Final Report on RREF 2001 - Department of Health

Executive Summary
All regions will continue to receive growth funds under a revised RREF and reallocations
between regions compared to outcomes under continuation of the current RREF are relatively
minor. Further, modelling of reallocations showed a mixed pattern across rural and
metropolitan regions rather than a simple rural-metropolitan divide.
The much larger populations of the metropolitan regions meant that most reallocation was
between the metropolitan regions. Outcomes for rural regions generally resulted in lower levels
of growth funding, in part reflecting population trends. It was also argued that the allocation of
resources through the RREF alone failed to take account of factors that increased the cost of
service delivery in rural areas and that higher performance targets associated with RREF
allocations could impose additional burdens on rural regions. Supplementary measures that
could recognise these rural cost factors are taken up under Term of Reference 5 below.
Adoption of a revised RREF would change the level of per capita funding that defined equity
and so redraw the equity line for the base funding that each region received. Recognising that
reallocation of growth funds would bring about adjustments in the base funding only very
slowly, the relationship between growth funding and base funding was raised in the Round 2
Consultations.
2. The national context for resource allocation in aged care and
Commonwealth planning processes
The RREF Review has been undertaken in the context of continuing debate about the
Commonwealth strategy for equalisation of HACC funding per capita of the target population.
The Review has identified a number of issues that the Victorian Government needs to take up
with other States and the Commonwealth, including:
• The options developed for operationalising the definition of the HACC target
population;
• The contribution of the RREF Review to the development of resource allocation
formulas in other states with a view to maintaining national consistency; and
• The need for continuing liaison with the ABS with regard to optimising the value of
the next Survey of Disability, Ageing and Carers for the HACC program and related
programs.
3. The basis on which the target population for HACC services is
measured
Step 1 in developing options for a revised RREF focused on alternative approaches to defining
the HACC target population and these issues and the options that emerged are presented in Part
B: Step 1 of this <strong>Report</strong>.
The main basis for the definition of the target population as adopted in HACC nationally is the
population identified as having moderate, severe or profound activity restrictions in the 1998
ABS Survey of Disability, Ageing and Carers. The Review addressed a number of concerns
expressed in the field about this data and noted several strengths of the DAC survey that make it
the most appropriate base for measuring the HACC target population.
<strong>Final</strong> <strong>Report</strong> July 2001
vii