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Tuesday, 1 November 2011
Page: 12384

Ms O'NEILL (Robertson) (20:56): I rise to also speak on the National Health Reform Amendment (Independent Hospital Pricing Authority) Bill 2011. Every member of this parliament should feel proud of the Australian healthcare system. Our health workers strive every day to improve their standards in the service of our community. Not only are our hospitals world class but they are staffed by dedicated doctors and nurses who play a vital role in our community, yet it is sadly a fact that they are often underappreciated.

I am profoundly disappointed by the Public Service wage freeze policy promoted by the O'Farrell government in New South Wales. For our health system to remain a world-class system, within the context of a population that is ageing, we should be encouraging people to enter the nursing profession rather than setting up structures that would encourage them to depart and take all that skill, expertise and care with them to other industries. We should be sending the message that our country values its nurses and health professionals, but that is not the sentiment reflected when the state of New South Wales capped the pay increases of nurses at 2.5 per cent.

In contrast, Labor understands the need to care for the caring professions and ensure a fair day's pay for a fair day's work. That is why I am proud, and will always be proud, to be a member of parliament from the Australian Labor Party. As a party, we will always work to ensure that the providers of our essential services are treated in a respectful and dignified manner. I am certainly very proud of our health system and of the services that our hospitals provide, but at this time in our great history as a nation we need to expand our capacity if we are going to effectively meet the challenges of a growing and ageing population. Importantly, these pressures manifest on local and regional levels. In the suburb of Kincumber, located in my electorate of Robertson, according to the 2006 census—which will hopefully be updated very soon with the census data collected this year—25 per cent of the suburb was aged 65 and over. This percentage rate is expected to increase once the baby boomer generation nears retirement. Of course, the ageing population is an issue that has been mentioned countless times in this chamber, and it has been mentioned numerous times by me in my speeches in this place. The ageing of the nation is a sign of success though; I do not want to make it a negative thing. It is a sign of the success of 100 years of very effective and positive health and social policy. We are living longer, and that is a good thing. Despite this, the challenges of providing quality health to an ageing population cannot be ignored; and it certainly requires government action—and now.

Thankfully, this Labor government has decided to act in the long-term interests of the country—once again, the national interest—by undertaking much-needed national health reforms. I am proud to be part of a government that has health reform at the heart of its agenda. The Labor Party is doing what was not done for 11 years under the Liberals. We are bringing transparency and accountability to the health system to ensure it is sustainable as our population ages and comes to retirement.

This bill will introduce the Independent Hospital Pricing Authority, and this body will determine a national efficient price for hospital services. There will be no more blank cheques from governments to hospitals with no follow-up and no accountability. The pricing authority will, amongst other things, determine a national efficient price for healthcare services provided by public hospitals and develop and maintain costing and classification specifications. Importantly, as a measure of transparency accountability, the pricing authority will be required to publish these decisions. There will be no more hiding; everything will be on show for the Australian public to see. The effective allocation of health care services, rather than simply a historical allocation of services, in a national economy requires that appropriate and effective mechanisms are put in place to make sure the most fair, the most appropriate and the most transparent pricing policies are what is actually implemented.

The establishment of the Independent Hospital Pricing Authority has been necessitated by the Commonwealth-state agreement to implement Commonwealth activity based funding. A move to activity based funding is a reform that only a Labor government could make; it is a reform that is needed to make sure we meet our future healthcare demands. This legislation is evidence of Labor getting on with the task of governing well, and it marks a real change from the Howard era, when blame shifting between federal and state governments was developed to the level of an art form.

The Gillard government has taken responsibility and sought to revolutionise the healthcare system. We have committed money and care, increasing Commonwealth responsibility and enabling us to work towards maintaining and advancing our world-class national healthcare system. Activity-based funding will help achieve this target by increasing the efficiency of public hospital funding. It is distinct from the current system, where the Commonwealth provides public hospitals with block grants from the states and territories, which are not tied to the provision of services. We have heard members on the other side wax lyrical about what a great system the current system is, yet for hospitals in regions such as mine, where we have had incredible population growth, the maintenance of historical sources of funding is an inefficient and ineffective way of responding to the reality of shifting demographics and shifting needs. As well, there is a cost in shifting a clinical practice and in changes for practitioners in the field.

Every dollar that is wasted in our health system is a dollar that could have been directed to improving health and improving lives. For the people of Robertson, my eyes are firmly focused on achieving that task locally. Efficiency in funding is vitally important and it is a vital reason as to why I strongly support this bill. I have to say that many of the practitioners in my area have spoken with great optimism about the positive change that this funding model change will make to their practice in our community.

A truly national healthcare system requires appropriate Commonwealth governance, and this is what the Gillard government will provide. The pricing authority is an essential component in ensuring that the development of an activity based funding model leads to real reform in the healthcare system. The pricing authority is independent; it is an independent statutory authority. In essence, it acts almost like a Reserve Bank for the public hospital system. It will provide advice to state and territory governments, it will be free of political pressure, and it will be advising about the efficient price for a particular procedure or range of procedures or for a particular operation or a number of operations provided in a public hospital.

This independent advice will also enable the development of robust systems to support activity based funding for these much-needed services. Really, this is what people expect, and it is certainly what the healthcare system needs—clear, transparent and accountable funding decision-making. No funding should be made in order to score cheap political points, yet that is what we saw time and again under the leadership of John Howard and those who are now sitting opposite in prominent positions, where the scoring of cheap political points seems to be a game that is being played out at the cost of the nation.

In relation to its management of public hospital funding, the pricing authority will take submissions and engage in detailed technical work with clinicians in the setting of efficient prices for services funded by both activity based funding and block funding. The factors that the pricing authority is going to take into account include reasonable access, clinical safety, fiscal issues and, of course, efficiency. As stated, a purpose of this bill, in addition to the entirety of the Gillard government's National Health Reform Program, was to best ensure that our health system can cope with the pressures of an ageing population and our changing demographic overall.

An independent pricing authority is, however, just one of the planks in a broader reform agenda. We will also see a national health funding pool to replace the current inefficient funding system. The funding pool will bring state and federal health funding together into one source. This will ensure that both levels of government are always aware of where health funding is spent, and every health dollar will be spent and accounted for. The funding pool will be run by an administrator and it will be paid directly to the local health networks. This will ensure that records are able to be kept for every expense and that a fair national price is paid for each activity.

I am happy that the Central Coast finally has its own dedicated health region. With a population of almost 300,000, we are as large as Canberra but far less well-resourced; we certainly are not a beneficiary of historical block funding. I expect that services on the coast will significantly improve for my community under this Labor reform. Equity of service and equity of funding will be provided like never before through greater local responsiveness. Being lumped in with North Sydney, as we were, did no favours to either of the regions for the provision of health services. I am glad that Central Coast locals will be saying where the money will be going on the Central Coast.

We in Robertson were gifted with some wonderful news from Minister Roxon recently. The Woy Woy Hospital rehabilitation facility has been revived by the Labor government's investment of $12.7 million and $9 million over the next two years of forward estimates to make sure that this much loved health service will mean that locals on the peninsula will be able to stay close to friends and family while they are receiving ongoing care in recovery. This government is clearly dedicated to providing more assistance to primary health care and, through the provision of additional subacute beds to Woy Woy Hospital to assist individuals, we are making this idea a reality. It is not a blank cheque, however, for state governments. The beds that have been allocated will be assessed and monitored to ensure that funding is being directed to the most effective care. By increasing the number of subacute beds, emergency departments across the country will be able to deal most effectively with the people that are in need of immediate care.

We are taking the necessary steps that state governments failed to take in order to bring efficiency and accountability to our health system and improve the health outcomes for all Australians. This policy enacted in legislation acknowledges that, while a national system of public hospital funding is needed, local factors always need to be taken into account. I regard this as a vital consideration because the local health needs of my electorate of Robertson differ substantially from those of electorates in other parts of the nation.

This reform and the establishment of the pricing authority will help ensure that hospital funding can dynamically adjust to shifting populations, to local demographic characteristics, to the changing costs of delivering medical services from technological and clinical innovation, as well as adjust to the complexity and location of delivering hospital services. Importantly, this policy takes account of the fact that activity-based funding is not appropriate for small regional and rural hospitals. It will be adjusted to fit the context. Such hospitals will be funded by block funding to help them ensure they deliver on community service obligations

As a member of parliament for the Australian Labor Party, I am proud to be part of a government that has made the hard decision to embark on significant health reform. It is not reform for the sake of reform, but reform that is clearly directed to better ensure that we meet the challenges of providing for all Australians with access to a world-class healthcare system wherever they are. It is a reform that will work to ensure that money allocated by the Commonwealth on the basis of activity will be efficiently spent in the nation's public hospitals. Importantly, the Commonwealth's commitment to activity-based funding provides a greater incentive for investment in primary care services. That has to be good for all of us and for our communities. Because the Central Coast is a retirement destination, primary care really has a vital role in addressing healthcare needs early without visits to hospitals being necessary. For these and so many other wonderful reasons that will improve our health outcomes in this country, I commend the bill to the House and I urge its prompt passage through the parliament.