Hospital Funding Crisis Hits Hunter Region
Hunter New England Health is among several Australian health districts requiring financial bailouts after exceeding their budgets, according to a damning report from the Grattan Institute. The prominent think tank claims hospitals are being "held back by bogos budgets" set unrealistically low by state governments.
System Under Strain
The financial pressure comes as hospitals face overwhelming challenges including ramping ambulances, overwhelmed emergency departments, lengthy surgery waitlists, bed shortages and staff burnout. John Hunter Hospital has experienced increasing ambulance ramping, while surgeons were recently instructed to only admit patients facing "threat of limb or life loss" during extreme bed shortages.
Peter Breadon, health program director at the Grattan Institute, stated that Hunter New England represents "one of many hospital districts around the country that have often gone over their budget." He emphasized that when bailouts become annual occurrences, it indicates either insufficient initial funding or excessive costs - or both.
National Solution Required
The institute is calling for a comprehensive national funding reset to prepare for rising healthcare demands as Australians age and face increasing health challenges. Mr Breadon advocates for greater federal government contribution through the next national health funding agreement, combined with state governments providing predictable and realistic budget funding that eliminates the need for bailouts.
According to Grattan Institute analysis, $1.2 billion annually is wasted on avoidable hospital spending that doesn't improve patient care. This substantial amount could fund an additional 160,000 hospital visits each year if redirected efficiently.
Hunter New England Health CEO Tracey McCosker confirmed the financial challenges in a statement to the Special Commission of Inquiry into Healthcare Funding. She noted it's "an ongoing challenge to meet financial KPIs" and cited a budget shortfall in 2023-24 driven by increasing demand, longer patient stays, and premium labour costs.
The funding crisis has sparked political action, with Federal Health Minister Mark Butler announcing an extra $1.7 billion for public hospitals and health services in February, including $407 million additional funding for NSW. State leaders are now pressing the Albanese government to deliver billions more in promised hospital funding.
