Victorian hospitals’ funding plea amid service cut fears

Victoria’s public hospitals have issued an urgent funding plea, warning cash reserves have hit record lows amid a “budget crisis in the health system”.

Hospital cash reserves have hit record lows. Picture: iStock

Hospital cash reserves have hit record lows, their peak body says, forcing some to pull funds from vital supports to cover crucial safety programs and sparking warnings of service cuts.

The Victorian Healthcare Association – which represents public hospital and health services – has called for more funding in the upcoming state budget, with chief executive Leigh Clarke revealing any more cuts would have “significant consequences for delivery of care.”

The body has said the patient demand-based funding hospitals receive does not fully cover crucial safety and welfare initiatives – including de-escalation training, CCTV and last measure resorts like security guards – with unfunded costs like these contributing to services’ budgets “structural deficits”.

They have called for more funds to keep staff safe.

The Victorian Healthcare Association wants more funding in the upcoming state budget. Picture: iStock

Ms Clarke said: “until we address the structural deficit more essential services may continue to go unfunded, which will only add further to the budget crisis facing our health system”.

The Herald Sun understands one small, regional health service – running a deficit of about $100,000 – had to turn to community fundraising to pay for CCTV, while several major Melbourne hospitals have cut funds from other areas to employ security guards.

Some health services, spending into deficit, are reliant on government ‘top-ups’ to keep services running while several have made “difficult decisions” to leave essential back of house roles unfilled – including finance, administration and other support roles important to quality patient care – to cover key wellbeing measures.

The funding plea comes after the VHA raised concerns about WorkCover premiums’ sharp rise and the government asked health services to “find savings across non-clinical staff and services”.

Some health services, spending into deficit, are reliant on government ‘top-ups’ to keep services running. Picture: iStock

There have been concerns that – unless funding issues are resolved – there will be staffing cuts, as hospitals reallocate what funds they can into welfare programs amid warnings the current occupational violence rate cannot continue.

The Herald Sun revealed in November that Melbourne hospital workers were physically and verbally attacked at a rate of more than once an hour last financial year.

Ms Clarke said “many” health services’ cash reserves – often used to fund safety programs – were at reported lows, creating a “significant risk” for the sector’s “ongoing viability”.

“There are longstanding issues within Victoria’s public health system that need to be addressed to support workforce wellbeing,” she said.

“The reality is there is no money to invest in critical areas like health and wellbeing, requiring health services to pull funds from outside sources to meet this pressing need.

“Extra [pandemic] funding has dried up, even though the true cost of delivering health care is increasing.”

Victorian Healthcare Association chief executive Leigh Clarke says any more cuts would have ‘significant consequences for delivery of care’. Picture: iStock

She warned savings found now would just cost more later, with escalating WorkCover premiums – at risk “of another rise” – making it difficult to invest money in the very programs that kept an “already fatigued” workforce well.

“The problems associated with the WorkCover scheme will not be solved overnight, but a continued lack of government investment in health and wellbeing doesn’t make any sense,” she said.

“Not only does this fail to build the capacity of an already fatigued workforce, but it’s also placing upward pressure on WorkCover premiums.

“The VHA urge the Victorian government to adequately fund all health services in this year’s State Budget to keep their employees healthy and safe at work.”

A Victorian Government spokeswoman said they “regularly engage with health services on finances because Victorians rightly expect that hospitals focus their spending on critical frontline services” – with $47 million spent on occupational violence training and staff wellbeing initiatives since 2015.

“We have increased funding to our hospitals in every single budget we have handed down – delivering record funding to our public health system,” she said.

“Everyone has the right to feel safe at work – we have zero tolerance to any violence, harassment or bullying towards our health service workforce.”