Legislative Assembly for the ACT: 1998 Week 7 Hansard (24 September) . . Page.. 2194 ..
MR MOORE (continuing):
The Commonwealth's offer involved a real increase in health funding in 1998-99, relative to both the 1997-98 base and what it would be if existing arrangements were extended into 1998-99. That in-principle agreement gave the ACT access to the Commonwealth critical and urgent treatment funds - sometimes known as the "cut" funds - to be targeted at reducing waiting lists. The ACT has received $16.5m as part of this scheme.
Since January, the ACT has collaborated with other States and Territories in an effort to draft an agreement which represented a broad overarching framework governing the provision of public hospital services to the Australian community and adhered to the jointly agreed principles. A final financial offer was made to States and Territories by the Prime Minister on 6 August 1998 which injected a further $915m over five years into the States and Territories health systems. This included additional base funding of $850m and a one-off $65m for specific health priority projects.
In line with the agreement in January that the ACT would not be disadvantaged if a further offer was made by the Commonwealth, the ACT's share of the base funding increase is $2.4m in 1998-99 and $13.3m over the five years to 2002-03. The ACT's share of the one-off funds is $1.5m which is to be made available for initiatives specific to the ACT in 1998-99. The new funding offer includes a general grant plus specific tied amounts for mental health, palliative care, quality and access, previous specific purpose payments now broadbanded into the agreement and health system restructuring - that is, the National Health Development Fund. The total health care grant for 1998-99 is expected to be $72.4m.
The agreement also acknowledges the increasing costs on the States and Territories of the continuing decline in private health insurance coverage and includes a mechanism to increase funding for a decline beyond December 1998. Based on current estimates, a one per cent national uniform fall in private health insurance will provide $82m in additional funding nationally. The Commonwealth has also conceded that it will not claw back funds if the level of private coverage increases, until the ACT's coverage rate increases to 36.6 per cent. Although figures are only collected annually, the ACT's coverage rate at June 1997 was estimated at 34.7 per cent.
While the new agreement is primarily political, as opposed to legal, it exists so that both parties can achieve one of the core principles of this system: Choice of free hospital care for all Australians. Through the agreement the Commonwealth Government now seeks to achieve a broader range of national policy objectives for the health care system. It is important to recognise the joint role the States and Commonwealth play in agreeing and setting health policy for the nation. The agreement is structured to allow the States and Territories to move beyond the traditional approach to providing and financing health services and look for ways to restructure the system in an effort to reduce perverse incentives for cost shiftings and improve patient access to services.
The Commonwealth and the ACT have agreed to ensure that the Australian health care system is a world-class system which is based on the following principles: Firstly, eligible persons must be given the choice to receive a public hospital service free of charge as public patients; secondly, access to public hospital services by public patients is to be on the basis of clinical need and within a clinically appropriate period; thirdly, eligible persons