Budget delivers surplus by cutting hospital beds

The Gillard Government has fulfilled their promise of a Budget surplus by slashing spending on sub-acute hospital beds.

Last month, Catholic Health Australia gave its support to the aged care reforms announced by Prime Minister Julia Gillard and Minister for Ageing Mark Butler, and the Budget tonight confirmed the funding mechanisms for those reforms.

"What we saw tonight was confirmation of the modest $55.2 million next year in new spending to improve an aged care system that is under immense strain," CHA chief executive officer Martin Laverty said.

"One of the great disappointments of this Budget was a $120 million cut from multi purpose services, which will mean more than 200 sub-acute beds promised as part of the Council of Australian Governments health reform agreement will now not be built."

There was also disappointment about the lack of any policy – and associated funding – to address the expected shortfall of 110,000 nurses across Australia by 2025, as a Health Workforce Australia report predicted less than two weeks ago. In fact, the Budget cut workforce spending by $68 million.

Hospitals are also concerned about the impact of the implementation of the Government's carbon tax, with both public and private hospitals expected to be adversely affected by the carbon tax and not compensated for the rising costs they will incur.

"Not-for-profit hospitals will see operating costs increase as a result of the carbon tax, but the Government has not committed to ensuring hospitals can cover those costs," Mr Laverty said. "We have no view on the merits of the tax, but we do not want to constrain health services because of a new tax."

Despite the fiscal constraints the Government placed on itself, there were some important funding injections announced tonight, including $1 billion in initial funding for the National Disability Insurance Scheme, starting in 2014, and the increase in funding for dental care, aimed at improving the oral health of lower-income Australians.

"Oral health is closely related to general health, and CHA has been pushing for a greater emphasis on improving the health of poor, vulnerable and marginalised Australians, so additional money for dental care should go some way to achieving that," Mr Laverty said.

CHA welcomed a funding boost of $50 million over four years to improve access to free bowel cancer screening for older Australians and an additional $162 million for the implementation of the personally controlled electronic health record (PCEHR) system.

Mr Laverty also welcomed Health and Hospital Fund grants to St Vincent's Hospital Lismore ($2.5 million), Mater Health Services North Queensland ($10m) and Calvary Port Augusta ($700,000), saying the investment will improve the quality of care those facilities can deliver.


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