Prepared by Dr Teresa Anderson Chief Executive

July 2010

2011/12 Service Agreement SLHD

Performance Framework • New Performance Management Framework which specifies

targets and goals and measures relative performance.

It assumes significant LHD autonomy as to how it will achieve performance and service expectations

It specifies the key minimum performance standards and thresholds, and specifies what level of performance will trigger closer Ministry support and scrutiny

It aims to create transparency of expectations. But leave Districts free to identify other areas of performance important for our local communities and clinicians

A framework has been developed to provide a consistent approach for working with Affiliated Health Organisations

Performance Framework

provides a clear and transparent outline of how the performance of Local Health Districts is assessed

outlines how responses to performance concerns are structured.

It provides a single, integrated process for performance review, escalation and management, with the over-arching objectives of improving service delivery, patient safety and quality.

The objectives of the LHD Service Agreement

To enable the Local Health District to deliver a coordinated, high quality health service to the communities serviced by the District and to support its teaching, training and research roles.

To clearly set out the service delivery and performance expectations for the funding and other support services provided to the District.

To promote accountability to Government and the community.

The objectives of the LHD Service Agreement

To ensure NSW Government and national health priorities, services, outputs and outcomes are achieved.

To establish with the Local Health District a Performance Management and Accountability System that assists the achievement of effective and efficient management and performance.

To provide the framework for the Local Health District Chief Executive to establish service and performance agreements within the Local Health District.

The objectives of the LHD Service Agreement

To facilitate the progressive implementation of a purchasing framework incorporating activity based funded services

To address the requirements of the NHRA in relation to Service Agreements, noting that the requirements will commence at different stages over a number of years.

Strategic Directions- Quality and safety

Priorities for all LHD

– Accreditation of Health Services

– Patient Satisfaction

– Patient Safety

SLHD additional priorities:

– Infection control

– Conscious sedation

– Clinical Handover

– Surgical/Procedural supervision

Strategic Directions- Patient Flow

Priorities for all LHDs

– Surgery Emergency Surgery Guidelines/ Predictable Surgery Program

– Patient Flow Systems and Predictive Capacity Planning

– Models of Care

– Integrated Clinical Service Networks and Plans

– Appropriate Utilisation of Hospitals

– Community Health Services

Strategic Directions- Patient Flow

Priorities for all LHDs

– Mental Health

– Aboriginal Health

– Dental Health

SLHD’s additional priorities:

– Ongoing Networking with SWSLHD

Strategic Directions- Finance & Management

Priorities for all LHDs

– National Agreements and Initiatives

– Performance Management Framework (PMF)

– E-Health Information and Communications Technology (e-health ICT)

– Workforce Action Plan

– Best Practice Financial Management

– Activity Based Funding costing.

– NSW Public Sector Workplace Health and Safety and Injury Management Strategy 2010 – 2012 -

Strategic Directions- Finance & Management

SLHD’s additional priorities:

– Staffing levels

– Workforce Development – continued implementation of programs to develop managers for the future including the DBA, Masters of Business Administration, Masters of Clinical Management and the Postgraduate Management Program

– Business Management

Strategic Directions- Population Health

Priorities for all LHDs

– Population health - Provide preventive care

– Connecting Care Program

– Aboriginal Health Strategies

– Keep Them Safe

– Emergency Response Planning and Readiness

SLHD’s additional priorities:

– Out of Home Care

– Aged Care

– Chronic disease management

KPIs Target

Not Performing

X

Underperforming

Performing

Safety and Quality

Tier 1

Staphylococcus aureus bloodstream infections (SA-BSI) (per 10,000 occupied bed days)

2 > 2.5 > 2 and < 2.5 < 2

Tier 2 Central Line Associated Bloodstream (CLAB) Infections (number)

0 > 1 N/A 0

Tier 2 Incorrect procedures (operating theatre) resulting in death or major loss of function

0 > 1 N/A 0

Patient Flow

Tier 1 Ambulance Transfer of Care - < 30 minutes (%)

90 < 75% > 75% and < 90%

> 90%

Tier 1

Emergency Department Triage 3 – Cases treated within benchmark times (%) (within 30 minutes)

75 < 70% > 70% and < 75%

Target of 75% met or better

Tier 1

Emergency Admission Performance - Patients transferred to an inpatient bed within 8 hours of arrival in the ED (%)

80 < 75 % > 75 % and < 80%

> 80%

Tier 1

Overdue planned surgical patients (number):

• Category 1

0 > 5 >0 and <5 0

• Category 2 0 > 25 >5 and <25 <5

• Category 3 0 > 25 >5 and <25 <5

Tier 1

Unplanned hospital readmissions within 28 days of separation (%):

< Previous year

> 2% points above previous year

< 2% points above and >

previous year

< Previous

year

[

Patient Flow

Tier 2 Patients staying in ED > 24 hours (number) 0 > 5 > 1 and < 5 0

Tier 2 Planned Surgery – Activity against target 24,000 > 2% less than

target < 2% under

target Target met

or better

Tier 2

Emergency Admission Performance - Mental health patients transferred to an inpatient bed within 8 hours of arrival in the ED (%)

80 < 75% > 75 % and < 80%

> 80%

Tier 2 Mental Health presentations staying in ED > 24 hours (number)

0 > 5 > 1 and < 5 0

Tier 2 Unplanned Mental Health readmission within 28 days (%)

13 < 20% > 13% and < 20%

< 13

Tier 2

Mental Health Acute Post-Discharge Community Care - follow up within seven days (%)

70 < 50% > 50% and < 70%

> 70%

Tier 2 Mental health ambulatory contacts (number ‘000) 125,125 > 10% less

than target < 10% under

target Target met

or better

Finance and Management

Tier 1 Cost weighted separations – Year to Date

140,377 > 2% less than or above

target

< 2% under or above

target

Target met

Tier 1

Expenditure matched to budget (General Fund): Year to Date; June projection

a) Year to date - General Fund (%) +/- 0.5 > 2.0% Unfavourable

> 0.5% but < 2.0%

Unfavourable

Favourable

or < 0.5% Unfavourable

b) June projection - General Fund (%)

0 > 1.0% Unfavourable

< 1.0% Unfavourable

On budget or Favourable

Finance and Management Revenue Matched to budget (General Fund): Year to Date; June projection

a) Year to date - General Fund (%) +/- 0.5 > 2.0%

Unfavourable > 0.5% but < 2.0%

Unfavourable Favourable

or < 0.5% Unfavourable

b) June projection - General Fund (%) 0 > 1.0% Unfavourable

< 1.0% Unfavourable

On budget or Favourable

Recurrent Trade Creditors > 45 days as a percentage of rolling prior 12 months G&S Expenditure (excluding VMO's) (%)

< 1 > 1% n.a. < 1%

Finance and Management Coding timeliness -Separations coded six week post discharge (%)

95 < 85% > 85% and < 95% > 95%

Population Health

Tier 2

Connecting Care : Enrolled patients (number) 1,646 > 20% under target

< 20% under target

Target met

or better

Tier 1: Areas of Risk Off Stretcher Time

Triage 3

Emergency Admission Performance

Strategies: Trial ambulance release teams

Enhanced escalation processes

Commencement of new Offload data collection system

Trial new ambulatory care models at RPAH, Concord and Canterbury as an alternative to ED

Strengthening the MAU

Inpatient co-ordinate care i.e. Fast Track

Tier 2: Areas of Risk

Central Line Associated Bloodstream (CLAB) Infections (number)

Mental Health Access- inpatient and community

Strategies: CLAB infections

Strategies implemented to reduce reoccurrence

Review of appropriate use of antibiotics with Infectious Diseases approval.

Strict adherence to Hand Hygiene and conduct regular hand hygiene audits

Further focus on ensuring the removal of infected Central Venous Catheters occurs according to guidelines

Further focus on ensuring that the insertion and maintenance of CVC occur according to guidelines (completing checklist and data collection form)

Strategies: CLAB infections

Daily review of line necessity

Maintaining competency packages for medical and nursing staff.

All CLABs will now be presented and reviewed at the District Infection Control Meeting to assist with peer learning

Environmental control strategies other than cleaning in other areas e.g. burns unit engineering action (minor modifications to drains, waste traps, showerheads, etc) in addition to additional cleaning

Strategies: CLAB infections

Models of care review in relation to management of central lines

Options for response to tourniquet study findings

Antibiotic stewardship

Plan for improved awareness of infection control procedures for non-ICU staff who enter the ICU.

Centralisation of PICC and CVAD insertion so there is a consistent and standardised process and environment for the insertion of these devices.

Strategies: Mental Health

Enhance community teams to improve follow-up and management out of hospital

Investigate alternate models of care

SLHD 2011/12 BUDGET ALLOCATION

Conditions of funding

comply with the provisions of the relevant Accounting Manual and the Accounts and Audit Determination for Public Health Organisations.

ensure compliance with specific conditions attached to funding.

correctly differentiate between General Fund and Special Purpose and Trust Funds.

operate within approved Net Cost of Services for both General Fund and Special Purpose and Trust Funds.

achieve approved Efficiency, Revenue and Turnaround Plans.

pay creditors within benchmark.

report on financial performance on a monthly basis through SMRT with accompanying narrative and submit financial reports and narratives by the 10th calendar day

Determination of LHD Budget allocations 2011/12 LHD budget allocations have been developed based on the

following key components:

– Annualised 2010/11 base budget including the 2010/11 COAG funded beds

– Escalation for background cost increases- approved award increases, increase nursing hours/patient and general CPI

– Additional funding for new services, specific election commitments and state priorities

Growth agreed between NSW Min of Health and LHD at hospital level for acute inpatients and/or ED activity funded at the marginal rate of 50% of the nominal price

Funding Recall strategy

Activity above the target - no additional funding will be provided

Activity below target- Ministry will recall funded (unless agreed as a change of model of care) based on marginal rates of the nominal price- LHD receiving recall advice will be requested to submit to the Ministry, explanation for the reduction in activity and a proposal to make up the activity shortfall. If such a proposal is agreed then recall will not be activated at that time.

LHD are to determine their own strategy for managing over and under target activity of individual hospitals with the overall activity targets.

2011/12 Expense, Revenue and Net Cost of Service Initial budget by fund type and cost line item

Net Cost of Service – Budget Allocation Account Class by Fund

Expenditure Issues

Whilst the budget suggests an increase of $44.292 m, many of the items esp. additional beds are not new as expenditure has already been incurred in 2010/11 and are now annualised in 2011/12 ($14.3m)

High Cost drugs $3.08m is offset with revenue $3.08m

The net CPI increase is $2.9m)

Net nurses aware allocations is $8.89m ($9.34m-0.449m)

Expenditure Issues:

Total new enhancement is approx. $12.377m

– ED strategy $0.285m

– Nursing hours $5.017m

– Nurses $0.208m

– LHD governance $0.169m

– General growth $6.698m

Revenue Issues

Enhancement increase of $0.964m

HCD rev. $3.083m will offset increase in exp. of $3.083m

HACC rev of $10.324m represent funding will come to SLHD via revenue income instead of Health subsidy- little impact unless Commonwealth reduces funding

Summary

The budget will be tight again in 2011/12

Budgets are currently being allocated to Facilities based on the historical budget plus escalation. SMRT- ABF system is being implemented to facilitate reporting of activity and expenditure

Activity targets are being allocated to facilities for acute, ED, ICU and Sub-acute care episodes

Risks

Not meeting the activity targets and having budget recall. Action: regular feedback to facilities and clinicians, implementation of ABF initiatives

Uncertainty associated with HACC funding into the future- HACC funding ($10.3 m now transferred from subsidy to revenue)- impact on Staff FTE expenditure- LHD has to manage excess staff if funding is reduced- Action: Balmain budget to be reviewed

Nursing hours provision ($5m) dependent on recruitment of positions to designated wards- Action: staffing levels will be monitored and funds will not be allocated to facilities until staff appointed

Risks

Management of staff expectations- COAG beds established in 2010/11 annualised in 2011/12. no new funds. Acton: regular feedback/ communication with clinicians and managers.

Meeting the increased revenue target. Action: LHD will need to drive revenue initiatives further, increased monitoring and feedback to facilities and clinicians

Growth of $6.698M less than 0.5% of total budget. Action: Growth funding will not be allocated in first 6 months.

1.5% efficiency and revenue target to be achieved. Action: implementation of the efficiency and revenue plan, regular monitoring of performance against targets.

Financial management strategies

Good cash management is about:

Knowing our budget

Knowing our commitments

Knowing our targets

Ensuring we have a clear plan for effectively managing our business

Recognising that we can’t spend more than we have in cash

Financial Management

Good cash management is about:

Recognising our responsibilities to our creditors

Having appropriate controls in place for expenditure

Frequent ongoing monitoring of expenditure against target

Managing staffing

The biggest driver of expenditure is salaries and wages

(around 65%), so we need to manage this by:

Establishing, disseminating and monitoring staffing targets

Ensuring effective controls are in place for all aspects of staffing – Recruitment (including walk-ins) – Overtime – Use of casuals – Use of agency staff – Extension of hours of part time staff

Managing staffing Ensuring effective governance including delegations, regular

meetings

– All recruitment (permanent/temporary) requires GM and CE/DOO approval

– Regular meetings with the CE/DOO to review performance against targets

– Individual

– Facility Executive

– Area Manager’s Meeting

– Clinical Stream meetings

Ensuring reliable data/reporting is provided to drive performance

Recruitment Controls

All recruitment requests (including re-advertising): – are reviewed centrally following local and facility management

review – Nursing recruitment is reviewed with the Area Director of

Nursing – Medical recruitment is reviewed with the Area Director of

Medical Administration – have to be justified including a review of:

– the need for the position, – staffing mix and – model of care

– are considered in light of facility and cost centre performance against staffing targets

– are prioritised according to clinical and operational need

Recruitment Controls Temporary Appointments

– reviewed centrally following local and facility management review, – reviewed against cost centre performance and staffing target

Casuals – approved centrally by DOO following review by GMs – approved at a facility executive level prior to allocations

Agency – approved at a facility executive level

Overtime – All nursing and corporate overtime requires facility executive

approval (except JMO) – All JMO overtime reviewed by DMSs (monitored by Area Exec)

Reports Fortnightly and Monthly reports provided to facilities including: Detailed Fortnightly Staff Profile

– FTE Staffing against target/ previous year performance • By cost centre • By staffing classification

– Overtime – Agency – Casuals – Commencements/cessations

Extended contract hours VMO hours/salaries

Communication

Periodic prompts to focus attention on areas of concern e.g. memos to GMs re: exceeded contract hours, monitoring of overtime performance, use of casuals etc

Phone calls following receipt of monthly Staff Profile to highlight areas requiring analysis prior meeting with CE.

Reflection of LHD practices at a facility level

Promotion of healthy competition between directorates to enhance performance

Other strategies to manage staffing

Reducing activity during holiday periods to refresh staff and reduce annual leave liability

Actively managing sick leave

Recruiting casual staff instead of using overtime or agency staff

Reducing the use of locum medical staff

Restructuring services to gain staffing efficiencies (aged care, community health, youth health, JMOs)

New models of care