Two more states sign on to hospital agreement

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Health minister Greg Hunt has secured the agreement of two more jurisdictions to the new five-year hospital funding agreement starting in 2020.

The Northern Territory and Tasmanian governments have signed onto the new agreement that will provide the states and territories almost $128 billion for public hospitals over five years, an increase of $30 billion on the current agreement.

The increase in the federal government's commitment to public hospital funding over the five years will be roughly equivalent to its total spend on the private health insurance rebate over the same period.

Six of the eight states and territories have now signed up to the agreement, with the Northern Territory and Tasmania joining South Australia, the ACT, New South Wales and Western Australia.

Health minister Greg Hunt said the Turnbull government does "stand ready to deliver record funding" to Victorian and Queensland hospitals.

The Victorian government has argued the new agreement, based on a 6.5 percent annual increase in federal government spending, is not sufficient because of the state's rapid population growth.

The Queensland government is seeking a $460.6 million 'back payment' from the federal government for the 2016-17 financial year. The Independent Hospital Pricing Authority has not yet made its assessment for that year. 

Health minister Greg Hunt has said the federal government will aim to use the new agreement to address the practice that is forcing up private health insurance premiums.

The agreements include specific measures to resolve the practice of states 'harvesting' privately insured patients through their accident and emergency wards. 

Under the agreements, governments will, "...develop reform initiatives to improve admission policy and practices to support patient choice, and to deliver comprehensive data provision and more consistent financial reporting on private patients." 

Recent data has shown rapid recent growth in the number of public hospital separations funded by private health insurers, leading to upward pressure on premiums.

In South Australia, one hospital uses 'Patient Liaison Officers' to encourage patients to elect to use their private health insurance, for the explicit purpose of revenue raising. Patients are admitted as 'private for accommodation only', meaning they have no choice of doctor, are treated as a public patient, and the only purpose - stated - of electing to use their private health insurance is to raise money for the hospital.

Under the new agreement, governments will, "...develop reform initiatives to improve admission policy and practices to support patient choice, and to deliver comprehensive data provision and more consistent financial reporting on private patients."