The federal government's plan to take control of hospital funding will be more transparent than the current state based model, particularly in NSW, surgeons say. The Royal Australasian College of Surgeons also said the plan had the potential to improve health care outcomes by introducing national accountability standards.
"For too long state governments have often responded to injections of federal funding into the health system by quietly cutting their own health expenditure," college president Professor Ian Gough said in a statement.
"Such sleight of hand has been particularly prevalent in NSW and the results are there for all too see - a public hospital system on the verge of collapse.
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"A single funding source would put an end to such practices."
Under its plan, the federal government will take majority control of the hospital system and full financial and policy responsibility for general practitioner and primary care services.
It will fund 60 per cent of all public hospital services and set up local hospital networks comprising small groups of hospitals that will manage their own budgets.
The changes announced on Wednesday will amount to a $49.6 billion takeover of state and territory funding responsibilities, including $30.9 billion for public hospitals and $18.7 billion for GP and primary care services, through the application of about 30 per cent of GST revenues directly to health spending.
Federal, state and territory governments will discuss the issue at the next Council of Australian Governments gathering in April.
But Prime Minister Kevin Rudd has warned if they do not agree to the handover, he will take it to the nation at the next federal election.
Prof Gough said he was concerned, however, that the plan did not address the role of teaching in public hospitals.
"The looming crisis in healthcare workforce numbers will not be addressed by a funding arrangement which merely focus on the treatment of today's sick and ignores the need to train more specialists in our hospitals," he said.
Bligh backs plan
The Queensland government has promised to work with the federal government on health care reform to improve treatment for the state's patients.
Premier Anna Bligh said her government would take a number of weeks to digest the complex package, but would cooperate.
"We think this is a once-in-a-generation opportunity to improve the public health system in Queensland," she told reporters in Charleville.
"You need to get the balance right between efficiency and good value for money for taxpayers and great care for patients."
Health Minister Paul Lucas welcomed the announcement, saying Australia's aging population was growing at such a rate that the states would simply not be able to fund their health systems in the future under current arrangements.
"The most important part of what is in this is that finally a federal government has said they will be responsible for growth in demand," he told reporters in Hervey Bay.
Mr Lucas said hospitals did need to operate in networks, particularly in a decentralised state where patients were transferred from hospital to hospital, and he looked forward to seeing the detail of the proposed hospital networks.
He also wanted to see the detail of funding allocations as he had some concerns about comparing regional Queensland hospitals of like size to city and interstate hospitals.
For example, specialists were paid more in regional areas to attract and retain them and so the plan would need to take into consideration the differing costs associated with doing business in different places, he said.
"We want to make sure that Queensland's unique regional status is understood," he said.
WA mulls package
The West Australian government will consider the federal government's planned overhaul of public hospitals carefully but will seek to protect the state's finances, Premier Colin Barnett says.
Mr Barnett says WA has a good public hospital system and should not be judged by the failures of the NSW and Queensland systems.
He felt the concept of a national pool had some merit but WA had already been "done over" with the GST carve-up.
The state would only commit to the national pool if it had a true and effective say in public health policy, commensurate with the level of funding.
Mr Barnett said he did not believe a referendum would succeed and that in a conversation with Kevin Rudd on Wednesday he had assured the prime minister he would analyse the plan carefully.
"I said (to Mr Rudd) we would take a sensible, careful approach," Mr Barnett told reporters in Perth.
Mr Barnett said it would be easy for him as the only Liberal premier to attack the plan but he was committed to assessing the merits of the plan.
He also said the prime minister would have to gain the support of the states and territories.
"He'll need to do it by co-operation, not force," Mr Barnett said.
For the commonwealth to acquire the states' hospitals by force would be breaking the law, Mr Barnett added.
"They are our hospitals, we own them."
Northern Territory agrees 'in principle'
The overhaul will have the support of the Northern Territory government so long as it meets the needs of remotely located and indigenous Australians, the chief minister says.
Paul Henderson told reporters that he spoke to Prime Minister Kevin Rudd about the reform and had offered his support.
"He assures me that in terms of the funding, it will recognise disadvantage (among Aborigines) and geographical disadvantage," he said.
"This has got to be about increasing funding for our hospital system.
"For 11 years John Howard ripped over a billion dollars out of our hospitals in Australia and in the Northern Territory."
He said hospitals in the Northern Territory were the busiest of any in the country, on an admissions per capita basis.
"Running a hospital in Darwin or Alice Springs is not the same as running a hospital in the ACT.
"What we don't want is a one size fits all approach.
"If this reform means additional funding then I'll welcome it, but we're still waiting to see the detail."
A spokesman for Mr Henderson said that once they received specific final details about the reform, the NT government would have until after the next COAG meeting in April to make a formal decision.
