JANUARY

AUSTRALIA
Public hospitals receive a majority of funding (91%) from federal and state governments, with the remainder
coming from private patients and their insurers. Most of the funding (62% of the total) is for public physician
salaries. Private physicians providing public services are paid on a per-session or fee-for-service basis. Private
hospitals receive most of their funding from insurers (47%), federal government’s rebate on health insurance
premiums (21%), and private patients (12%) (AIHW, 2014b).
Public hospitals are organized into Local Hospital Networks (LHNs), of which there were 138 in 2013–2014.
These vary in size, depending on the population they serve and the extent to which linking services and
specialties on a regional basis is beneficial. In major urban areas, a number of LHNs comprise just one hospital.
State governments fund their public hospitals largely on an activity basis using diagnosis-related groups.
Federal funding for public hospitals includes a base level of funding, with growth funding set at 45 percent
of the “efficient price of services” of activities, determined by the Independent Hospital Pricing Authority
(IHPA [http://www.ihpa.gov.au]). States are required to cover the remaining cost of services, providing an
incentive to keep costs at the efficient price or lower. Small rural hospitals are funded through block grants
(IHPA, 2015). Starting in July 2017, the federal government will return to block-grant funding for all hospitals.
Mental health care: Mental health services are provided in many different ways, including by GPs and
specialists, in community-based care, in hospitals (both in- and outpatient, public and private), and in residential
care. GPs provide general care and may devise treatment plans of their own or refer patients to specialists.
Specialist care and pharmaceuticals are subsidized through the MBS and PBS.
State governments fund and deliver acute mental health and psychiatric care in hospitals, community-based
services, and specialized residential care. Public hospital-based care is free to public patients (AIHW, 2015b).
The federal government has commissioned the National Mental Health Commission to undertake a review
of all existing services (NMHC, 2015).
Long-term care and social supports: The majority of people living in their own homes with severe or profound
limitations in core activities receive informal care (92%). Thirty-eight percent receive only informal assistance and
54 percent receive a combination of informal and formal assistance. In 2009, 12 percent of Australians were
informal caregivers and around 30 percent of those were the primary caregiver (carer). In 2011–2012, federal
government provided AUD3.18 billion (USD2.07 billion) under the income-tested Carer Payment program, and
AUD1.75 billion (USD1.14 billion) through the Carer Allowance (not income-tested, and offered as a supplement
for daily care). Government also provides an annual Carer Supplement of AUD480 million (USD313 million) to
help with the cost of caring. Recipients of the Carer Allowance who care for a child under the age of 16 receive
an annual Child Disability Assistance Payment of AUD1,000 (USD651). There are also a number of respite
programs providing further support for caregivers (AIHW, 2013).
Home care for the elderly is provided through the Commonwealth Home Support Program in all states except
Western Australia. Subsidies are income-tested and may require copayments from recipients. Services can
include assistance with housework, basic care, physical activity, nursing, and allied health. The program began
in July 2015 as a consolidation of home and community care, planned respite for caregivers, day therapy,
and assistance with care and housing (Department of Social Services, 2015). The Western Australian
Government administers and delivers its Home and Community Care Program with funding support from
federal government.
Aged care homes may be private nonprofit or for-profit, or run by state or local governments. Federally
subsidized residential aged care positions are available for those who are approved by an Aged Care
Assessment Team. Hospice care is provided by states through complementary programs funded by the
Commonwealth. The Australian Government supports both permanent and respite residential aged care.
Eligibility is determined through a needs assessment, and permanent care is means-tested (AIHW, 2015c).
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The Commonwealth Fund