership funding3

 47 118

 25 404

 1 850

....

....

Commonwealth Own Purpose Expenditure4

 34 124

 30 917

 28 311

 28 401

 26 483

 

 473 773

 482 954

 467 531

 476 860

 485 930

 

Transfers of Infrastructure from the Department of Health and Human Services5

 336 200

 5 052

 37 500

 580 200

....

 

 

 

 

 

 

Other Sources of Revenue6

 167 734

 171 219

 171 412

 174 639

 175 420

 

Total

1 627 643

1 332 172

1 367 760

1 916 903

1 363 250

 

 

 

 

 

 

Notes:

1.   The decrease in Activity based funding from the Tasmanian Government in 2018‑19 reflects the cessation of fixed term funding for 2014 election commitments.

2.   The increase in Activity based funding from the Australian Government from 2016‑17 primarily reflects updates to estimated hospital activity following a review of actual activity achieved in 2014‑15 and anticipated activity in 2015‑16, and a minor reallocation between ABF and Block funding categories.

3.   The decrease in National Partnership funding reflects the level of funding for current National Partnership Agreements with the Australian Government. NPAs ceasing with respect to the THS include the John L Grove, Elective Surgery and Emergency Department components of the Improving Health Services in Tasmania NPA, and the Adult Public Dental Services NPA.

4.   The decrease in Commonwealth Own Purpose Expenditure reflects the expiration of current agreements.

5.   The variation in Transfers of Infrastructure from the Department of Health and Human Services reflects revisions in the estimated completion dates for major capital projects, and a revised methodology for the transfer of work‑in‑progress for the RHH Redevelopment to the THS.

6.   The increase in Other Sources of Revenue from 2016‑17 reflects revised estimates across a number of funding sources, including Highly Specialised Drugs and Private Patient Scheme estimates.

 

National Health Reform Agreement

The National Health Reform Agreement (NHRA) sets out arrangements for the Tasmanian and Australian Government contributions to the provision of health services in Tasmania as delivered by the THS. Under the NHRA, State and Australian Government funding is provided on the basis of activity through Activity Based Funding (ABF) wherever practicable. Where it is not practical, funding is provided on a block basis.


 

Block funded services include smaller regional or rural hospitals and teaching, training and research. Pricing under the NHRA is determined by the Independent Hospitals Pricing Authority (IHPA).

Revenue from the Tasmanian Government

Activity Based Funding and Block Funding

The State contribution towards the operation and delivery of services is comprised of ABF and Block Funding that is provided from the Government via the Department. The Department purchases hospital activity through an annual THS Service Agreement. The 2016‑17 THS Service Agreement will be in place from 1 July 2016.

Revenue from the Australian Government

Activity Based Funding and Block Funding

Under the NHRA, funding from the Australian Government is split between ABF and Block Funding. From 1 July 2014 to 30 June 2017, National Health Reform funding is linked to the level of services delivered by public hospitals, as provided under the NHRA. During this period, each state's entitlement is directly linked to the growth in public hospital activity. From 2014‑15 the NHRA funding guarantees ceased.

From 1 July 2014, the Australian Government has provided growth funding equivalent to 45 per cent of the efficient growth in both the activity and block funded components of the NHRA. The Independent Hospital Pricing Authority (IHPA) determines the efficient price of ABF and the efficient cost of block grants.

At the Council of Australian Government (COAG) meeting of 1 April 2016, all jurisdictions agreed to extend the current NHRA activity based and block funding arrangements under a Heads of Agreement that will form the basis of negotiation of an addendum to the NHRA for the period from 1 July 2017 to 30 June 2020. This agreement preserves the current arrangement of the Australian Government contributing 45 per cent of the efficient growth in activity based funded services and block grants.

It was also agreed that, where a state may receive less funding under the new arrangements than it would have under the block funding arrangements proposed in the 2014‑15 Australian Government Budget, the Australian Government will work with the state to consider whether there is a case to provide additional funding.

National Partnership Funding

National Partnership Agreements (NPAs) are time limited agreements to support the delivery of specific outcomes or projects. The decrease in NPA funding over the Budget and Forward Estimates period reflects the expiry of agreements. NPA funding to be expended by the THS in 2016‑17 includes:

·       Adult Public Dental Services ($2.1 million);

·       Improving Health Services in Tasmania ‑ John L Grove ($5 million);

·       Improving Health Services in Tasmania ‑ Elective Surgery ($16.1 million);

·       Improving Health Services in Tasmania ‑ Emergency Department ($1 million); and

·       Expansion of BreastScreen Australia Program ($460 000).


 

Commonwealth Own Purpose Expenditure

Commonwealth Own Purpose Expenditure (COPE) payments are paid from the responsible Australian Government agency to the THS. COPE agreements in 2016‑17 include:

·       Commonwealth Home Support Program ($16 million);

·       Transition Care Program ($5.4 million);

·       Medicare ‑ aged care places ($3.7 million);

·       Multi‑Purpose Services at Beaconsfield and Campbell Town ($2.5 million);

·       Radiation Oncology ‑ Holman Clinic Capital Works ($1.4 million);

·       Home Care Packages ($1 million);

·       Aged Care Assessment Program ($652 000); and

·       Rural Primary Health Services Program ($218 000).

Other Sources of Revenue

Other Sources of Revenue represents THS generated own source revenue which in 2016‑17 primarily includes:

·       Patient Fees, including DVA revenue ($88.5 million); and

·       Pharmacy, Prosthesis and Pharmaceutical Benefits Scheme Revenue ($45.6 million).


 

Table 25.6:        Statement of Financial Position as at 30 June

 

2016)

 

Budget)

2017)

 

Budget)

2018)

Forward)

Estimate)

2019)

Forward)

Estimate)

2020)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Assets

 

 

 

 

 

Financial assets

 

 

 

 

 

Cash and deposits1

 43 955)

 67 819)

 69 904)

 72 644)

 75 465)

Receivables

 19 521)

 20 718)

 21 095)

 21 508)

 21 839)

Other financial assets

 20 233)

 18 824)

 19 128)

 19 478)

 19 714)

 

 83 709)

 107 361)

 110 127)

 113 630)

 117 018)

Non‑financial assets

 

 

 

 

 

Inventories

 7 997)

 8 713)

 8 826)

 8 980)

 9 098)

Property, plant and equipment2

1 405 612)

 999 391)

1 051 652)

1 655 747)

1 695 885)

Heritage and cultural assets

  576)

  949)

 1 034)

 1 126)

 1 227)

Intangibles3

 3 463)

  610)

  523)

  436)

  349)

Other assets

 3 901)

 4 249)

 4 227)

 4 254)

 4 347)

 

1 421 549)

1 013 912)

1 066 262)

1 670 543)

1 710 906)

 

 

 

 

 

 

Total assets

1 505 258)

1 121 273)

1 176 389)

1 784 173)

1 827 924)

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Payables4

 44 390)

 61 791)

 61 626)

 62 359)

 63 977)

Interest bearing liabilities5

 3 333)

....)

....)

....)

....)

Employee benefits

 196 754)

 213 591)

 215 093)

 218 366)

 227 592)

Other liabilities

 12 023)

 9 121)

 7 778)

 6 353)

 4 917)

Total liabilities

 256 500)

 284 503)

 284 497)

 287 078)

 296 486)

 

 

 

 

 

 

Net assets (liabilities)

1 248 758)

 836 770)

 891 892)

1 497 095)

1 531 438)

 

 

 

 

 

 

Equity

 

 

 

 

 

Reserves

 267 946)

 286 270)

 335 948)

 388 748)

 466 917)

Accumulated funds6

 518 937)

 81 041)

 86 485)

 638 888)

 595 062)

Other equity

 461 875)

 469 459)

 469 459)

 469 459)

 469 459)

Total equity

1 248 758)

 836 770)

 891 892)

1 497 095)

1 531 438)

 

 

 

 

 

 

Notes:

1.   The increase in Cash and deposits in 2017 primarily reflects revised assumptions on the timing of payments and size of payments to other jurisdictions for cross border obligations; higher than anticipated cash balances in the Private Patient Scheme and COPES funding balances for the THOs as at 30 June 2015, prior to their transition to the THS.

2.   The decrease in Property, plant and equipment in 2017 primarily reflects a revised methodology for the transfer of work‑in‑progress for the RHH Redevelopment to the THS and the 2014‑15 actual balances from the THOs as at 30 June 2015. The increase in 2019 anticipates the transfer of assets from the Department to the THS as a result of the completion of the RHH Redevelopment in 2018‑19.

3.   The decrease in Intangibles in 2017 reflects the closing balance in the prior year.

4.   The increase in Payables from 2017 reflects a more accurate estimate of the liability based on the prior year actual, and revised assumptions on the timing of payments and size of payments to other jurisdictions for cross border obligations.

5.   The decrease in Interest bearing liabilities in 2017 reflects the repayment of borrowings through the Department in 2015‑16, which were provided to fund the cost of staff separations in the THOs in 2014‑15.

6.   The decrease in Accumulated Funds in 2017 and increase in 2019 reflects a revised methodology for the transfer of work‑in‑progress for the RHH Redevelopment to the THS.


7. 

Table 25.7:        Statement of Cash Flows

 

2015‑16)

 

Budget)

2016‑17)

 

Budget)

2017‑18)

Forward)

Estimate)

2018‑19)

Forward)

Estimate)

2019‑20)

Forward)

Estimate)

 

$'000)

$'000)

$'000)

$'000)

$'000)

 

 

 

 

 

 

Cash flows from operating activities

 

 

 

 

 

Cash inflows

 

 

 

 

 

Grants1

1 123 709)

1 155 901)

1 158 848)

1 162 064)

1 187 830)

Sales of goods and services

 137 038)

 141 289)

 144 461)

 147 462)

 148 995)

GST receipts

 29 369)

 30 552)

 30 088)

 30 725)

 31 345)

Interest received2

....)

  302)

  329)

  435)

  496)

Other cash receipts3

 29 276)

 30 642)

 25 987)

 26 013)

 25 437)

 Total cash inflows

1 319 392)

1 358 686)

1 359 713)

1 366 699)

1 394 103)

 

 

 

 

 

 

Cash outflows

 

 

 

 

 

Employee benefits

(828 126)

(835 679)

(832 145)

(840 548)

(858 104)

Superannuation

(90 534)

(95 944)

(95 678)

(96 575)

(98 564)

Borrowing costs4

(192)

....)

....)

....)

....)

GST payments

(29 369)

(30 538)

(30 109)

(30 730)

(31 399)

Grants and subsidies5

(40 495)

(7 494)

(7 665)

(8 534)

(9 034)

Supplies and consumables6

(347 330)

(368 752)

(365 657)

(361 916)

(367 657)

Other cash payments7

(10 157)

(20 006)

(20 585)

(20 872)

(21 393)

Total cash outflows

(1 346 203)

(1 358 413)

(1 351 839)

(1 359 175)

(1 386 151)

 

 

 

 

 

 

Net cash from (used by) operating activities

(26 811)

  273)

 7 874)

 7 524)

 7 952)

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Payments for acquisition of non‑financial assets

(3 552)

(5 039)

(5 789)

(4 784)

(5 131)

Net cash from (used by) investing activities

(3 552)

(5 039)

(5 789)

(4 784)

(5 131)

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

Net borrowings8

(1 667)

....)

....)

....)

....)

Net cash from (used by) financing activities

(1 667)

....)

....)

....)

....)

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents held

(32 030)

(4 766)

 2 085)

 2 740)

 2 821)

 

 

 

 

 

 

Cash and deposits at the beginning of the reporting period

 75 985)

 72 585)

 67 819)

 69 904)

 72 644)

Cash and deposits at the end of the reporting period

 43 955)

 67 819)

 69 904)

 72 644)

 75 465)

 

 

 

 

 

 

 


 

Notes:

1.   The increase in Grants primarily reflects additional revenue from the Australian Government as a result of updates to hospital activity, and the provision of additional funding under the One Health System ‑ Additional Investment initiative. This increase is offset by a partial reduction in the NPA on Improving Health Services in Tasmania – Schedule A ‑ Reforming Elective Surgery in Tasmania; completion of the NPA on Improving Health Services in Tasmania ‑ Schedule D ‑ Better Access to Palliative Care; completion of funding provided by the Australian Government under the NPA on Improving Public Hospital Services ‑ Sub Acute Beds; expiry of the agreement relating to the Australian Government initiative on Organ and Tissue Donation and the expiry of the NPA on Treating More Public Dental Patients.

2.   The increase in Interest primarily reflects the recognition of interest earned on Private Patient Scheme balances.

3.   The decrease in Other cash receipts from 2017‑18 relates to the completion of the Training More Specialist Doctors in Tasmania initiative which was funded by the Australian Government through the medical professional colleges.

4.   The decrease in Borrowing costs reflects the early repayment of temporary borrowings for staff separations in the THOs in 2014‑15.

5.   The decrease in Grants and subsidies reflects the expenditure of the Cross Border payments to other jurisdictions for 2013‑14 and 2014‑15, which were previously carried forward into 2015‑16.

6.   The increase in Supplies and Consumables primarily reflects additional expenditure for Highly Specialised Drugs, Information Technology, and Maintenance as a result of updates to estimates of THS Own Source Revenue. The increase in 2016‑17 is partially offset by a reallocation of the Tasmanian Risk Management Fund premium to Other expenses in line with prior year actuals. The decreases in Supplies and Consumables in 2017‑18 and 2018‑19 relate to various State and Australian Government programs coming to completion in the preceding years.

7.   The increase in Other cash payments reflects the reallocation of TRMF premiums from Supplies and Consumables to align with prior year actuals.

8.   The reduction in Net borrowings reflects the early repayment of temporary borrowings provided to fund the cost of staff separations in the THOs in 2015‑16.