Rudd reveals national plan for hospitals

Kevin Rudd says Australia's ailing hospitals are in need of serious surgery, and
he's planning to bribe the states to give him the power to get on with the job.
Under the federal government's health plan the commonwealth would fund public
hospitals and locals would run them.
Under the plan, the federal government will take $90 billion over five years - $50
billion over the first three - in GST revenue from the states for a new National
Health and Hospital Network.
Prime Minister Kevin Rudd says it is the biggest change to health care since Medicare.
In exchange, the states will save $15 billion in the five years to 2020 and
potentially tens of billions more after that.
That's because Canberra is promising to fund 60 per cent of all hospital costs going
forward, rather than the current 35 per cent.
The commonwealth will also run and fund all health care provided outside hospitals.
"The Australian government's decision to take on the dominant funding role for the
entire public hospital system is designed to end the blame game, to eliminate waste
and to shoulder the funding burden of the rapidly rising health costs of the
future," Mr Rudd said on Wednesday.
The new local hospital networks will be made up of one to four hospitals.
They'll be run by local health and financial professionals "rather than central
bureaucracies" and be required to meet tough national service and performance
standards.
If patients can't get into emergency departments or elective surgery fast enough
hospitals will be penalised.
The federal government also plans to introduce activity-based funding from July 2012.
Hospitals will be paid a set amount - determined by an independent umpire - per
treatment. If it costs them more to deliver, the relevant state will have to pay the
difference.
It's hoped this will make hospitals lift their game and save $1.3 billion a year.
Health Minister Nicola Roxon says this "fundamental change" is crucial to the plan's
success.
"If you're doing 10,000 hip surgeries, you get paid for 10,000 hip surgeries," the
health minister said.
"We pay 60 per cent, the state pays 40 per cent. It does remove that argument over
funding."
Additional funding for the states will make the deal "hard to walk away from", Ms
Roxon said.
The country's only Liberal premier, Western Australia's Colin Barnett, believes
national funding has merit. He says he'll analyse the plan carefully.
"I said (to Mr Rudd) we would take a sensible, careful approach," he told reporters.
"(But) he'll need to do it by co-operation, not force."
Doctors, nurses and health consumers all gave the reform a tentative thumbs-up on
Wednesday.
"This is good health reform in principle," Australian Medical Association president
Andrew Pesce said.
Giving Canberra greater control was "worthy" and shouldn't be dismissed out of hand,
the Australian Nursing Federation said.
The Consumers Health Forum argued local networks should result in people having a
greater say about what services are provided in their community.
But the federal opposition slammed the plan.
Coalition Leader Tony Abbott said nothing was going to happen until 2012 at the
earliest.
"The timing of the roll-out of this proposal raises suspicions this is a fix for an
election campaign, not a fix for the public hospitals system," Mr Abbott said.
If the states and territories aren't prepared to give up control in exchange for the
commonwealth paying more, the prime minister says, he'll take the plan to the
people.
A referendum this year could "give the Australian government all the power it needs
to reform the health system", Mr Rudd said.