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This page refers to the Performance and Accountability Framework, an intergovernmental document that assigned various reporting responsibilities to the former National Health Performance Authority. From 1 July 2016, activities related to reporting against the indicators contained in the Framework are the responsibility of the Australian Institute of Health and Welfare.

The Framework directly applies the RoGS framework definitions of equity, effectiveness and efficiency (and cost effectiveness) to measure performance as follows.

Equity indicators

Equity indicators measure how well a service meets the requirements of particular groups in society with special needs. Indicators may reflect both equity of access, whereby all Australians are expected to have adequate access to services, and equity of outcome, whereby all Australians are expected to achieve similar outcomes arising from service use.

  • Equity is further defined to distinguish between horizontal and vertical equity:
    • horizontal equity—the equal treatment of equals, demonstrated when services are equally accessible to everyone in the community with a similar level of need.
    • vertical equity—the unequal but equitable (‘fair’) treatment of unequals, demonstrated when services account for the special needs of particular groups in the community and adjust aspects of service delivery to suit these needs. This approach may be needed where geographic, cultural or other reasons mean some members of the community have difficulty accessing a standard service.
  • The equity domain as envisaged and utilised by the RoGS framework needs to be adapted for use within the context of the Framework. Whilst recognising the importance of the equity domain, the purpose of the PAF is not to provide detailed indicators in relation to access at the individual level, but to report on indicators of access at a more aggregate level.
  • The Framework addresses the equity domain by recognising that access to health services by disadvantaged groups such as Indigenous Australians and people in rural and remote areas is especially important to ensure an equitable health system.

Effectiveness indicators

Effectiveness indicators measure how well the outputs of a service achieve the stated objectives of that service. The reporting framework groups effectiveness indicators according to characteristics that are considered important to the service. These characteristics include access, appropriateness and/or quality.

Associated with quality is safety. Having quality health services delivered safely is paramount as it ensures public trust and confidence in the health system, and will often be a key determinant of patient outcomes. A continuous improvement culture that drives high quality health services is the foundation of health service delivery.

The Framework addresses this domain by ensuring that safety and quality data are collected, analysed and fed back for improvement, as well as comparison and accountability purposes. In addition, the Framework includes a number of patient outcome and patient experience indicators, as a measure of the health system is the benefit it provides the community and individuals.

Efficiency indicators

Efficiency indicators (the relationship of inputs to outputs) measure how efficiently the outputs of a service were achieved. Technical efficiency indicators measure how well services use their resources (inputs) to produce outputs. Government funding per unit of output delivered is a typical indicator of technical efficiency. Allocative efficiency considers the use of resources across different care/treatment domains and strategic options, including in hospitals and primary care settings. Whilst indicators of allocative efficiency are not currently well developed in health care, they will be a focus for future development.

The Framework addresses the efficiency domain through the inclusion of efficiency and financial performance indicators as well as recognising that, over time, the indicator set for LHNs and Medicare Locals should be progressively revised by the Authority and Health Ministers to measure the integration and coordination of services through the development of indicators common to both an individual LHN and its relevant Medicare Local(s).

Cost-effectiveness indicators

Cost-effectiveness indicators (the relationship of inputs to outcomes) measure how efficiently the outcomes of a service were achieved. Although no cost-effectiveness indicators are currently reported, a theoretical example would be government funding per life (or ‘quality adjusted life year’) saved through breast cancer screening.

5.1 - Assigning responsibility under the Framework

Whilst a general framework can be applied across a spectrum of activity in the system, the different elements being reported on (in this case LHNs, public and private hospitals and Medicare Locals) will have differing levels of control over factors which may impact upon the performance being measured. Therefore the indicators chosen for performance accountability purposes recognise an appropriate degree of control so as to make them meaningful for this purpose.

As Medicare Locals evolve over time, they will be given greater responsibility and be able to exert greater influence on how services are delivered in the local area. To reflect this, performance reporting on Medicare Locals will initially focus on the input and process part of the service process chain in terms of how they are run, and how well they map out the availability and distribution of primary care services in their area. However, over time, as Medicare Locals receive funding to coordinate and plan services in the community, the output part of the service process will become the focus of performance reporting.

Initially, the performance of Medicare Locals will be measured through the efficiency domain in terms of how they manage the setting up of their structures and processes. The equity and effectiveness domains will start to be measured and related back to performance once Medicare Locals begin to coordinate and plan services.

Section 6.3 lists the initial indicators proposed for Medicare Locals and their communities noting that for the above reasons they will become more refined over time once Medicare Locals become more established in their communities. The indicators are mapped diagrammatically back to the performance domains—equity, effectiveness and efficiency, but there is a clear distinction between what the Medicare Local is being assessed against and the performance of its community (which currently cannot be attributed to the Medicare Local). As such, population health outcomes for the area for which the Medicare Local is responsible will initially be measured for context setting and planning purposes, rather than for accountability.

Performance reporting for LHNs and hospitals using the RoGS framework is more straightforward given there is already an established framework, and there is broad endorsement and acceptance of it and its indicators. Section 6.2 lists the initial indicators proposed for LHNs and hospitals under the Framework and maps them diagrammatically back to the performance domains – equity, effectiveness and efficiency, which thus allow for a systematic assessment of the performance of hospital care.