A new report from the AMA finds funding models are locking public hospitals into cycles of crisis and calls for a fresh approach. 

The report, Public hospitals: Cycle of crisis calls for funding that moves beyond activity and volume to a funding partnership by state, territory and federal governments based on community demand and timeliness of treatment.

Current funding arrangements are failing to meet the demands of our ageing population beset by chronic disease and complex conditions.

It proposes additional funding to stem the crisis in public hospitals and reverse persisting decline in capacity through;

  • extra beds and staff to end hospital ramping, meet community demand and improve treatment times
  • prioritising out-of-hospital care alternatives addressing avoidable admissions and re-admissions
  • reforming the funding formula for activity-based funding to a 50:50 share between the Commonwealth and states and territories (with the latter to reinvest consequent savings into performance improvement), and eliminating the Commonwealth’s artificial 6.5 per cent cap on growth

  • re-introducing select pay-for-performance targets.

AMA President Dr Omar Khorshid said the report cuts through the current debate and gets to the heart of what needs to change.

“Our analysis paints a disturbing picture of even greater unmet demand, fewer hospital beds, overcrowded emergency departments and longer waits for elective surgery, risking the lives of all Australians if governments keep their heads in the sand.”