Public and private hospitals are funded from a range of different sources, reflecting the types of patients they treat and the services they provide. Governments mainly fund emergency department and outpatient services, whereas admitted patient services are commonly funded by private (non-government) sources, as well as government sources.
The sources of funds reported here are the original sources rather than immediate sources. Hence, the Australian Government is regarded as the source of funds for the contributions that it made for public hospitals via the Australian Health Care Agreements, even though the funds were provided to state and territory governments for their spending on public hospitals. The Australian Government is also regarded as the source of funds for the contributions it made to private hospitals via the private health insurance premium rebates, even though the funds were provided through health insurance funds or their members.
In general terms, the state and territory governments and the Australian Government provide most of the funds for public hospitals (Figure 9) (AIHW 2010). The proportion of funding that was from the Australian Government declined between 2004–05 and 2006–07, then increased in 2007–08 (Figure 11). Private health insurance and out-of-pocket payments by patients mainly fund private hospitals (Figure 10).
Figure 9: Funding sources for public hospitals, 2008–09
Figure 10: Funding sources for private hospitals, 2008–09
Figure 11: Funding sources for public hospitals, 2004–05 to 2008–09
