Labor's landmark reforms to the Australian health system are beginning to take shape, says Stephen Jones MP.

NEVER HAVESOMANY ANGRY WORDSbeen said in support of a piece of legislation by those on the other side of the chamber. I am delighted to be speaking on this bill because it is a part of an important package of reforms that the Gillard Labor government has underway.

Since coming to office, this Australian government has been working hard to deliver better health services for the Australian community and to work with the state governments to deliver better hospital services to our community. Most importantly, these changes are benefiting patients right now in hospitals and medical centres around the country including in my electorate, in Throsby in southern New South Wales.

The reforms are significant.

In total, the Commonwealth is investing an additional $19.8 billion in hospital services over the decade. This stands in stark contrast to the situation we found ourselves in when we took office in 2007, because it came after a decade of those who sit opposite bleeding the health system of fundsover a billion dollarsthat should have been spent on fixing up the mess in our public hospital system and training more doctors and nurses, and we have had to fix this mess up.

We now have a truly national health reform agreement with every state and territory government signed on, on board and committed to improving hospital services and health services in our community. We have local hospital networks across four states.

We have established new subacute beds opening in every state. We have 19 Medicare locals operating across the country, with more to come in the coming months.

I was very pleased that, when the Minister for Health and Ageing visited my electorate and the electorate of my colleague the member for Cunningham this week, she was able to announce that the Illawarra Division Of General Practice had been awarded the contract to operate the Medicare local in our electorates and in our regions. That is great news for the Division Of General Practice and great news for the residents and citizens of the Illawarra.

We have a GP after-hours phone line that has already taken over 41,000 calls, and we are connecting patients in regional and outer-metro areas with medical specialists through telehealth and videoconferencing.

I am delightedprobably more delighted than the member for Gilmore, in whose electorate the town of Kiama existsthat it has been selected as one of the trial sites for rolling out the government's new telehealth and videoconferencing facilities. This joins up, of course, with that other great government initiative, the National Broadband Network, to ensure that Australians, wherever they are around the country. Whether they are in Dapto in my electorate, in Kiama in the member for Gilmore's electorate, in a town in the electorate of my colleague here the member for Braddon or in the inner leafy suburbs of Sydney or Melbourne they have access to some of Australia's finest medical minds through NBN enabled telehealth and videoconferencing facilities.

It does not stop there. We have finalised the plans for e-health records, with the national infrastructure now being built. We cannot underestimate this, because a number of Australians do not consult a consistent medical practitioner week in, week out, year in, year out, for a range of reasonsthey may move around and live in different places or consult different medical practitioners depending on where they are when they have an ailment. Having an infrastructure in place which enables records to transfer the record of that patient around literally saves lives, and it certainly saves thousands and thousands of dollars.

We also have a $2.2 billion mental health package, the biggest in our nation's history, and there is also much, much more happening. We have doubled the number of doctors and nurses in training, which is going to make a significant difference. We are going to be able to fill that gap that many members in this place are very aware of: the gap in the demand for GP services and the number of GPs available to service that demand.

The bill before the House is another piece in this puzzle. It will bring into effect yet another key part of the government's national health reform agenda.

It establishes the Independent Hospital Pricing Authority. Through this bill it will help to deliver a more sustainable, efficient and transparent health system for all Australians. The main purpose of the pricing authority is to promote improved efficiency in, and access to, public hospital services by providing independent advice to governments in relation to the efficient costs of such services, as well as developing and implementing robust systems to support activity based funding for such services.

The main functions of the pricing authority are, amongst other activities, to determine the national efficient price for healthcare services provided by public hospitals, to develop and maintain costing and classification specifications, to determine standards and requirements from public hospitals, and to provide recommendations in relation to cost-shifting and cross-border disputes. In addition, the pricing authority will be required to publish this and other information for the purpose of informing decision makers in relation to the funding of public hospitals.

A key part of the National Health Reform Agreement that was reached with all states and territories on 2 August this year is the introduction of activity based funding, which will occur from 1 July next year. The introduction of activity based funding was a key recommendation of the National Health and Hospitals Reform Commission's report.

From 1 July 2014 the Commonwealth will pay 45 per cent of the efficient cost of growth in hospital costs, and from 1 July 2017 this will increase to 50 per cent. The very real impact of this is that we will be relieving state governments of the great burden of the increasing cost of health care, particularly hospital care, funding, which is projected to well exceed their projected revenues by 2035 unless some other system is put in place. The bill creates a new independent umpire, the Independent Hospital Pricing Authority, who will set the efficient price and advise governments on the implementation of this measure across Australian hospitals.

This bill is a direct result of the Council of Australian Governments agreement with all states and territories. The Commonwealth will be a true partner in the hospital system, with a commitment to funding 50 per cent of the growth funding for hospital services. This extra growth funding will apply to the increase in the cost of services as well as the increasing demand for new services with the ageing of the Australian population. This commitment to growth is vitally important as the states will not have, as I said, the capacity to fund the increasing cost of services on their own. It also creates a better incentive for the Commonwealth to invest in primary and preventative health services to keep people healthy and out of hospital.

These reforms will help to ensure that hospital financing can be dynamically adjusted to accommodate shifting populations, local demographic characteristics, changing costs of delivering medical services from technological and clinical innovation, and the complexity and location of delivering hospital services. It is important to note that small regional and rural hospitals are protected under the new financing arrangements, because although we are introducing case based funding to the hospital networks the use of block funding where activity based funding would not be appropriate will be introduced and will ensure that small rural and regional hospitalsand I have a few of them in my electorateare funded to deliver on community service obligations.

As I said, last week I had the pleasure of welcoming the Minister for Health and Ageing to the Illawarra, to my electorate of Throsby. When we were there we had the pleasure of opening the new GP superclinic at Shell Cove.

This is an investment of over $2.5 million, to provide GP services to this high-growth area in the Illawarra. It is an announcement that was very well received by the entire community and, I have to say, even by the member for Gilmore, who was there at the opening.

Speech to Parliament - Second Reading - National Health Reform Amendment (Independent Hospital Pricing Authority) Bill 2011