TABLED PAPER: Report on The Commission on Delivery of Health Services in Tasmania

June 3, 2014

Mrs ARMITAGE (Launceston ) - Mr President, I thank the honourable member for Murchison for listing The Commission on Delivery of Health Services in Tasmania report for discussion. It makes interesting reading.

Nowhere in this report does the commission suggest the governance of the THOs be reduced from three THOs to one. There are many recommendations that the current system requires reorganisation and refinement, but at no point is there a recommendation to go from three to one, and in fact, quite the opposite, as on page 32, in the second-last paragraph, the report warns against major structural change. The report states:

While ensuring the most appropriate structure and configuration of a health system and its methods of service delivery is undoubtedly important, we are of the view that implementing major structural changes in response to perceived deficiencies will not provide a cure-all, particularly when underlying issues of governance remain unaddressed.

Footnote 84 states:

As noted in the Final Report of the Mid Staffordshire NHS Foundation Trust Public inquiry, 'system or structural change is not only destabilising but it can be counterproductive in giving the appearance of addressing concerns rapidly, while in fact doing nothing about the really difficult issues which will require long-term consistent management.'

The commission report goes on:

It is partly for this reason that we are not recommending another round of structural change at this time. However, we have identified several governance issues within Tasmania's health system, many of them longstanding, which require resolution.

The new Liberal Government and the new Health minister, Michael Ferguson, are in the unenviable position of perhaps feeling they need to respond not only to this report, but also the diabolical state of the Royal Hobart Hospital redevelopment, the Integrity Commission report regarding THO South and THO North-West, the massive Federal budget reductions and the state Budget, which of course is yet to be announced.

It appears we could be facing a perfect storm or, in other words, an especially bad situation caused by a combination of unfavourable circumstances. It is hoped the new government and Health minister will resist making change for change's sake. It is also hoped they will not feel pressured into making a hasty decision to appear responsive, which could be costly in both human and capital terms, and plunge us back into the dark old days of DHHS Hobart-centric domination under a new name.

Change is always costly and change for change's sake is pure stupidity. We need to steady the ship. Yes, we have had problems with THO South and THO North-West, but that does not mean we throw the baby out with the bathwater. We had a rare opportunity to fundamentally reform health delivery in Tasmania, and in many areas it has worked. THO North is generally doing very well, meeting most KPIs, and they have a plan in place to meet those they are not currently meeting. Why would we put this all at risk by placing all under one THO or back under DHHS? When the Launceston General Hospital was under DHHS they were not delivering a balanced budget or achieving the same outcomes they are now. By all accounts, under the current THO system the LGH is doing very well. If you combine services, history tells us resources will go to where the problems are. No-one is saying that savings cannot be made by collaboration, particularly in the areas of payroll, IT and perhaps HR, but it is essential that each region retains its autonomy. It is also essential that communities and clinicians have a say in how their hospitals are run.

With regard to the areas of HR and payroll, the report states:

Our initial research into the operational efficiency of the Tasmanian health system highlighted Human Resources, Payroll and Population Health as areas requiring urgent review to address inefficient and ineffective practices.

The outcomes were largely positive, with staff members welcoming a long overdue opportunity to review and reassess their processes and priorities. Participants from Human Resources (HR) and Payroll Services worked willingly and collaboratively to develop ways to increase efficiencies, and identify practical steps to implement in the short term.

This process revealed a system that has multiple inefficiencies and is burdened by overly complex, bureaucratic, out-of-date practices that remain in place purely because they have evolved over time, without ever being assessed for practicality or efficiency.

I believe there is an opportunity within our current three-THO structure to look at HR, payroll and IT areas, with a view to achieving more streamlined and effective outcomes. THOs were to be single or small groups of public hospitals with a geographic or functional connection, large enough to operate efficiently whilst at the same time providing a reasonable range of hospital services.

A local hospital network, or THO with clinician and consumer input, devolves the decision making process to the locals rather than having it prescribed by a distant bureaucracy. Local clinicians are community representatives and are best informed as to the needs of their community, as well as how and where to provide it. This is not about being parochial, this is about local responsiveness to local need and accepting that there is an appropriate role for statewide and planned service delivery models, including collaboration and communication.

The state naturally falls into three population centres and each has significantly different challenges in healthcare delivery, so it is therefore imperative that we have a local model in the south, a local model in the north-west and a local model in the north.

It is quite an interesting report because it is very confusing and often contradictory. Some excerpts from The Commission on Delivery of Health Services in Tasmania report on page 56 are:

We are concerned that, despite high levels of access block and overdue elective surgery patients, there is not yet broad acceptance that the health system requires significant change to improve its performance and sustainability.

... Through this process of problem identification, pinpointing specific areas for improvement, broader acceptance of the need for change is likely to occur. There are a number of areas that require an immediate focus on clinical redesign.

On page 59 it says:

Clinical leads and redesign leads will be funded and embedded within each hospital to support and champion the redesign projects and to drive the required changes.

On page 74:

3.5 Clinical engagement

Key findings

There is significant cynicism among Tasmanian clinicians about the ability to successfully implement change within the current governance structure.

" Despite this cynicism, there are projects under way that will, if implemented effectively, greatly increase clinical engagement.

" The THO Governing Councils provide a clear opportunity to engage clinicians directly in management of the health system and decision making processes.


" National and international programs of clinical engagement can provide examples for Tasmania to follow and build upon.

On page 84:

3.7 Changing culture

Key findings

" Poor leadership, bad behaviour and longstanding cultural attitudes are at the core of Tasmania's inability to achieve both effective governance and sustainable change in its health system.

But where is the evidence?

" The Tasmanian health system currently suffers from a deeply engrained culture of resistance to change, evidenced by the system's inertia in the face of several reviews recommending reform.

" Stronger leadership, particularly from THO Governing Councils, is required to drive the changes that will lead to a more cooperative, collaborative culture-transcending organisational and regional boundaries.

It is not saying disband THOs; it is saying that stronger leadership is needed by the governing councils.

" Difficulties with engaging clinicians in reform processes are compounded by their perceptions that their advice has been ignored in the implementation of previous reviews of the health system.

" A more robust culture is required, in which successes and failures are rapidly identified as learning experiences that can improve day-to-day operations and management.

There are several problems of leadership at all levels of Tasmania's health system that must be addressed if the necessary improvements are to be realised.

A well-led health system is characterised by mutual respect, a willingness to listen and a shared common purpose. Tasmania's health system leaders need to cooperate in forging this common path, with a leadership culture that is collaborative, inclusive and united around the aim of improving patient outcomes. Three truly local hospital networks finely attuned to local needs have the best chance of addressing the unique demands and difficulties of each region. Decision-making will be as close as possible to the point of delivery.

The argument that three THOs will be costly compared to one is superficial. Local health networks save money; they have local people on the ground eliminating waste and ensuring efficiency. Anyone who argues that one will be more efficient than three needs to show some evidence, not generalisations. Would one THO simply mask the inefficiency of the other two? Is this an argument about protecting inefficiency? If we allow only one THO I believe that nothing would change. The DHHS would morph into the THO and all the problems of centralised control in Davey Street would continue.

The idea of truly local THOs was to move the bureaucracy to the site of the clinical action and make the process cleaner, more responsive and more transparent. The reason regions argued so strongly for three THOs is accountability. Interestingly, THO North and THO South are now below the national efficient price so, by definition, other than THO North-West, they are now below the national average cost price; they are achieving. I am interested to know how many consultancies the commission used to inform this report. The number, the cost and the outcomes of all this work need to be revealed.

The commission report is far from evidence-based and recommendations often start with, 'It is our view' or 'We believe'. The commission has not addressed its own terms of reference and after two years they are no closer to identifying reported cost differences in health areas or what we need to do about it. All they have done is make broad statements and question the data. There is a suggestion of the need for investment in the capacity of the Tasmanian health system to undertake clinical redesign.

This was followed by consultation with stakeholders in Tasmania in early 2013, which highlighted the need for an independent statewide approach. On this basis, we endorsed the University of Tasmania as the most appropriate independent organisation for the development, delivery and governance of a statewide clinical redesign program. The program will involve the THOs and health care providers across the state. This is certainly not saying, 'One THO'. This is about clinical redesign, working with the three THOs. On 31 May in The Examiner report, editor Martin Gilmour summed up well:

One of the obvious concerns now will be a push to eliminate the three Tasmanian Health Organisations and restructure them back into one.

From all reports the Northern THO is performing extremely well and meeting all of its benchmarks and budgets.

John Kirwan is highly regarded, both from outside and within the LGH, and yet it took significant pressure to get the former government to renew his contract.

To penalise the standout THO and hospital because of dysfunction elsewhere would be a retrograde knee-jerk reaction that might satisfy some Hobart bureaucrats wanting a bigger slice of control.

There is also the fear that patients and staff will lose faith in a health system that largely delivers outstanding results from extremely dedicated doctors, nurses and administration staff.

Health is the biggest budget line for the state government and with medical inflation running at nearly 10 per cent, it can gobble up incredible funds.

It needs to be efficient and it needs to be accountable but if you believe the Integrity Commission report there are serious concerns on both fronts.

The push from three THOs to one is alarming and I believe it will compromise the ability of the three regions to respond to the needs of the community they serve and to respond with day-to-day decisions on the operations of the local hospital. To be able to deliver the agreed services and meet performance standards, each THO should operate independently.

The establishment of three Tasmanian health organisations within the bill was the result of extensive advocacy and lobbying from a broad cross-section of the Tasmanian community. This lobbying and advocacy reflected the extreme concern of many people expert in the administration of health networks and the provision of health services to the community, indicating that administration of health services at the closest point to the service recipient has been internationally proven to provide the most outstanding health outcomes and patient care.

Throughout the report the commission refers to THOs, and at no time stated three THOs should become one. But of course people will perceive from it what they want, particularly if they have always wanted one THO. In fact, recommendation 2.1 on page 36 states:

That there be individual Chairs for each Governing Council, who are local to the respective region of Tasmania, with their selection dependent upon the possession of prerequisite skills and experience in corporate governance; not limited to expertise or experience in the health sector.

Recommendation 2.2 is:

That the Minister mandate regular meetings between the three THO Governing Council Chairs for deliberation on statewide and inter-regional matters.

Does this sound like a recommendation for one THO? Recommendation 2.3 is:

That the Minister expand the membership of each Governing Council through the appointment of at least two new members, and ensure appropriate secretariat support for each council.

Recommendation 2.5 is:

That the Minister appoint a Ministerial Representative to support the three Governing Councils, in accordance with the THO Act.

On page 47 of the report, under Opportunities for Improvement, it states:

While we recognise that the implementation of the DHHS/three THO model in Tasmania is still in its early stages, it is our view that improvements can be made through review of core operational management processes to address any duplication and inefficiencies.

Obviously, with collaboration and working together efficiencies can be achieved, and perhaps THO North can be a model for THO South and THO North-West.

Mrs Taylor - I am glad you are not being parochial.

Mrs ARMITAGE - I am not, I am being quite factual. Mention is constantly made throughout the commission report of the continuation of three THOs. This extensive review is against changing from three THOs, and if the Health minister and current Government make this change of three to one THO, they will be rejecting the views of their experts.

 

 

 

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