NSW Management Interns' Blog

Blog posts by NSW Management Interns of the Australasian College of Health Service management


Oscar Chaffey
Oscar Chaffey

ACHSM blog

Driving continuous improvement and effective financial management

Author: James Comerford

Date: 4 April, 2018

Now that we are into the New Year, the ACHSM’s Emerging Health Leaders (EHL) events are back up and running. I was fortunate enough to attend the first EHL Breakfast held at NAB House on February 23rd where Jennifer Nobbs, Executive Director of the Independent Hospital Pricing Authority (IHPA) was our guest speaker. The seminar focused on driving continuous improvement and effective financial management throughout our health system, whilst giving a great overview of Activity Based Funding (ABF) and the challenges that may lie ahead. 

I am currently a member of the ACHSM as a part of the Health Management Internship Program (HMIP) run throughout Australia. Having just started my second and final year of the internship, I see these EHL events as valuable opportunities to expand my contextual knowledge, as well as build relationships and network with individuals from other facilities and organisations. This event was particularly important for the new first-year HMIP Interns since it presented an opportunity to mix with other ACHSM members, as well as gain a strong understanding in the role that IHPA plays throughout our health system. 

Whilst taking us back through the somewhat short life of IHPA, as well as giving us a quick overview of Activity Based Funding, Jennifer very quickly highlighted the importance that IHPA plays in the continuous improvement of financial management in health. The main take-home message is that IHPA has achieved its overall goal of slowing down the cost of health service activity (measured in National Weighted Activity Unit, or NWAU) since its introduction in 2011. 

What I found extremely useful throughout the presentation was the clear breakdown of funds that are allocated for events of differing complexity, ranging from a non-admission consultation to a complex hip replacement for a patient with certain comorbidities. This highlights the importance of capturing accurate data to ensure that the correct funds are being allocated to our services. Clearly, coding plays a very important role in this and whilst Jennifer was able to highlight that IHPA has achieved its goal in slowing the cost of NWAU, she also stipulated that there is room for even more improvements in the system that will ultimately lead to more effective and efficient care to a wider population. 

At this stage, Hospital-Acquired Complications (incidents and health complications that are avoidable) are still prevalent in all hospitals around Australia, costing time and money and ultimately leading to a reduction in activity-based funding. Patient falls and infections are the most prevalent examples of the complications that need to be addressed to ensure that hospital facilities are being appropriately compensated for their treatment and care.

Although the current ABF model is succeeding throughout Australia, Jennifer touched on a slightly varied model that has been recently implemented throughout our health system to improve care and strive for better patient outcomes. Funding for some services is now being given based on outcomes rather than just raw activity data. This signifies a change in the overall mindset towards funding in the health sector, in that we should now be looking to focus on value-based care rather than volume based. This will ensure that we continue to strive for the best possible patient outcomes at our facilities and that the funding model can thrive into the future.

It was a great morning and it was great to see such a diverse attendance for the first EHL event of the year. It was also great to see some of the first-year HMIP interns as they begin their journey into health leadership.

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