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Ministerial Direction

On 29 August 2016 IHPA received a Ministerial Direction from the Hon. Sussan Ley, under section 226 of the National Health Reform Act 2011.

The Direction requires the Independent Hospital Pricing Authority (IHPA) to provide advice to the Commonwealth and states and territories on options for developing:

  • a comprehensive and risk-adjusted model to determine how funding and pricing can be used to improve patient outcomes and reduce the amount the Commonwealth pays for sentinel events, and a set of preventable hospital acquired conditions, defined by the Australian Commission on Safety and Quality in Health Care and agreed by the Parties, that occur in public hospitals; and
  • a comprehensive and risk-adjusted strategy and funding model to reduce avoidable readmissions to hospital that will adjust the funding to hospitals that exceed a predetermined avoidable readmission rate for an agreed set of conditions and the circumstances in which they occur.

IHPA must provide advice to the COAG Health Council regarding options by 30 November 2016.

IHPA will undertake a consultation process regarding options for pricing and funding for safety and quality as part of its annual consultation process on the draft Pricing Framework for Australian Public Hospitals due for publication 30 September 2016. The consultation paper will be published on IHPA’s website.

All interested parties are encouraged to provide feedback as part of this process.

More information

For any questions, please contact enquiries.ihpa [at]