How are costs controlled?
Costs are controlled by various market, financing, and managerial mechanisms. Australia has a mature generic pharmaceuticals market. The Australian Government is a near-monopolist purchaser of patent medicines which, combined with tight prescribing requirements, allows it to control pharmaceutical pricing. New pharmaceuticals have to meet cost effectiveness criteria and are subject to nationally negotiated pricing before inclusion in the formulary of publicly subsidized medicines. Public hospitals are managed with broadly capped global prospective budgets which effectively control costs, but have at times caused waiting lists for elective access. Health insurance funds negotiate and publish agreed-upon prices with their preferred private hospitals and other service providers. Additional measures include controlling the growth in cost of some large-volume diagnostic services through industry agreements with the relevant medical specialty; controlling access to specialist services through “gatekeepers” such as GPs; and limiting the number of providers with access to some “high-tech” services, such as MRIs.
What major innovations and reforms have been introduced?
Health Workforce Australia was set up in 2006 by the Council of Australian Governments to deliver programs across four main areas: workforce planning, policy, and research; clinical education; innovation and reform of the health workforce; and the recruitment and retention of international health professionals. The regulation of health care professionals, previously a function of state-level boards, has been overhauled: the Australian Health
Practitioners Regulation Agency was established in 2010 to oversee new national boards and to administer the Health Practitioner National Law Act 2009 for each of the 14 current health occupational groups.
The Australian National Preventive Health Agency was established in January 2011 to develop strategic partnerships across all sectors, to provide technical advice and assistance, and to promote health and reduce health risk and inequalities. One step it has taken so far has been to introduce plain packaging for cigarettes in December 2012.
As described above, the Council of Australian Governments agreed on a hospital reform strategy including changes to the funding formula in August 2011, the National Health Reform Agreement, after several years of debate. One hundred thirty-six Local Hospital Networks have been formed with local boards, although state health departments continue to be the overall administrators of their public hospitals. The National Health 18 The Commonwealth Fund Performance Authority was set up as a statutory authority in 2011 to collect information on and monitor trends in the performance of health service providers, and monitors the performance of public hospitals against the National Health Performance Framework. The National Mental Health Commission was set up in January 2012 to report on the delivery of mental health reforms. Last, the National Disability Insurance Agency was established by the Australian government in 2013 to implement the National Disability Insurance Scheme. The first stage commenced from July 2013 in launch sites in several states to provide care and support initially for an estimated 20,000 people with significant and permanent disabilities.
References
Australian Institute of Health and Welfare (2012). Health expenditure Australia 2010–11. Health and welfare expenditure series no. 47. Cat. no. HWE 56. Canberra: AIHW.
Australian Institute of Health and Welfare (2012). Residential aged care in Australia 2010–11: a statistical overview. Aged care statistics series no. 36. Cat. no. AGE 68. Canberra: AIHW.
Australian Institute of Health and Welfare (2011). Australia’s Welfare 2011. Canberra: AIHW.
Australian Institute of Health and Welfare (2012). Australia’s Health 2012. Department of Health and Ageing, Residential Care. Accessed Sept. 23, 2011.
http://www.health.gov.au/internet/main/publishing.nsf/Content/Residential+Care-2.
Healy, J., Sharman, E., and Lokuge, B. (2006). “Australia: Health System Review,” Health Systems in Transition 8(5):1–158.
Healy, J. (2011). Improving Health Care Safety and Quality: Reluctant Regulators (England, U.S.: Ashgate).
OECD Health Data 2013.
Private Health Insurance Administration Council (2013). March Statistics 2013.
How are costs controlled?Costs are controlled by various market, financing, and managerial mechanisms. Australia has a mature generic pharmaceuticals market. The Australian Government is a near-monopolist purchaser of patent medicines which, combined with tight prescribing requirements, allows it to control pharmaceutical pricing. New pharmaceuticals have to meet cost effectiveness criteria and are subject to nationally negotiated pricing before inclusion in the formulary of publicly subsidized medicines. Public hospitals are managed with broadly capped global prospective budgets which effectively control costs, but have at times caused waiting lists for elective access. Health insurance funds negotiate and publish agreed-upon prices with their preferred private hospitals and other service providers. Additional measures include controlling the growth in cost of some large-volume diagnostic services through industry agreements with the relevant medical specialty; controlling access to specialist services through “gatekeepers” such as GPs; and limiting the number of providers with access to some “high-tech” services, such as MRIs.What major innovations and reforms have been introduced?Health Workforce Australia was set up in 2006 by the Council of Australian Governments to deliver programs across four main areas: workforce planning, policy, and research; clinical education; innovation and reform of the health workforce; and the recruitment and retention of international health professionals. The regulation of health care professionals, previously a function of state-level boards, has been overhauled: the Australian HealthPractitioners Regulation Agency was established in 2010 to oversee new national boards and to administer the Health Practitioner National Law Act 2009 for each of the 14 current health occupational groups.The Australian National Preventive Health Agency was established in January 2011 to develop strategic partnerships across all sectors, to provide technical advice and assistance, and to promote health and reduce health risk and inequalities. One step it has taken so far has been to introduce plain packaging for cigarettes in December 2012.As described above, the Council of Australian Governments agreed on a hospital reform strategy including changes to the funding formula in August 2011, the National Health Reform Agreement, after several years of debate. One hundred thirty-six Local Hospital Networks have been formed with local boards, although state health departments continue to be the overall administrators of their public hospitals. The National Health 18 The Commonwealth Fund Performance Authority was set up as a statutory authority in 2011 to collect information on and monitor trends in the performance of health service providers, and monitors the performance of public hospitals against the National Health Performance Framework. The National Mental Health Commission was set up in January 2012 to report on the delivery of mental health reforms. Last, the National Disability Insurance Agency was established by the Australian government in 2013 to implement the National Disability Insurance Scheme. The first stage commenced from July 2013 in launch sites in several states to provide care and support initially for an estimated 20,000 people with significant and permanent disabilities.ReferencesAustralian Institute of Health and Welfare (2012). Health expenditure Australia 2010–11. Health and welfare expenditure series no. 47. Cat. no. HWE 56. Canberra: AIHW.Australian Institute of Health and Welfare (2012). Residential aged care in Australia 2010–11: a statistical overview. Aged care statistics series no. 36. Cat. no. AGE 68. Canberra: AIHW.Australian Institute of Health and Welfare (2011). Australia’s Welfare 2011. Canberra: AIHW.Australian Institute of Health and Welfare (2012). Australia’s Health 2012. Department of Health and Ageing, Residential Care. Accessed Sept. 23, 2011.http://www.health.gov.au/internet/main/publishing.nsf/Content/Residential+Care-2.Healy, J., Sharman, E., and Lokuge, B. (2006). “Australia: Health System Review,” Health Systems in Transition 8(5):1–158.Healy, J. (2011). Improving Health Care Safety and Quality: Reluctant Regulators (England, U.S.: Ashgate).OECD Health Data 2013.Private Health Insurance Administration Council (2013). March Statistics 2013.
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