Victorian Government confirms regional hospital funding, with forced mergers off the table

The opposition, however, fear the plans could lead to what it describes as ‘amalgamation by stealth’.

Premier Jacinta Allan said the government had made record investment in Victoria’s hospitals.

“That includes recruiting a record number of doctors and nurses, record funding for our hospitals and health infrastructure — and of course, our record pay deal for Victorian nurses,” Ms Allan said.

“Today, we’re continuing to build on that record.

“As the sister of a nurse, and the mum of a daughter who has relied on the life-saving care of our hospitals, my priority will always be patients and their families.

“We will always support our hospitals — because that’s what Labor does.

“The government will invest a further $1.5 billion to support hospitals to deliver world-class care, building on the more than $8.8 billion we invested in the budget.

“This investment delivers the funding hospitals told us they needed, while also enabling Victoria to continue delivering a record number of elective surgeries.

“The government has also accepted in full or accepted in principle 26 of 27 recommendations proposed by the Expert Advisory Committee, as part of its Health Services Plan.

“These are recommendations that we know will make our health system stronger and more connected — while continuing our focus on patients and frontline care.”

The government promised to deliver a number of key reforms in response to these recommendations.

“It will not, however, accept the recommendation to forcibly amalgamate Victoria’s health services,” Ms Allan said.

“We believe that locals know their community’s health needs best and — together with their health service leaders — their voices must be listened to in the delivery of local healthcare.

“Forcing change risks being disruptive, impacting patient care.”

Instead, health services will be supported to reduce non-clinical duplication and double-up, while at the same time promoting stronger partnerships between hospitals.

Ms Allan said this achieved the report’s ambition of a more integrated and efficient health system, without disrupting local services.

State Member for Northern Victoria Wendy Lovell welcomed the news, while describing it as a backflip, and credited people-power with the outcome.

“Premier Jacinta Allan is now running scared from bad polls and strong community backlash to her destructive policies,” Ms Lovell said.

“The planned amalgamations were always poor policy, sacrificing patient accessibility to chase short-term savings because Labor can’t manage money and their decade of financial mismanagement has left Victoria in billions of dollars of debt.

“Local communities, health workers and hospital administrators saw the flaws in the amalgamation plan from the beginning, and worked tirelessly to raise awareness and organise community action, showing the Labor government that local people care about their local health services.

“I thank the thousands of Victorians who attended public rallies, wrote to members of parliament, and signed petitions to tell Labor that local health services should be kept in local hands and independently run.

“However, local communities must remain vigilant that Labor’s announced five regional health ‘networks’ are not a stepping stone to amalgamation by stealth.

“Labor has spent years developing their secret health services plan and in the interests of transparency, Premier Jacinta Allan must immediately release it in full.”

The details

Local Health Service Networks

Ms Allan said in line with one of the report’s key recommendations, the government would replace Health Service Partnerships with stronger Local Health Service Networks.

She said bringing together hospitals within a geographical region, these networks will support hospitals to collaborate — enabling them to work together to deliver better care, while also better supporting staff across each region.

Each network will establish a formal relationship with a major tertiary, a women’s and a children’s hospital.

Ms Allan his would mean patients could more easily and quickly access specialist care when they needed it, strengthening referral pathways and enabling the sharing of expertise across specialities.

Once established, the networks will share functions such as payroll and IT.

Hospitals Victoria

The government will establish Hospitals Victoria — a new agency in the Department of Health, with a chief executive who reports directly to the health ministers — that is fully focused on supporting hospitals to deliver frontline care.

It will also help hospitals collaborate.

Right now, hospitals have different payroll and IT systems. As part of its remit, Hospitals Victoria will work with hospitals to identify back-office functions that can be consolidated and streamlined.

The government will continue its existing work to improve digital systems and technology, including how virtual care can be better used, in line with the report’s recommendations.

The new agency will also support the operation of our hospitals and their finances.

Hospitals Victoria will be led by Siva Sivarajah, who has extensive experience running hospitals and improving the delivery of care.

Electronic Medical Record System

“We will also roll out a connected Electronic Medical Record System to all hospitals, which will provide seamless and more efficient care for patients,” Ms Allan said.

“Currently, our health services use different patient record systems — some of them paper based. It’s outdated, it’s inefficient and it often causes needless stress for patients and their families.

“It’s why Hospitals Victoria and the department will work with health services to deliver a connected and standardised electronic record management system for Victoria’s hospitals.

“Not only will it reduce delays and duplication, it’ll mean a patient’s records move with them — regardless of the hospital they’re being treated at.”

Protecting frontline services

“We’ve always given our hospitals what they needed — we did this before the pandemic, throughout the pandemic and we’ll continue this now,” Ms Allan said.

“During COVID, hospitals essentially operated without an agreed budget — because saving lives meant providing our hospitals with everything they needed to tackle the virus.

“Now’s the time to return to something a bit more normal — allowing hospitals to plan ahead.

“It’s why we’ve proactively worked with hospitals to develop budgets and why we will invest an additional $1.5 billion into our hospitals.

“This funding will enable our hospitals to continue delivering world-class care despite record demand, with more than half a million emergency department presentations last quarter alone — making it the busiest quarter on record.

“It will also support a further 10,000 surgeries — bringing our total target for elective surgery for this financial year to 210,000 — matching the almost 210,000 surgeries performed in 2023-24, the highest figure on record.

“This is the funding our hospitals told us they needed, and this is what we’ve delivered — because Labor will always be on the side of our hospitals.”