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Hospital to state its case

Tuesday, 10th May, 2011

FAIR GO: CEO Stuart Riley says the hospital faces unique circumstances. FAIR GO: CEO Stuart Riley says the hospital faces unique circumstances.

by Gina Wilson

The hospital has prepared a brief of evidence to try and secure more precious health dollars.

Under new funding arrangements, due to take effect on July 1, the hospital will be moved from a block funding method to a case by case, or episode, funding method. Each case would be costed at a yet-to-be-determined set amount.

Far West Local Health Network chief executive officer, Stuart Riley, said the hospital faced unique circumstances which made it more expensive to provide services than its counterparts in urban areas.

This, Mr Riley said, must be taken into consideration when dishing out the dollars.

"We are preparing for episode-based funding but also doing work to get a better understanding of the impact on a place like Broken Hill Hospital," he said.

"We have to compare Broken Hill with other hospitals nationally so we can put an informed case to the Commonwealth around changes we need made to episode funding and why."

Critics of the funding regime, including the Far West Local Health Network's (FWLHN) governing council chairman, Dr Steve Flecknoe-Brown, said the local hospital could not be expected to provide services for the same price as city hospitals and must be funded accordingly.

Mr Riley agreed, saying there were two key issues that affect the operating costs of the hospital compared to a city or inner regional hospital: travel and locums or agency staff.

He said the cost of getting specialists to the city combined with the cost of sending patients out of Broken Hill for treatment was a financial burden that other hospitals did not have to bear.

With the city being less attractive to professionals on a long-term basis, the costs of locums, used to fill holes, was also very high, he said.

These factors pushed the price of an episode or separation up.

"The cost of dealing with a broken leg in Broken Hill is not the same as at the Royal Price Alfred," Mr Riley said.

"We need a different price to take into account the different cost structures we have.

"We have to build a really clear picture of what these costs are and how that may be factored into episode based funding."

Episode funding would be introduced to the hospital on July 1, with the NSW Health Department to set the price on procedures from then until 2012.

Broken Hill hospital's funding would be tracked against activity-based funding for the first 12 months to ensure the hospital was coping prior to the full introduction of activity-based funding on July 1, 2012.

After that time, an independent, national hospital pricing authority would determine the standard price for each case, called a 'weighted separation.'

At this point it was expected that the hospital's budget would be based largely on activity.

The hospital had been preparing for the change more than 12 months, Mr Riley said, and had held discussions with senior clinicians, specialist costing people and the governing council.

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