Hospitals are being forced to cover severe funding shortfalls in NSW by raising hundreds of millions of dollars in external revenue, the state’s doctors say.
They have called on the state government to urgently freeze so-called “revenue targets”, which are growing at a faster pace than overall health funding.
The call is part of a broad platform of election priorities to be released by the NSW arm of the Australian Medical Association on Tuesday.
The doctors say that, particularly in western Sydney, hospitals are becoming swamped with increasing numbers of people suffering serious conditions, at the same time as federal health cuts are creating chaos and uncertainty.
AMA NSW head Saxon Smith said the external revenue was raised through measures such as increasing the numbers of private patients treated in public hospitals and through fundraising drives.
“It takes hospitals away from what their core business is, and that is delivering health services,” he said. “Most donors are also giving [while] thinking that they are supporting cutting-edge treatments, something extra, not general revenue to keep the place running.”
The AMA says the revenue targets are making up an increasing proportion of the budgets of local health districts across the state.
Districts were expected to raise $1.8 billion from external sources when the state government was first elected. Four years later, the target is $2.4 billion.
“This growth in the revenue targets is outpacing the growth in total health funding,” the AMA statement says. “We note the comment in the government’s pre-2011 policy document that revenue targets ‘are used to cover up budget cuts, and sometime result in beds being closed as targets are unrealistic’.”
In 2014-15, budget papers show the state’s local health districts will be expected to find more than 12.5 per cent of their budgets from the “sale of goods and services”, the AMA says.
The AMA says the increasing reliance on external revenue has come as federal health cuts and increasing health problems in the community have created a perfect storm for hospitals in Sydney’s west.
Dr Smith said “buck passing” and cost shifting between governments was having a disastrous effect, with the federal government ripping nearly $17 billion out of the state’s hospitals up to 2020, and pulling back from an agreement to fund additional activity in areas where hospital treatment was increasing.
“The basis of health funding from the Commonwealth beyond July 1, 2017 is more or less a complete mystery,” the AMA documents say.
“In health planning terms, two years is the blink of an eye. This lack of funding certainty makes it impossible for NSW to plan beyond 2017.”
AMA councillor and western Sydney surgeon Fred Betros said hospitals in his area were coping as best they could given a huge increase in very unwell patients needing help.
Since 2010, the numbers of the most dangerously ill patients attending the state’s hospitals have increased by a third.
“I think we are significantly underfunded and under-resourced for the number of people we are dealing with,” he said. “You pare things back to the bone until you simply can’t get any more out of it, and that is what we have done.”
However, AMA councillor and Mt Druitt GP Kean-Seng Lim congratulated Health Minister Jillian Skinner over her push to better integrate hospital and community care.
He said more should be done in that area.
He said hospital treatment in western Sydney was growing at 2.5 times the rate of population growth, and it was largely because of preventable illness related to diabetes, and lung, heart and kidney disease.
“If you have got diabetes and are admitted to hospital, you have a one in four chance of being readmitted within 28 days,” he said. “To make a difference, we need to work with the whole system.”