Australian Government shies away from election promise to takeover control of hospitals

Kevin Rudd's Government appears to be backing out of another of its election promises - the financial takeover of public hospitals if they fail to come up to scratch.

According to Health Minister, Nicola Roxon, despite the continuation of long waiting lists and hospital strains, there are "positive signs" of improvement in public hospitals and "significant developments".

Ms Roxon says state governments had agreed to sign on to "improved outcomes" and it is suspected that the Government will abandon moves to take over hospitals which are performing poorly and will instead try to control other health areas such as outpatient care and community health services.

It is thought that the National Health and Hospitals Reform Commission will shy away from a total federal takeover and instead recommend in its final report next month that the Commonwealth assume financial control over outpatient care and all health services outside of hospitals - in this way improved co-ordination of primary health care by doctors, nurses and community services could apparently be achieved.

The commission's interim report suggests that this plan while it would involve a significant shift in responsibility to the Commonwealth, would ultimately mean less disruption to existing responsibilities than other more radical alternatives.

The report says the Commonwealth could have more influence over in-hospital care by introducing a payment system tied more closely to actual caseload, rather than untargeted payments.

Ms Roxon says while there have been significant developments since Labor took office "not everything is fixed" - but the Opposition's has accused the Rudd Government of reneging again on an election promise to end the "blame game" over funding between federal and state governments - in 2007 Labor had promised to take over the nation's 750 public hospitals if they do not lift their game by mid-2009 - that threat was linked to $2 billion in federal funding and it is now 18 months since the last Federal election.

Ms Roxon says the Government is waiting for a final report from the Health and Hospitals Reform Commission next month.