Update on the National Health Reforms

1. Update on the National Health Reforms Area Managers’ Forum 20 July 2010

2. National Health and Hospitals Agreement • Only authoritative source of what has been agreed – If it’s not in the agreement it’s rumour! • Outlines proposed changes: • Local Health Networks • Primary Health Care Organisations • Funding arrangements • Performance Accountability Framework • National Governance • Implementation

3. National Health and Hospitals Agreement Primary Health Care Organisations • To be known as ‘Medicare Locals’ • Will be created from existing Divisions of GP • Will be independent entities providing GP and GP-like services • Boundaries will align with LHN boundaries • Likely to be two PHCOs in the Hunter New England

4. The Commonwealth’s Role • Determine the ‘efficient price’ • Pay 60% for each public hospital service provided • Pay 60% of other costs – research and teaching, block funding for small hospitals, capital expenditure • Develop national performance indicators and targets • Establish a national governance model

5. The State’s Role • System manager of hospitals including: • Purchasing services from LHNs • System wide planning and policy • System wide capital planning and management • Ownership of existing assets • Managing LHN performance

6. Local Health Networks • The State will establish the LHNs • Number/boundaries of LHNs will be decided by the State – initially boundaries will be agreed with the Commonwealth • Where possible the LHNs and PHCOs will have common boundaries • LHNs will have a Governing Council and a CEO • Governing Councils will be appointed by the State Health Minister

7. Local Health Networks • Membership of Governing Councils will include: • People with health, business and financial management expertise • Clinicians (external to the LHN) • Representatives from local PHCOs • Representatives of Universities, clinical schools and research centre • People with other relevant skills and experience • Makeup of the Councils must ensure local community knowledge and understanding

8. Local Health Networks • The CEO will be appointed by the Governing Council with approval of the State Health Minister or delegate • LHNs will be responsible for the delivery of agreed services and performance standards within an agreed budget

9. HNE Health’s Response • Consultations with key clinicians and managers, clinical and staff groups, local politicians and community representatives • To date, around 240 clinicians, managers and staff involved in consultations • Plus, four forums hosted as part of the Director General’s Listening Tour

10. HNE Health’s Response Through the consultations we wanted to identify: • Significant areas of concern and the major issues/risks of the proposed changes that need to be addressed • Key principles to be considered in making decisions about where services/functions /responsibilities should sit in the new structure • Issues that need to be addressed in transitioning to the new structure

11. Significant concerns and risks • Loss of specialised clinical and corporate support networks • Loss of ‘critical mass’ and ‘economies of scale’ • Capacity and capability of LHNs/PHCOs to take on Area services, functions and responsibilities • Concerns with centralising control • The time, money and effort to undertake structural change

12. Principles Maintaining networks • Services and service networks including specialist clinical and corporate services across LHNs, and across LHNs and PHCOs can be managed, supported and coordinated • Inter and intra-connections that have been established between and across Areas that have resulted in improved access to services are preserved • Professional networks for support/development/ guidance/supervision (both professional and collegiate) can be maintained, strengthened and improved

13. Principles Maintaining critical mass and economies of scale • There is a critical mass of skilled staff available to provide the services • Services are structured to optimise economies of scale particularly around efficiency and effectiveness of service delivery

14. Principles Ensuring capacity and capability • There is capacity (resources) and capability (expertise) available to support and advise LHNs • There is capacity and capability to drive major initiatives and large scale programs • Models that have the capacity to influence can be maintained • Innovation and clinical redesign can be supported and encouraged

15. Principles • Issues can be recognised/acted on/responded to appropriately, equitably and in a timely manner • Relationships with key partners can be maintained, strengthened and improved • Strategic focus on operational issues can be maintained, strengthened and improved • Time, resources, money and effort involved in setting up the new arrangements is minimised

16. Conclusions • There is overwhelming support for HNE Health • Pride in and support for what we have achieved in HNE Health – there are things that must be preserved • Consensus – things are going well and there should be minimal change

17. Conclusions • If possible, Hunter New England should become the HNE Local Health Network (LHN). If not, there should only be 2 LHNs in the area • Local ‘Health’ Networks will have responsibility for hospitals and a range of community based services similar to Area Health Services • Some services/functions/responsibilities need to be coordinated/administered at a supra-LHN or regional level

18. Next steps • NSW Health will release a draft discussion paper for public review by early August • By early September final paper recommending new structure to the Minister • September/October – negotiations with C’wealth to finalise LHN structure • From 1 January 2011 – transition to LHNs

19. Moving Forward • AET meeting next week to develop an action plan to prepare the organisation for the change • Biggest challenges: • Deciding what goes where and how things should be split • Managing the change while maintaining our focus on providing quality safe care

20. Moving Forward At your table: • Brainstorm the issues/challenges that AET need to consider/address in the action plan and prioritise your top 5 issues • Identify things we need to do to successfully manage the change and at the same time maintain our focus on providing quality safe care including: • Embedding Caring Together outcomes • Rolling out the Excellence Program and other projects like Between The Flags and Essentials of Care • Maintaining a focus on performance