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Monday, 11 November 2002
Page: 6042

Senator Mark Bishop asked the Minister representing the Minister for Veterans' Affairs, upon notice, on 25 September 2002:

(1) Is a review being conducted of the tier-one hospital arrangements; if so: (a) by whom; (b) at what cost; (c) in what time frame; and (d) what are the terms of reference.

(2) Has a steering committee been appointed; if so, is the ex-service community represented.

(3) Will it include an independent cost-benefit study of private versus public hospital treatment costs.

Senator Hill (Minister for Defence) —The Minister for Veterans' Affairs has provided the following answer to the honourable senator's question:

(1) A `post implementation' review of tier-one hospital arrangements is planned but it has not yet commenced.

(a) This has not yet been determined, but an external consultant will be contracted to assist with the study.

(b) This has not yet been determined, as it will await the outcome of a Select Tender process.

(c) It is expected that such a review would take approximately six months.

(d) The draft terms of reference are as follows:



The Repatriation Commission is seeking an independent review of its strategies for purchasing public and private hospital services for entitled veterans, war widow(er)s and dependants to ensure that its arrangements are cost-effective to ensure access to quality, appropriate hospital services.

Within the broad health service environment the consultant is required to:

1. Examine the Department of Veterans' Affairs' arrangements for purchasing public and private hospital services for entitled veterans, war widow(er)s and dependants, identifying the associated costs, benefits, risks, strengths and weaknesses, while taking account of the historical legacy of the Department's hospital services' arrangements; and

2. Develop a report with options and recommendations for improvement in future purchasing of hospital services to ensure veterans and dependants have effective access to quality and cost-effective hospital services.

In undertaking this review the successful tender will also need to consider the following policy issues:

· the appropriateness of the Department's competitive neutrality purchasing policies;

· whether the existing purchasing arrangements lead to appropriate contracting of hospitals with due regard to access, quality, and efficiency;

· options for increasing competition and achieving improved value for money in a market place that tends to be segmented but where private hospital ownership is consolidating within a few corporate groups;

· whether the current payment models have the appropriate incentives and disincentives for the delivery of best practice care;

· the perceived increasing need for substitutability among providers of health care/hospital services where appropriate;

· improvements for monitoring quality and continuity of care;

· the appropriateness of the current information flows between the veteran community, the Department and the providers, or if these need to be enhanced to enable the veteran community greater ownership of their health requirements; and

· the appropriateness of the current regulatory controls and quality mechanisms that are necessary to ensure that veteran communities are protected.

(2) A steering committee has not, as yet, been appointed. Any advisory committee that is appointed will have wide representation from both within the Department of Veterans' Affairs and from the wider health industry. It has not yet been decided whether there will be ex-service organisation representation on the committee.

(3) No.