Direction to the Independent Hospital Pricing Authority on the performance of its functions under section 226 of the National Health Reform Act 2011 - No 1/2020 (Cth)

Direction to the Independent Hospital Pricing Authority on the performance of its functions under section 226 of the National Health Reform Act 2011 - No 1/2020

I, GREG HUNT, Minister for Health, acting under subsection 226(1) of the National Health Reform Act 2011, and having consulted with the Standing Council on Health, DIRECT the Independent Hospital Pricing Authority to undertake the actions set out in the schedule to this instrument.

Dated 29 January 2020

GREG HUNT Minister for Health

1 Name This instrument is the Direction to the Independent Hospital Pricing Authority on the performance of its functions under section 226 of the National Health Reform Act 2011 - No 1/2020.

2 Commencement This instrument commences on the day after it is registered on the Federal Register of Legislation.

3 Authority This instrument is made under section 226 of the National Health Reform Act 2011.

4 Definitions Note: A number of expressions used in this instrument are defined in section 5 of the Act, including the following: (a) COAG; (b) National Health Reform Agreement; (c) Pricing Authority; (d) Standing Council on Health. In this instrument: Act means the National Health Reform Act 2011. Australian Health Ministers' Advisory Council means the advisory body established or recognised by the Standing Council on Health. cost model includes deriving cost profiles, adjustments, parameters and relative weights of classes within each service stream for a financial year, and is based on cost and activity data for each of the historical years with only those costs and activity from Activity Based Funding (ABF) establishments being used. direct cost means costs incurred at the Nationally Funded Centres (NFC) site (or sites) where the NFC episode of care is provided across more than one site) that are directly related to the NFC technology, including pre and post procedural care as captured in the National Health Cost Data Collection (NHCDC) Cost Bucket Matrix. indirect cost includes, but is not limited to, the: (a) travel and accommodation costs incurred in the Nationally Funded Centres (NFC) Program in order to access a NFC service; (b) capital costs; (c) other overhead costs that are incidental to the provision of a NFC service, as deemed by the Pricing Authority. NFC Program means the program recognised as the Nationally Funded Centres (NFC) Program endorsed by Australian health ministers in June 1990 (now meeting as the Council of Australian Governments Health Council) for the public sector provision of certain high cost, highly specialised clinical practices and technologies with limited demand. For a technology to be considered for NFC status it must require a national population base for efficient and effective service provision. NFC service means a service that is specified in a service in column 1 of an item in the table under clause 5 of the schedule. pricing model includes a National Efficient Price (NEP), Price Weights and adjustments, and is based on cost and activity data from three years prior. reference cost means a standardised mean to ensure the measure of an NWAU remains constant over time, that is then used to convert the cost model into a cost weight model and pricing model. specified site, in relation to a NFC service, means a site specified in column 2 of the table in clause 5 of the schedule for the particular NFC service.