CEO’s Report
Michael Roff, Chief Executive Officer
2009 has proved to be another busy year for APHA on a number of fronts.
Chris Rex took on the role of APHA President in late 2008 and has had an active first year in the job. In addition to his leadership of the Board, Chris has been personally involved in a wide range of issues, effectively representing the Association at the highest levels.
We have bedded down the corporate governance changes implemented last year with the new structures of Board, Council and Taskforces (including “panels of interest”) working well to progress APHA’s strategic priorities and articulate our objectives into actions and outcomes. More detailed commentary on the work of each of the Taskforces is contained elsewhere in this report. Using these structures we have been able to engage more broadly with the membership (and hopefully provide better feedback about what is happening “behind the scenes”).
The 2008 Federal Budget announced measures to change the Medicare Levy Surcharge thresholds. Late last year we were successful in negotiating with a range of parties in the Senate to ensure a more reasonable outcome was achieved than the magnitude of change originally proposed by the Government.
As a result of the changes imposed by the Senate, Treasury revised down its estimate of the number of people who would drop out of health insurance in the first year after these changes from 644,000 to 492,000. However as at the June quarter 2009, membership had actually increased by 211,000. Despite the fact this Treasury modelling has been totally discredited, it continues to be used.
As a condition of agreeing to the modified thresholds, Senator Nick Xenaphon insisted the Government implement a Productivity Commission research project into the performance of public and private hospitals. APHA was consulted by the Government in relation to the terms of reference and the majority of our suggestions were reflected in the Terms of Reference.
This study was commissioned in May and APHA has been involved through the provision of data and submissions, meetings with the Commission and participation in a number of roundtable discussions. The interim report indicated that on a casemix adjusted basis, hospital costs were more than 30% lower in the private sector compared with public hospitals. In addition, the private sector performed better on the available safety and quality outcome data. The final report which was released in December, confirmed these findings, and should make it difficult for the Government to attempt to divert resources for the Government to attempt to divert resources away from private hospitals.
In the 2009 Budget, the Government again moved to change the policy mechanisms supporting health insurance membership with its proposals to introduce a complex system of means testing the rebates. The legislation giving effect to this measure was rejected by the Senate in September. At the time of writing, the government has reintroduced the legislation and APHA will continue to voice our opposition.
There is no indication the legislation will pass the second time around, and with the Government eager to achieve expenditure savings, it begs the question – what will be in the 2010 Budget given that health insurance rebates are clearly a target.
The other big issue on the policy front was the final report of the National Health and Hospitals Reform Commission (NHHRC), released in June. The NHHRC consulted exhaustively in preparing its report. They received over 860 submissions, had 450 replies to an electronic survey, conducted 26 consultations with frontline health workers and community groups right around the country, in addition to a range of bilateral meetings and industry forums where groups like APHA provided input.
It was somewhat surprising then, that when the Prime Minister launched the final report, he announced his next step would be to undertake extensive consultations with the community, health workers and key stakeholders before deciding, which, if any, of the 123 recommendations the Government would adopt.
In late November, APHA participated in a specific private sector focussed consultation with Minister Roxon that only took place due to concerted lobbying by APHA. I suspect I will be writing about the upshot of the NHHRC process this time next year and for several years to come.
Another issue that required significant efforts by APHA was the announcement in late 2008 of a NSW Government proposal to implement a “blood tax”, by making private hospitals pay for the use of blood and blood products in blatant contravention of the National Blood Agreement.
Although this measure was due to be implemented in April this year, APHA has successfully averted its introduction and is now working with pathologists and the medical profession in a joint approach to the NSW Government to ensure that while blood is used efficiently, private hospitals are not charged.
The Federal Government’s Award Modernisation process had the potential to impose enormous new costs onto private hospitals in the order of hundreds of millions of dollars each year. However, due to strong and united representations from the sector the outcome was a modest change with an extended implementation period that will be manageable. Much of the detailed work on this issue was undertaken by Lucy Fisher from PHAQ who is to be congratulated for her efforts.
To ensure that we are meeting the needs of our members, APHA repeated a member survey first conducted in 2007. The survey focussed on APHA’s core activities and service in four key areas:
- Lobbying
- Communication
- Market Intelligence
- Industry Information
It was pleasing to note that of the 25 quantitative performance attributes covered by the survey, 24 improved at a statistically significant level (the 25th attribute also improved but not by a statistically significant level). The range of improvements in ratings was from 11.3% to 32.5% which represented very significant improvements over a two year period. APHA will continue to strive to improve our representation of, and services provided to members. This is evidenced by new measures such as providing a significant financial investment to develop a National Private Hospitals Safety and Quality indicators Collection. This initiative (the first truly national collection of its kind) is currently in its pilot phase. Ultimately, it will provide benchmarked feedback to member hospitals on a quarterly basis. In addition to comparative performance feedback, the intention is to share lessons from high-performing organisations to assist all members in further improving the safety and quality of services provided to patients.
There were a number of changes in staff at the National Office this year. In February we farewelled Paul Mackey after seven years of sterling service as Director, Policy and Research. Dr Barbara Carney was subsequently appointed to this position.
Angela Hook joined us as Member Services Manager in March and Dr Peter Thomas filled the newly created position of Policy Manager in August. Elise Campion also joined us as a casual Administrative Assistant.
Together with the rest of the staff, Lisa Ramshaw and Kathryn Lee, this group comprises an extremely effective team who are dedicated to providing excellent services to our members and representing the interests of a strong private hospital sector. I would like to thank all of them for their efforts this year.
In 2009 we also welcomed HESTA Super Fund as the Association’s new Diamond Sponsor. HESTA has been a long standing supporter of APHA and we are delighted they have taken the opportunity to enhance their level of involvement with us.
In addition to HESTA, I would like to thank all of our Sponsors and Associate Members. The generous support of these organisations underpins our financial capacity to represent the sector and is greatly appreciated.
Finally, I would like to thank all of the members of APHA for their ongoing support, assistance, advice and feedback. At the National Office, we are constantly trying to balance our need for data to support our advocacy on a range of issues with the need to avoid “survey overload” for member hospitals. Sometimes our requests for information can appear onerous, but the contribution of members in this regard enhances the capacity of the Association to provide robust representation for the sector.
