National government to assume more responsibility for public hospitals in Australia.

government is pushing ahead with a sweeping package of reforms that would radically overhaul funding arrangements for the nation’s public hospitals. The plan would see the federal government assume primary responsibility for the cost of running Australia’s public hospitals, which have historically been administered by the states and territories. It would also set new federal pricing and performance benchmarks, and make the Commonwealth of Australia responsible for the full cost of providing primary care and aged health services. The reforms, which are currently being debated in Parliament, are the result of a two-year push by Prime Minister Julia Gillard and her predecessor, Kevin Rudd, to create a centralized set of prices and standards for the country’s public health system. But critics worry that the reforms will add even more bureaucracy to an already complex system. Australia has a relatively cost-effective health network. Per capita health spending has traditionally been about average for countries within the Organisation for Economic Cooperation and Development, above the United Kingdom but well below Canada and the United States. However, the system is facing unprecedented pressure due to rising demand from above-average rates of population growth, mainly from immigration; an aging population; and growing community expectations for technologically-sophisticated treatments and cures. Public hospital expenditure grew by nearly 10% per annum in the five years to 2007–08, according to the Australian Healthcare and Hospitals Association. Federal Treasury projections have warned that spending on health and aged care as a proportion of gross domestic product could nearly double by 2050 unless constraints are introduced. To that end, the government is seeking to establish a National Health and Hospitals Network that would bring the current fragmented, state-based system at least partially under the federal umbrella. “Australia’s health system has suffered from inadequate funding arrangements and unclear accountability for too long,” Prime Minister Julia Gillard said as her government placed the reform package before Parliament. Thus far, seven of Australia’s eight states and territories have agreed to the government’s plan, with only Western Australia refusing to participate. Nevertheless, the government has vowed to push ahead with the reforms. News CMAJ