WACHS Annual Report 2018-19: Disclosure & Compliance

Audit Opinion

Auditor General

INDEPENDENT AUDITOR'S REPORT

To the Parliament of Western Australia

WA COUNTRY HEAL TH SERVICE

Report on the Financial Statements

Opinion
I have audited the financial statements of the WA Country Health Service which comprise the Statement of Financial Position as at 30 June 2019, the Statement of Comprehensive Income, Statement of Changes in Equity, Statement of Cash Flows for the year then ended, and Notes comprising a summary of significant accounting policies and other explanatory information.

In my opinion, the financial statements are based on proper accounts and present fairly, in all material respects, the operating results and cash flows of the WA Country Health Service for the year ended 30 June 2019 and the financial position at the end of that period. They are in accordance with Australian Accounting Standards, the Financial Management Act 2006 and the Treasurer's Instructions.

Basis for Opinion
I conducted my audit in accordance with the Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Health Service in accordance with the Auditor General Act 2006 and the relevant ethical requirements of the Accounting Professional and Ethical Standards Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to my audit of the financial statements. I have also fulfilled my other ethical responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Responsibility of the Board for the Financial Statements
The Board is responsible for keeping proper accounts, and the preparation and fair presentation of the financial statements in accordance with Australian Accounting Standards, the Financial Management Act 2006 and the Treasurer's Instructions, and for such internal control as the Board determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Board is responsible for assessing the agency's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Western Australian Government has made policy or funding decisions affecting the continued existence of the Health Service.

Auditor's Responsibility for the Audit of the Financial Statements
As required by the Auditor General Act 2006, my responsibility is to express an opinion on the financial statements. The objectives of my audit are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with Australian Auditing Standards, I exercise professional judgment and maintain professional scepticism throughout the audit. I also:

  • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
  • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the agency's internal control.
  • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board.
  • Conclude on the appropriateness of the Board's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the agency's ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor's report.
  • Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

I communicate with the Board regarding, among other matters, the planned scope and tiniing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

Report on Controls

Opinion
I have undertaken a reasonable assurance engagement on the design and implementation of controls exercised by the WA Country Health Service. The controls exercised by the Health Service are those policies and procedures established by the Board to ensure that the receipt, expenditure and investment of money, the acquisition and disposal of property, and the incurring of liabilities have been in accordance with legislative provisions (the overall control objectives).

My opinion has been formed on the basis of the matters outlined in this report.

In my opinion, in all material respects, the controls exercised by the WA Country Health Service are sufficiently adequate to provide reasonable assurance that the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities have been in accordance with legislative provisions during the year ended 30 June 2019.

The Board's Responsibilities
The Board is responsible for designing, implementing and maintaining controls to ensure that the receipt, expenditure and investment of money, the acquisition and disposal of property, and the incurring of liabilities are in accordance with the Financial Management Act 2006, the Treasurer's Instructions and other relevant written law.

Auditor General's Responsibilities
As required by the Auditor General Act 2006, my responsibility as an assurance practitioner is to express an opinion on the suitability of the design of the controls to achieve the overall control objectives and the implementation of the controls as designed. I conducted my engagement in accordance with Standard on Assurance Engagements ASAE 3150 Assurance Engagements on Controls issued by the Australian Auditing and Assurance Standards Board. That standard requires that I comply with relevant ethical requirements and plan and perform my procedures to obtain reasonable assurance about whether, in all material respects, the controls are suitably designed to achieve the overall control objectives and the controls, necessary to achieve the overall control objectives, were implemented as designed.

An assurance engagement to report on the design and implementation of controls involves performing procedures to obtain evidence about the suitability of the design of controls to achieve the overall control objectives and the implementation of those controls. The procedures selected depend on my judgement, including the assessment of the risks that controls are not suitably designed or implemented as designed. My procedures included testing the implementation of those controls that I consider necessary to achieve the overall control objectives.

I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Limitations of Controls
Because of the inherent limitations of any internal control structure it is possible that, even if the controls are suitably designed and implemented as designed, once the controls are in operation, the overall control objectives may not be achieved so that fraud, error, or noncompliance with laws and regulations may occur and not be detected. Any projection of the outcome of the evaluation of the suitability of the design of controls to future periods is subject to the risk that the controls may become unsuitable because of changes in conditions.

Report on the Key Performance Indicators

Opinion
I have undertaken a reasonable assurance engagement on the key performance indicators of the WA Country Health Service for the year ended 30 June 2019. The key performance indicators are the key effectiveness indicators and the key efficiency indicators that provide performance information about achieving outcomes and delivering services.

In my opinion, in all material respects, the key performance indicators of the WA Country Health Service are relevant and appropriate to assist users to assess the Health Service's performance and fairly represent indicated performance for the year ended 30 June 2019.

Matter of Significance
The Under Treasurer has continued his approval to remove the following indicator as a key performance indicator (KPI):

  • Percentage of emergency department patients seen within recommended times.

The approval was conditional on its inclusion as an unaudited performance indicator in the Annual Report and that it be re-instated as KPI once a new emergency department data collection system has been implemented. There is currently no set timeframe for the implementation of a new system. My opinion is not modified in respect of this matter.

The Board's Responsibility for the Key Performance Indicators
The Board is responsible for the preparation and fair presentation of the key performance indicators in accordance with the Financial Management Act 2006 and the Treasurer's Instructions and for such internal control as the Board determines necessary to enable the preparation of key performance indicators that are free from material misstatement, whether due to fraud or error.

In preparing the key performance indicators, the Board is responsible for identifying key performance indicators that are relevant and appropriate having regard to their purpose in accordance with Treasurer's Instruction 904 Key Performance Indicators.

Auditor General's Responsibility
As required by the Auditor General Act 2006, my responsibility as an assurance practitioner is to express an opinion on the key performance indicators. The objectives of my engagement are to obtain reasonable assurance about whether the key performance indicators are relevant and appropriate to assist users to assess the agency's performance and whether the key performance indicators are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. I conducted my engagement in accordance with Standard on Assurance Engagements ASAE 3000 Assurance Engagements Other than Audits or Reviews of Historical Financial Information issued by the Australian Auditing and Assurance Standards Board. That standard requires that I comply with relevant ethical requirements relating to assurance engagements.

An assurance engagement involves performing procedures to obtain evidence about the amounts and disclosures in the key performance indicators. It also involves evaluating the relevance and appropriateness of the key performance indicators against the criteria and guidance in Treasurer's Instruction 904 for measuring the extent of outcome achievement and the efficiency of service delivery. The procedures selected depend on my judgement, including the assessment of the risks of material misstatement of the key performance indicators. In making these risk assessments I obtain an understanding of internal control relevant to the engagement in order to design procedures that are appropriate in the circumstances.

I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

My Independence and Quality Control Relating to the Reports on Controls and Key Performance Indicators
I have complied with the independence requirements of the Auditor General Act 2006 and the relevant ethical requirements relating to assurance engagements. In accordance with ASQC 1 Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other Assurance Engagements, the Office of the Auditor General maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Matters Relating to the Electronic Publication of the Audited Financial Statements and Key Performance Indicators
This auditor's report relates to the financial statements and key performance indicators of the WA Country Health Service for the year ended 30 June 2019 included on the Health Service's website. The Health Service's management is responsible for the integrity of the Health Service's website. This audit does not provide assurance on the integrity of the Health Service's website. The auditor's report refers only to the financial statements and key performance indicators described above. It does not provide an opinion on any other information which may have been hyperlinked to/from these financial statements or key performance indicators. If users of the financial statements and key performance indicators are concerned with the inherent risks arising from publication on a website, they are advised to refer to the hard copy of the audited financial statements and key performance indicators to confirm the information contained in this website version of the financial statements and key performance indicators.

[Image: Caroline Spencer signature (PDF only)]

CAROLINE SPENCER
AUDITOR GENERAL
FOR WESTERN AUSTRALIA
Perth, Western Australia
 12 September 2019

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Certification of financial statements

WA COUNTRY HEALTH SERVICE CERTIFICATION OF FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018

The accompanying financial statements of the WA Country Health Service have been prepared in compliance with the provisions of the Financial Management Act 2006 from proper accounts and records to represent fairly the financial transactions for the financial year ending 30 June 2019 and financial position as at 30 June 2019.

At the date of signing we are not aware of any circumstance which would render the particulars included in the financial statements misleading or inaccurate.

[Mr John Arkell signature (PDF only)]
Mr John Arkell
Chief Finance Officer
WA Country Health Service
11 September 2019

[Professor Neale Fong signature (PDF only)]
Professor Neale Fong
Chair
WA Country Health Service Board
11 September 2019

[Mr Alan Ferris signature (PDF only)]
Mr Alan Ferris
Board Member
WA Country Health Service Board
11 September 2019

Financial statements

Statement of Comprehensive Income

For the year ended 30 June 2019

 Note2019
$000
2018
$000
COST OF SERVICES
Expenses
Employee benefits expense
3.1 1,056,963 1,002,713
Fees for visiting medical practitioners 3.2 93,354 85,859
Patient support costs 3.2 390,826 381,124
Finance costs 7.2 88 138
Depreciation and amortisation expense 5.1, 5.2 81,089 74,005
Asset revaluation decrement 5.1 21,661 17,566
Loss on disposal of non-current assets 5.1 371 3,406
Repairs, maintenance and consumable equipment 3.3 46,216 49,200
Other expenses 3.3 175,615 165,559
Total cost of services   1,866,183 1,779,570
INCOME
Revenue
Patient charges 4.4 64,914 67,187
Commonwealth grants and contributions 4.2 517,430 484,181
Other grants and contributions 4.3 99,934 95,652
Donation revenue   495 551
Other revenue 4.5 20,756 22,589
Total revenue   703,529 670,160
Total income other than income from State Government   703,529 670,160
NET COST OF SERVICES   1,162,654 1,109,410
INCOME FROM STATE GOVERNMENT
Service appropriations 4.1 965,822 948,805
Assets assumed 4.1 (64) (67)
Services received free of charge 4.1 55,286 55,373
Royalties for Regions Fund 4.1 96,970 71,723
Total income from State Government   1,118,014 1,075,834
DEFICIT FOR THE PERIOD   (44,640) (33,576)
OTHER COMPREHENSIVE INCOME/(LOSS)
Items not reclassified subsequently to profit or loss
Changes in asset revaluation reserve   - -
Gains/(losses) recognised directly in equity   - -
Total other comprehensive income   - -
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE PERIOD   (44,640) (33,576)

Refer also to note 2.2 'Schedule of Income and Expenses by Service'.
The Statement of Comprehensive Income should be read in conjunction with the accompanying notes.

Statement of Financial Position

As at 30 June 2018

 Note2019
$000
2018
$000
ASSETS
Current assets
Cash and cash equivalents 7.3 20,434 18,173
Restricted cash and cash equivalents 7.3 25,751 25,342
Receivables 6.1 20,469 23,647
Other assets 6.3 9,447 9,485
Total Current Assets   76,101 76,647
Non-Current Assets
Restricted cash and cash equivalents 7.3 7,463 7,463
Amounts receivable for services 6.2 832,856 748,497
Property, plant and equipment 5.1 1,884,776 1,916,214
Intangible assets 5.2 18,842 17,338
Total Non-Current Assets   2,743,937 2,689,512
Total Assets   2,820,038 2,766,159
LIABILITIES
Current Liabilities
Payables 6.4 118,055 116,019
Borrowings 7.1 1,865 1,779
Provisions 3.1 154,151 143,401
Other liabilities   363 52
Total Current Liabilities   274,434 261,251
Non-Current Liabilities
Borrowings 7.1 - 1,865
Provisions 3.1 30,147 27,885
Total Non-Current Liabilities   30,147 29,750
Total Liabilities   304,581 291,001
NET ASSETS   2,515,457 2,475,158
EQUITY
Contributed equity 9.10 2,629,022 2,541,924
Reserves   - -
Accumulated deficit   (113,565) (66,766)
TOTAL EQUITY   2,515,457 2,475,158

The Statement of Financial Position should be read in conjunction with the accompanying notes.

Statement of Changes in Equity

For the year ended 30 June 2019

 Note2019
$000
2018
$000
CONTRIBUTED EQUITY 9.10    
Balance at start of period   2,541,924 2,310,640
Transactions with owners in their capacity as owners:      
Capital appropriations   16,282 27,781
Royalties for Regions Fund   70,691 206,831
Other contributions by owners   125 695
Distributions to owners   - (4,023)
Balance at end of period   2,629,022 2,541,924
RESERVES
Asset Revaluation Reserve
Balance at start of period   - -
Comprehensive income/(loss) for the period   - -
Balance at end of period      
ACCUMULATED SURPLUS/(DEFICIT)
Balance at start of period   (66,766) (33,190)
Initial application of Australian Accounting Standards   (2,159) -
Restated balance at start of period   (68,925) (33,190)
Deficit for the period   (44,640) (33,576)
Balance at end of period   (113,565) (66,766)
TOTAL EQUITY
Balance at start of period   2,475,158 2,277,450
Initial application of Australian Accounting Standards   (2,159) -
Restated balance at start of period   2,472,999 2,277,450
Total comprehensive income/(loss) for the period   (44,640) (33,576)
Transactions with owners in their capacity as owners   87,098 231,284
Balance at end of period   2,515,457 2,475,158

The Statement of Changes in Equity should be read in conjunction with the accompanying notes.

Statement of Cash Flows

For the year ended 30 June 2019

 Note2019
$000
Inflows
(Outflows)
2018
$000
Inflows
(Outflows)
CASH FLOWS FROM STATE GOVERNMENT
Service appropriations   881,370 874,584
Capital appropriations   14,503 26,080
Royalties for Regions Fund   167,661 278,554
Net cash provided by State Government   1,063,534 1,179,218
Utilised as follows:
CASH FLOWS FROM OPERATING ACTIVITIES
Payments
Employee benefits   (1,041,413) (997,236)
Supplies and services   (626,995) (604,092)
Receipts
Receipts from customers   63,126 64,412
Commonwealth grants and contributions   517,430 484,181
Other grants and contributions   99,934 95,653
Donations received   495 521
Other receipts   19,612 26,532
Net cash used in operating activities 7.3 (967,811) (930,029)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments
Purchase of non-current physical assets   (93,053) (258,369)
Net cash used in investing activities   (93,053) (258,369)
Net increase / (decrease) in cash and cash equivalents   2,670 (9,180)
Cash and cash equivalents at the beginning of the period   50,978 60,158
Cash and cash equivalents transferred in from abolished entity   - -
CASH AND CASH EQUIVALENTS AT THE END OF PERIOD 7.3 53,648 50,978

The Statement of Cash Flows should be read in conjunction with the accompanying notes.

Notes to the Financial Statements

For the year ended 30 June 2019

Note 1: Basis of preparation

WA Country Health Service is a WA Government entity and is controlled by the State of Western Australia, which is the ultimate parent. It is a not-for-profit entity (as profit is not its principal objective).

A description of the nature of its operations and its principal activities have been included in the 'Overview' which does not form part of these financial statements.

Statement of compliance

These general purpose financial statements are prepared in accordance with:

  1. The Financial Management Act 2006
  2. The Treasurer's Instructions
  3. Australian Accounting Standards including applicable interpretations
  4. Where appropriate, those Australian Accounting Standards paragraphs applicable for not-for-profit entities have been applied.

The Financial Management Act 2006 and the Treasurerʼs Instructions take precedence over the Australian Accounting Standards. Several Australian Accounting Standards are modified by the Treasurer's Instructions to vary application, disclosure format and wording. Where modification is required and has had a material or significant financial effect upon the reported results, details of that modification and the resulting financial effect are disclosed in the notes to the financial statements.

Basis of preparation

These financial statements are presented in Australian dollars applying the accrual basis of accounting and using the historical cost convention. Certain balances will apply a different measurement basis (such as the fair value basis). Where this is the case the different measurement basis is disclosed in the associated note. All values are rounded to the nearest thousand dollars ($ʼ000).

Judgements and estimates

Judgements, estimates and assumptions are required to be made about financial information being presented. The significant judgements and estimates made in the preparation of these financial statements are disclosed in the notes where amounts affected by those judgements and/or estimates are disclosed. Estimates and associated assumptions are based on professional judgements derived from historical experience and various other factors that are believed to be reasonable under the circumstances.

Contributed equity

AASB Interpretation 1038 Contributions by Owners Made to Wholly-Owned Public Sector Entities requires transfers in the nature of equity contributions, other than as a result of a restructure of administrative arrangements, to be designated by the Government (the owner) as contributions by owners (at the time of, or prior to, transfer) before such transfers can be recognised as equity contributions. Capital appropriations have been designated as contributions by owners by TI 955 Contributions by Owners made to Wholly Owned Public Sector Entities and have been credited directly to Contributed Equity.

The transfers of net assets to/from other agencies, other than as a result of a restructure of administrative arrangements, are designated as contributions by owners where the transfers are non-discretionary and non-reciprocal.

Note 2: WA Country Health Service outputs

How WA Country Health Service operates

This section includes information regarding the nature of funding the WA Country Health Service receives and how this funding is utilised to achieve its objectives.

  • WA Country Health Service objectives - Note 2.1
  • Schedule of Income and Expenses by Service - Note 2.2

2.1 WA Country Health Service objectives

Mission

WA Country Health Serviceʼs purpose is to improve country peopleʼs health and wellbeing through access to quality services and by supporting people to look after their own health.

Services

The key services of WA Country Health Service are:

1. Public Hospital Admitted Services
The provision of healthcare services to patients in major rural hospitals that meet the criteria for admission and receive treatment and/or care for a period of time, including public patients treated in private facilities under contract to WA Health. Admission to hospital and the treatment provided may include access to acute and/or subacute inpatient services, as well as hospital in the home services. Public Hospital Admitted Services includes teaching, training and research activities provided by the public health service to facilitate development of skills and acquisition or advancement of knowledge related to admitted services. This Service does not include any component of the Mental Health Services reported under Service four “Mental Health Services”.

2. Public Hospital Emergency Services
The provision of services for the treatment of patients in emergency departments of major rural hospitals, inclusive of public patients treated in private facilities under contract to WA Health. The services provided to patients are specifically designed to provide emergency care, including a range of pre-admission, post-acute and other specialist medical, allied health, nursing and ancillary services. Public Hospital Emergency Services includes teaching, training and research activities provided by the public health service to facilitate development of skills and acquisition or advancement of knowledge related to emergency services. This Service does not include any component of the Mental Health Services reported under Service four “Mental Health Services”.

3. Public Hospital Non-admitted Services
The provision of major rural hospital services to patients who do not undergo a formal admission process, inclusive of public patients treated by private facilities under contract to WA Health. This Service includes services provided to patients in outpatient clinics, community based clinics or in the home, procedures, medical consultation, allied health or treatment provided by clinical nurse specialists. Public Hospital Non-Admitted Services includes teaching, training and research activities provided by the public health service to facilitate development of skills and acquisition or advancement of knowledge related to nonadmitted services. This Service does not include any component of the Mental Health Services reported under Service four “Mental Health Services”.

4. Mental Health Services
The provision of inpatient services where an admitted patient occupies a bed in a designated mental health facility or a designated mental health unit in a hospital setting; and the provision of non-admitted services inclusive of community and ambulatory specialised mental health programs such as prevention and promotion, community support services, community treatment services, community bed based services and forensic services. This Service includes the provision of state-wide mental health services such as perinatal mental health and eating disorder outreach programs as well as the provision of assessment, treatment, management, care or rehabilitation of persons experiencing alcohol or other drug use problems or cooccurring health issues. Mental Health Services includes teaching, training and research activities provided by the public health service to facilitate development of skills and acquisition or advancement of knowledge related to mental health or alcohol and drug services. This service includes public patients treated in private facilities under contract to WA Health.

5. Aged and Continuing Care Services
The provision of aged and continuing care services and community based palliative care services. Aged and continuing care services include programs that assess the care needs of older people, provide functional interim care or support for older, frail, aged and younger people with disabilities to continue living independently in the community and maintain independence, inclusive of the services provided by the WA Quadriplegic Centre. Aged and Continuing Care Services is inclusive of community based palliative care services that are delivered by private facilities under contract to WA Health, which focus on the prevention and relief of suffering, quality of life and the choice of care close to home for patients.

6. Public and Community Health Services
The provision of healthcare services and programs delivered to increase optimal health and wellbeing, encourage healthy lifestyles, reduce the onset of disease and disability, reduce the risk of long-term illness as well as detect, protect and monitor the incidence of disease in the population. Public and Community Health Services includes public health programs, Aboriginal health programs, disaster management, environmental health, the provision of grants to non-government organisations for public and community health purposes, emergency road and air ambulance services, services to assist rural based patients travel to receive care, and statewide pathology services provided to external WA Agencies.

7. Small Rural Hospital Services
Provides emergency care & limited acute medical/minor surgical services in locations 'close to home' for country residents/visitors, by small & rural hospitals classified as block funded. Include community care services aligning to local community needs.

2.2 Schedule of income and expenses by service

 Public Hospital Admitted Services 2019
$000
Public Hospital Admitted Services 2018
$000
Public Hospital Emergency Services 2019
$000
Public Hospital Emergency Services 2018
$000
Public Hospital Non-Admitted Services 2019
$000
Public Hospital Non-Admitted Services 2018
$000
Mental Health Services (a) 2019
$000
Mental Health Services (a) 2018
$000
COST OF SERVICES
Expenses
Employee benefits expense 391,081 363,315 169,658 160,562 62,869 63,147 94,258 86,005
Fees for visiting medical practitioners 49,098 43,639 21,606 20,599 10,151 9,193 535 378
Patient support costs 135,612 125,477 34,701 32,280 20,509 20,482 4,476 3,934
Finance costs 52 81 14 22 8 12 0 -
Depreciation and amortisation expense 33,425 30,767 10,612 9,610 5,350 4,829 198 207
Asset revaluation decrement 5,806 6,851 2,203 1,230 1,055 527 (4) 351
Loss on disposal of non-current assets 186 2,306 48 559 29 345 1 0
Repairs, maintenance and consumable equipment 19,344 18,345 5,827 5,811 3,355 3,269 2,444 2,252
Other expenses  50,251 41,201 20,785 16,912 9,614 7,136 19,267 26,090
Total cost of services 684,855 631,982 265,454 247,585 112,940 108,940 121,175 119,217
Income
Patient charges 20,264 19,381 2,782 1,618 17,128 17,335 381 307
Commonwealth grants and contributions 212,681 199,127 66,450 54,609 42,161 34,207 28,226 25,754
Other grants and contributions 1,897 2,216 2,642 2,278 1,152 1,211 88,737 83,677
Donation revenue 321 270 35 115 6 15 17 13
Other revenue 7,983 7,674 2,757 2,923 2,329 2,112 991 1,514
Total income other than income from State Government 243,146 228,668 74,666 61,543 62,776 54,880 118,352 111,265
NET COST OF SERVICES 441,709 403,314 190,788 186,042 50,164 54,060 2,823 7,952
INCOME FROM STATE GOVERNMENT
Service appropriations 404,106 370,360 155,694 157,575 50,851 47,529 - -
Assets assumed (16) 38 (15) (26) 1 (4) (3) (12)
Services received free of charge 21,562 19,718 3,870 7,704 1,659 3,390 1,106 3,710
Royalties for Regions Fund 4,661 4,314 23,787 13,564 649 1,870 1,003 688
Total income from State Government 430,313 394,430 183,336 178,817 53,160 52,785 2,106 4,386
DEFICIT FOR THE PERIOD (11,396) (8,884) (7,452) (7,225) 2,996 (1,275) (717) (3,566)

(a) Includes services in addition to those provided under agreement with the Mental Health Commission for specialised admitted patients and community mental health.

The Schedule of Income and Expenses by Service should be read in conjunction with the accompanying notes.

2.2 Schedule of income and expenses by service (continued)

<td >81,572
 Aged and Continuing Care Services
2019
$000
Aged and Continuing Care Services
2018
$000
Public and Community Health Services
2019
$000
Public and Community Health Services
2018
$000
Small Rural Hospital Services 2019
$000
Small Rural Hospital Services 2018
$000
Total 2019
$000
Total 2018
$000
COST OF SERVICES
Expenses
Employee benefits expense 94,109 95,025 121,983 115,656 123,005 119,003 1,056,963 1,002,713
Fees for visiting medical practitioners 354 205 533 794 11,077 11,051 93,354 85,859
Patient support costs 13,444 17,174 144,526 147,083 37,558 34,694 390,826 381,124
Finance costs 0 - - 1 14 22 88 138
Depreciation and amortisation expense 2,781 2,575 4,184 3,787 24,539 22,230 81,089 74,005
Asset revaluation decrement (11) 878 (40) 3,162 12,652 4,567 21,661 17,566
Loss on disposal of non-current assets 34 22 17 22 56 152 371 3,406
Repairs, maintenance and consumable equipment 1,975 3,019 3,727 3,830 9,544 12,674 46,216 49,200
Other expenses 16,195 18,754 32,645 31,918 26,858 23,548 175,615 165,559
Total cost of services 128,881 137,652 307,575 306,253 245,303 227,941 1,866,183 1,779,570
Income
Patient charges 11,897 11,997 8,934 12,982 3,528 3,567 64,914 67,187
Commonwealth grants and contributions 56,279 43,994 13,971 24,989 97,662 101,501 517,430 484,181
Other grants and contributions 703 1,819 4,297 4,049 506 402 99,934 95,652
Donation revenue 28 18 49 39 39 81 495 551
Other revenue 2,207 2,667 2,079 2,770 2,410 2,929 20,756 22,589
Total income other than income from State Government 71,114 60,495 29,330 44,829 104,145 108,480 703,529 670,160
NET COST OF SERVICES 57,767 77,157 278,244 261,424 141,158 119,461 1,162,654 1,109,410
INCOME FROM STATE GOVERNMENT
Service appropriations 48,587 64,090 203,319 227,679 103,265965,822 948,805
Assets assumed (11) (12) (9) (30) (11) (21) (64) (67)
Services received free of charge 2,764 3,700 9,951 9,529 14,374 7,622 55,286 55,373
Royalties for Regions Fund 3,606 6,440 43,604 18,308 19,660 26,539 96,970 71,723
Total income from State Government 54,946 74,218 256,865 255,486 137,288 115,712 1,118,014 1,075,834
DEFICIT FOR THE PERIOD (2,821) (2,939) (21,380) (5,938) (3,870) (3,749) (44,640) (33,576)

The Schedule of Income and Expenses by Service should be read in conjunction with the accompanying notes.

Note 3: Use of our funding

Expenses incurred in the delivery of services

This section provides additional information about how WA Country Health Service's funding is applied and the accounting policies that are relevant for an understanding of the items recognised in the financial statements. The primary expenses incurred by WA Country Health Service in achieving its objectives and the relevant notes are:

 Notes2019
$000
2018
$000
Employee benefits expense 3.1(a) 1,056,963 1,002,713
Employee benefits provisions 3.1(b) 184,298 171,286
Patient support costs 3.2 484,180 466,983
Repairs, maintenance, consumable equipment and other expenses 3.3 221,831 214,759

3.1(a) Employee benefits expense

 2019
$000
2018
$000
Salaries and wages 978,250 927,098
Superannuation - defined contribution plans 78,713 75,615
  1,056,963 1,002,713

Salaries and wages

Salaries and wages comprise of all costs related to employment including the value of the fringe benefits to employees plus the fringe benefits tax component, the value of superannuation contribution component of leave entitlements and redundancy payments.

Superannuation expenses

The superannuation expense recognised in the Statement of Comprehensive Income comprises employer contribution to the Gold State Superannuation Scheme (GSS), the West State Superannuation Scheme (WSS), the GESB Super Scheme (GESBS), or other superannuation funds. The employer contribution paid to the GESB in respect of the GSS is paid back to the Consolidated Account by the GESB.

The Government Employees Superannuation Board (GESB) and other fund providers administer public sector superannuation arrangements in Western Australia in accordance with legislative requirements. Eligibility criteria for membership in particular schemes for public sector employees vary according to commencement and implementation dates.

The GSS is a defined benefit scheme for the purposes of employees and whole-of-government reporting. However, it is a defined contribution plan for agency purposes because the concurrent contributions (defined contributions) made by WA Country Health Service to GESB extinguishes WA Country Health Service's obligations to the related superannuation liability.

The WA Country Health Service has no liabilities under the Pension Scheme or the GSS. The liabilities for the unfunded Pension Scheme and the unfunded GSS transfer benefits attributable to members who transferred from the Pension Scheme, are assumed by the Treasurer. All other GSS obligations are funded by concurrent contributions made by WA Country Health Service to the GESB.

3.1(b) Employee related provisions

Provision is made for benefits accruing to employees in respect of salaries and wages, annual leave, time off in lieu leave and long service leave for services rendered up to the reporting date and recorded as an expense during the period the services are delivered.

 2019
$000
2018
$000
Current
Employee benefits provisions
Annual leave (a) 71,112 64,774
Time off in lieu leave (a) 29,089 31,189
Long service leave (b) 49,103 44,025
Gratuities (c) 2,099 1,226
Deferred salary scheme (d) 2,748 2,187
  154,151 143,401
Non-current
Employee benefits provisions
Long service leave (b) 29,427 27,198
Gratuities (c) 720 687
  30,147 27,885
  184,298 171,286

(a) Annual leave liabilities and time off in lieu leave liabilities are classified as current liabilities as WA Country Health Service does not have an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting period.

Assessments indicate that actual settlement of the liabilities is expected to occur as follows:

 2019
$000
2018
$000
Within 12 months of the end of the reporting period 81,345 77,449
More than 12 months after the end of the reporting period 18,856 18,514
  100,201 95,963

The provision for annual leave and time off in lieu leave is calculated at the present value of expected payments to be made in relation to services provided by employees up to the reporting date.

(b) Unconditional long service leave provisions are classified as current liabilities as WA Country Health Service does not have an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting period.

Pre-conditional and conditional long service leave provisions are classified as non-current liabilities because WA Country Health Service has an unconditional right to defer settlement of the liability until the employee has completed the requisite years of service.

Assessments indicate that actual settlement of the liabilities is expected to occur as follows:

 2019
$000
2018
$000
Within 12 months of the end of the reporting period 13,646 11,718
More than 12 months after the end of the reporting period 64,884 59,505
  78,530 71,223

The provision for long service leave is calculated at present value as WA Country Health Service does not expect to wholly settle the amounts within 12 months. The present value is measured taking into account the present value of expected future payments to be made in relation to services provided by employees up to the reporting date. These payments are estimated using the remuneration rate expected to apply at the time of settlement, and discounted using market yields at the end of the reporting period on national government bonds with terms to maturity that match, as closely as possible, the estimated future cash outflows.

(c) The provision for gratuity relates to WA Country Health Service's employees who become qualified for gratuity payment upon completion of continuous services as specified in industrial awards. The payment will be made in the first pay period on or after the date the entitlement falls due.

(d) The provision for the deferred salary scheme relates to WA Country Health Service's employees who have entered into an agreement to self-fund an additional twelve months leave to be taken in the fifth year of the agreement. Deferred salary scheme liabilities are classified as current liabilities as WA Country Health Service does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting period.

Assessments indicate that actual settlement of the liabilities is expected to occur as follows:

 2019
$000
2018
$000
Within 12 months of the end of the reporting period 1,027 538
More than 12 months after the end of the reporting period 1,721 1,649
  2,748 2,187

Key sources of estimation uncertainty – long service leave

Key estimates and assumptions concerning the future are based on historical experience and various other factors that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.

Several estimates and assumptions are used in calculating the WA Country Health Serviceʼs long service leave provision. These include:

  • Expected future salaries rates
  • Discount rates
  • Employee retention rates; and
  • Expected future payments

Changes in these estimations and assumptions may impact on the carrying amount of the long service leave provision.

Any gain or loss following revaluation of the present value of long service leave liabilities is recognised as employee benefits expense.

3.2 Patient support costs

 2019
$000
2018
$000
Fees for visiting medical practitioners 93,354 85,859
Medical supplies and services 83,016 80,038
Domestic charges 11,065 10,320
Fuel, light and power 33,640 30,690
Food supplies 10,950 10,670
Patient transport costs 92,230 93,452
Aboriginal health services 38,126 36,367
Pathology services 43,188 41,557
Purchase of health care services 15,288 13,845
Purchase of outsourced medical services 29,842 28,526
Purchase of other outsourced services 27,872 25,192
Grant payments 5,609 10,467
Total patient support costs 484,180 466,983

Patient support costs are recognised as an expense in the reporting period in which they are incurred. The carrying amounts of any materials held for distribution are expensed when the materials are distributed.

Pathology services represent the value of pathology service provided by Pathwest, which was part of North Metropolitan Health Service in 2018. $23.3 million (2018: $23.5 million) of these services are provided free of charge and the corresponding revenue is reflected under Services Received Free of Charge.

3.3 Repairs, maintenance, consumable equipment and other expenses

 2019
$000
2018
$000
Repairs, maintenance and consumable equipment

Repairs and maintenance
26,375 29,617
Consumable equipment 19,841 19,583
Total repairs, maintenance and consumable equipment expenses 46,216 49,200
Other expenses
Communications 4,981 5,107
Computer services 2,761 2,049
Workers compensation insurance 14,066 13,935
Other employee related expenses 32,171 29,190
Insurance 6,285 6,161
Legal expenses 428 506
Motor vehicle expenses 5,800 5,110
Operating lease expenses 27,185 27,298
Printing and stationery 4,521 4,067
Doubtful debts expense (a) - 1,514
Expected credit losses expense (a) 3,443 -
Purchase of outsourced services 25,019 21,095
Shared services costs 31,824 31,799
Other 17,131 17,728
Total other expenses 175,615 165,559

Other operating expenses generally represent the day-to-day running costs incurred in normal operations.

Repairs and maintenance costs are recognised as expenses as incurred, except where they relate to the replacement of a significant component of an asset. In that case, the costs are capitalised and depreciated.

Doubtful debt expense is recognised as the movement in the provision for doubtful debt. Please refer to note 6.1.1 'Movement of the allowance for impairment of receivables'.

Shared services costs represent the value of services related to Information technology, Human resources, Supply and Finance provided by the Health Support Services during the financial year. These services are provided free of charge and the corresponding revenue is reflected under Services Received Free of Charge.

(a) Doubtful debt expense was recognised as the movement in the allowance for doubtful debts. From 2018-19, expected credit losses expense is recognised as the movement in the allowance for expected credit losses. The allowance for expected credit losses of trade receivables is measured at the lifetime expected credit losses at each reporting date. WA Country Health service has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. Refer to note 6.1.1 'Movement in the allowance for impairment of trade receivables'.

Note 4: Our funding sources

How we obtain our funding

This section provides additional information about how WA Country Health Service obtains its funding and the relevant accounting policy notes that govern the recognition and measurement of this funding. The primary income received by WA Country Health Service and the relevant notes are:

 Notes2019
$000
2018
$000
Income from State Government 4.1 1,118,014 1,075,834
Commonwealth grants and contributions 4.2 517,430 484,181
Other grants and contributions 4.3 99,934 95,652
Patient charges 4.4 64,914 67,187
Other revenue 4.5 20,756 22,589

4.1 Income from State Government

Appropriation received during the period:

 2019
$000
2018
$000
Service appropriation (a) 965,822 948,805
  965,822 948,805

Assets transferred from/(to) other State government agencies during the period: (b)

 2019
$000
2018
$000
Medical equipment to Pathwest (53) -
Medical equipment from South Metropolitan Health Services 34 -
Furniture to North Metropolitan Health Services (45) -
Medical equipment from East Metropolitan Health Services - 24
Medical equipment from Child and Adolescent Health Services - 104
Plant and equipment from Child and Adolescent Health Services - 6
Medical equipment to Health Support Services - (201)
Total assets transferred (64) (67)

Services received free of charge from other State government agencies during the period: (c)

 2019
$000
2018
$000
Department of Finance - government accommodation 148 92
Pathwest 23,314 -
North Metropolitan Health Service (PathWest) - 23,482
Health Support Services 31,824 31,799
Total services received 55,286 55,373

Royalties for Regions Fund:

Regional Community Services Account: (d)

 2019
$000
2018
$000
Regional Workers Incentives Allowance Payments 7,879 7,878
Ear, Eye and Oral Health - 1,872
Expand the ear bus program 999 616
Digital Innovation, Transport and Access to Care - Recurrent 15,875 -
Digital Innovation, Transport and Access to Care - Patient Assisted Travel Scheme 45,485 -
Patient Assisted Travel Scheme - 11,009
Valley View Aged Care Centre 500 -
Renal Dialysis - Recurrent 443 -
Regional Palliative Care - 500
Meet and Greet Service 280 200
Royal Flying Doctor Service - 2,792

Regional Infrastructure Headworks Account: (d)

 2019
$000
2018
$000
Pilbara Health Partnership 3,272 2,860
Renal Dialysis Service Expansion - 920
Busselton ICT - 915
District Medical Workforce Investment Program (Stream 1) - 18,599
Residential Aged and Dementia Care Investment Program 1,915 5,222
Telehealth Investment Program (Stream 5) - 4,750
District Medical Workforce Program 20,322 13,590
Total Royalties for Regions Fund 96,970 71,723
Total income from State Government 1,118,014 1,075,834

(a) Service appropriations are recognised as revenue at fair value in the period in which WA Country Health Service gains control of the appropriated funds. WA Country Health Service gains control of appropriated funds at the time those funds are deposited in the bank account or credited to the ʻAmounts receivable for servicesʼ (holding account) held at Treasury.

Service appropriations fund the net cost of services delivered (as set out in note 2.2). Appropriation revenue comprises the following:

  • Cash component; and
  • A receivable (asset).

The receivable (holding account – note 6.2) comprises the following:

  • The budgeted depreciation expense for the year; and
  • Any agreed increase in leave liabilities during the year.

(b) Transfer of assets: Discretionary transfers of assets (including grants) and liabilities between State government agencies are reported under Income from State Government. Transfers of assets and liabilities in relation to a restructure of administrative arrangements are recognised as distribution to owners by the transferor and contribution by owners by the transferee under AASB 1004. Other non discretionary non-reciprocal transfers of assets and liabilities designated as contributions by owners under TI 955 are also recognised directly to equity.

(c) Services received free of charge or for nominal cost, are recognised as revenues at the fair value of those services that can be reliably measured and which would have been purchased if they were not donated. Services received free of charge from Health Support Service are corporate service including Finance, Human Resources, Supply and Information Technology. Pathwest provides some pathology services free of charge and the total pathology costs is recorded in Patient support costs (Note 3.2).

(d) The Regional Community Services Account and the Regional Infrastructure and Headworks Account are sub-funds within the over-arching ʻRoyalties for Regions Fundʼ. The recurrent funds are committed to projects and programs in WA regional areas and are recognised as revenue when WA Country Health Service gains control on receipt of the funds.

4.2 Commonwealth grants and contributions

 2019
$000
2018
$000
Recurrent
National Health Reform Agreement via the Department of Health (a) 404,573 376,330
National Health Reform Agreement via the Mental Health Commission (a) 27,545 24,909
Multi Purpose Service Units 28,161 29,547
Home and Community Care Program - 10,560
Commonwealth Home Support Programme 15,322 -
Other 33,689 30,834
Capital
Bringing Renal Dialysis & Support Services Closer 5,000 9,000
Strengthening Regional Cancer Services 2,480 3,000
Other 660 1
  517,430 484,181

(a) Activity based funding and block grant funding is received from the Commonwealth Government under the National Health Reform Agreement for services, health teaching, training and research provided by local hospital networks (Health Services). The funding arrangement established under the Agreement requires the Commonwealth Government to make funding payments to the State Pool Account from which distributions to the local hospital networks (Health Services) are made by the Department of Health and Mental Health Commission.

4.3 Other grants and contributions

 2019
$000
2018
$000
Recurrent
Mental Health Commission - service delivery agreement 74,538 71,386
Mental Health Commission - SSAMHS 6,791 5,546
Mental Health Commission - Community drug and alcohol service 5,155 4,821
Disability Services Commission - Community aids and equipment program 2,124 2,655
Other 11,326 11,244
  99,934 95,652

Grant income arises from transactions described as:

  • Non reciprocal (where WA Country Health Service does not provide approximate equal value in return to a party providing goods or assets (or extinguishes a liability); or
  • Reciprocal (where WA Country Health Service provides equal value to the recipient of the grant provider).

The accounting for these are set out below.

For non-reciprocal grants, WA Country Health Service recognises revenue when the grant is receivable at its fair value as and when its fair value can be reliably measured.

For reciprocal grants, WA Country Health Service recognises income when it has satisfied its performance obligations under the terms of the grant.

Grants can further be split between:

  • General purpose grants
  • Specific purpose grants

General purpose grants refers to grants which are not subject to conditions regarding their use. Specific purpose grants are received for a particular purpose and/or have conditions attached regarding their use.

4.4 Patient charges

 2019
$000
2018
$000
Inpatient bed charges 26,063 26,379
Outpatient charges 38,851 40,808
  64,914 67,187

4.5 Other revenue

 2019
$000
2018
$000
Services to external organisations 6,713 7,481
Use of hospital facilities 2,425 2,493
Rent from commercial properties 1,103 755
Rent from residential properties 282 325
Staff and boarders' accommodation 7,380 7,984
Home and Community Care client fees 1,446 1,680
RiskCover insurance premium rebate 112 666
Other 1,295 1,205
  20,756 22,589

Revenue on provision of services is recognised by reference to the stage of completion of the transaction.

Note 5: Key assets

Assets WA Country Health Service utilises for economic benefit or service potential

This section includes information regarding the key assets WA Country Health Service utilises to gain economic benefits or provide service potential. The section sets out both the key accounting policies and financial information about the performance of these assets:

 Notes2019
$000
2018
$000
Property, plant and equipment 5.1 1,884,776 1,916,214
Intangible assets 5.2 18,842 17,338
Total key assets   1,903,618 1,933,552

5.1 Property, plant and equipment

 Land
$000
Buildings
$000
Buildings under const.
$000
Site Infra.
$000
Leasehold improv.
$000
Computer equip.
$000
Furniture and fittings
$000
Motor vehicles
$000
Medical equip.
$000
Other plant
and equip.
$000
Other works in progress
$000
Artworks
$000
Total
$000
Year ended 30 June 2019
1 July 2018

Gross carrying amount
82,282 1,285,768 318,515 196,987 1,176 5,627 2,478 1,363 46,161 9,844 5,017 75 1,955,293
Accumulated depreciation - - - (20,102) (609) (2,031) (340) (771) (13,221) (2,005) - - (39,079)
Carrying amount at start of period 82,282 1,285,768 318,515 176,885 567 3,596 2,138 592 32,940 7,839 5,017 75 1,916,214
Additions - 284 60,837 83 - 453 683 499 7,364 1,805 5,436 315 77,759
Transfers from/(to) other reporting entities 125 - -   - - (45) - (19) - - - 61
Transfers between asset classes (50) 301,439 (334,466) 30,855 - (508) (1,232) 46 3,640 1,863 (3,400) (5) (1,818)
Other disposals - (9) - - (45) - (40) - (223) (54) - - (371)
Revaluation increments/(decrements) (318) (21,343) - - - -     - - - - (21,661)
Impairment losses - - - - - -     - - - - -
Impairment losses reversed - - - - - -     - - - - -
Depreciation - (58,195) - (11,571) (91) (1,170) (180) (251) (5,958) (1,470) - - (78,886)
Write-down of assets - - (4,998) - - (42) (55) - (51) (7) (1,369) - (6,522)
Carrying amount at 30 June 2019 82,039 1,507,944 39,888 196,252 431 2,329 1,269 886 37,693 9,976 5,684 385 1,884,776
Gross carrying amount 82,039 1,507,944 39,888 226,520 1,051 5,529 1,774 1,908 56,649 13,457 5,684 385 1,942,828
Accumulated depreciation - - - (30,268) (620) (3,200) (505) (1,022) (18,956) (3,481) - - (58,052)
  82,039 1,507,944 39,888 196,252 431 2,329 1,269 886 37,693 9,976 5,684 385 1,884,776
Year ended 30 June 2018
1 July 2017
Gross carrying amount 100,941 1,259,933 187,814 187,938 1,175 4,539 2,084 770 39,480 6,960 5,080 70 1,796,784
Accumulated depreciation - - - (9,892) (304) (658) (171) (520) (6,926) (895)     (19,366)
Carrying amount at start of period 100,941 1,259,933 187,814 178,046 871 3,881 1,913 250 32,554 6,065 5,080 70 1,777,418
Additions - 537 225,576 153 - 165 1,006 593 6,752 2,120 4,656 5 241,563
Transfers from/(to) other reporting entities (2,256) (1,072) - - - - - - (73) 6 - - (3,395)
Transfers between asset classes - 82,610 (91,282) 9,560 - 1,328 (313) - 392 812 (3,328) - (221)
Other disposals - (2,690) - (597) - - (15) - (78) (26) - - (3,406)
Revaluation increments/(decrements) (16,398) (1,168) - - - - - - - - - - (17,566)
Impairment losses - - - - - - - - - - - - -
Impairment losses reversed - - - - -   - - - - - - -
Depreciation - (52,382) - (10,277) (304) (1,372) (170) (251) (6,324) (1,116) - - (72,196)
Write-down of assets (5) - (3,593) - - (406) (283) - (283) (22) (1,391) - (5,983)
Carrying amount at 30 June 2018 82,282 1,285,768 318,515 176,885 567 3,596 2,138 592 32,940 7,839 5,017 75 1,916,214
Gross carrying amount 82,282 1,285,768 318,515 196,987 1,176 5,627 2,478 1,363 46,161 9,844 5,017 75 1,955,293
Accumulated depreciation - - - (20,102) (609) (2,031) (340) (771) (13,221) (2,005) - - (39,079)
  82,282 1,285,768 318,515 176,885 567 3,596 2,138 592 32,940 7,839 5,017 75 1,916,214

Information on fair value measurements is provided in Note 8.3

Initial recognition

Items of property, plant and equipment and infrastructure, costing $5,000 or more are measured initially at cost. Where an asset is acquired for no or nominal cost, the cost is valued at its fair value at the date of acquisition. Items of property, plant and equipment and infrastructure costing less than $5,000 are immediately expensed direct to the Statement of Comprehensive Income (other than where they form part of a group of similar items which are significant in total).

Assets transferred as part of a machinery of government change are transferred at their fair value.

The cost of a leasehold improvement is capitalised and depreciated over the shorter of the remaining term of the lease or the estimated useful life of the leasehold improvement.

Subsequent measurement

Subsequent to initial recognition of an asset, the revaluation model is used for the measurement of land and buildings.

Land is carried at fair value and buildings are carried at fair value less accumulated depreciation and accumulated impairment losses.

All other property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses.

Land and buildings are independently valued annually by the Western Australian Land Information Authority (Valuations and Property Analytics) and recognised annually to ensure that the carrying amount does not differ materially from the assetʼs fair value at the end of the reporting period.

Land and buildings were revalued as at 1 July 2018 by the Western Australian Land Information Authority (Valuation and Property Analytics). The valuations were performed during the year ended 30 June 2019 and recognised at 30 June 2019. In undertaking the revaluation, fair value was determined by reference to the market value for land: $33.409 million (2018: $31.334 million) and buildings: $68.690 million (2018: $68.604 million). For the remaining balance, fair value of buildings was determined on the basis of current replacement cost and fair value of land was determined on the basis of comparison with market evidence for land with low level utility (high restricted use land).

Revaluation model:

1. Fair value where market-based evidence is available:

The fair value of land and buildings is determined on the basis of current market values determined by reference to recent market transactions.

2. Fair value in the absence of market-based evidence:

Buildings are specialised or where land is restricted: Fair value of land and buildings is determined on the basis of existing use.

Existing use buildings: Fair value is determined by reference to the cost of replacing the remaining future economic benefits embodied in the asset, i.e. the current replacement cost.

Restricted use land: Fair value is determined by comparison with market evidence for land with similar approximate utility (high restricted use land) or market value of comparable unrestricted land (low restricted use land).

When buildings are revalued, the accumulated depreciation is eliminated against the gross carrying amount of the asset and the net amount restated to the revalued amount.

Significant assumptions and judgements: The most significant assumptions and judgements in estimating fair value are made in assessing whether to apply the existing use basis to assets and in determining estimated economic life. Professional judgement by the valuer is required where the evidence does not provide a clear distinction between market type assets and existing use assets.

5.1.1 Depreciation and impairment

Charge for the period

 2019
$000
2018
$000
Depreciation
Buildings 58,195 52,382
Site Infrastructure 11,571 10,277
Leasehold improvements 91 304
Computer equipment 1,170 1,372
Furniture and fittings 180 170
Motor vehicles 251 251
Medical equipment 5,958 6,324
Other plant and equipment 1,470 1,116
Total depreciation for the period 78,886 72,196

As at 30 June 2019 there were no indications of impairment to property, plant and equipment.

Please refer to note 5.2.1 for guidance in relation to the impairment assessment that has been performed for intangible assets.

Finite useful lives

All property, plant and equipment having a limited useful life are systematically depreciated over their estimated useful lives in a manner that reflects the consumption of their future economic benefits. The exceptions to this rule include assets held for sale, land and investment properties.

Depreciation is calculated on a straight line basis, at rates that allocate the assetʼs value, less any estimated residual value, over its estimated useful life. Estimated useful lives for the different asset classes for current and prior years are:

  • Buildings - 50 years
  • Site infrastructure - 50 years
  • Leasehold improvements - Shorter of the lease term and useful life
  • Computer equipment - 4 to 10 years
  • Furniture and fittings - 10 to 20 years
  • Motor vehicles - 2 to 10 years
  • Medical equipment - 3 to 20 years
  • Other plant and equipment - 4 to 30 years

The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period, and adjustments made where appropriate.

Land and artworks, which are considered to have an indefinite life, are not depreciated. Depreciation is not recognised in respect of these assets because their service potential has not, in any material sense, been consumed during the reporting period.

Impairment

Non-financial assets, including items of property, plant and equipment, are tested for impairment whenever there is an indication that the asset may be impaired. Where there is an indication of impairment, the recoverable amount is estimated. Where the recoverable amount is less than the carrying amount, the asset is considered impaired and is written down to the recoverable amount and an impairment loss is recognised.

Where an asset measured at cost is written down to its recoverable amount, an impairment loss is recognised through profit or loss. Where a previously revalued asset is written down to its recoverable amount, the loss is recognised as a revaluation decrement through other comprehensive income.

As WA Country Health Service is a not-for-profit entity, the recoverable amount of regularly revalued specialised assets is anticipated to be materially the same as fair value.

If there is an indication that there has been a reversal in impairment, the carrying amount shall be increased to its recoverable amount. However this reversal should not increase the assetʼs carrying amount above what would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years.

The risk of impairment is generally limited to circumstances where an assetʼs depreciation is materially understated, where the replacement cost is falling or where there is a significant change in useful life. Each relevant class of assets is reviewed annually to verify that the accumulated depreciation/amortisation reflects the level of consumption or expiration of the assetʼs future economic benefits and to evaluate any impairment risk from declining replacement costs.

5.1.2 Revaluation decrements
 2019
$000
2018
$000
Land 318 16,398
Buildings 21,343 1,168
  21,343 17,566
5.1.3 Loss on disposal of non-current assets
 2019
$000
2018
$000
Net proceeds from disposal of non-current assets:
Property, plant and equipment
- -
Carrying amount of non-current assets:
Property, plant and equipment
371 3,406
Net loss 371 3,406

Realised and unrealised losses are usually recognised on a net basis. These include losses arising on the disposal of noncurrent assets and some revaluations of non-current assets.

Losses on the disposal of non-current assets are presented by deducting from the proceeds on disposal the carrying amount of the asset and related selling expenses. Losses are recognised in profit or loss in the statement of comprehensive income.

Selling expenses (e.g. sales commissions netted from WA Country Health Service's receipts) are ordinarily immaterial.

5.2 Intangible assets

 Computer software
$000
Works in progress
$000
Total
$000
Year ended 30 June 2019
1 July 2018
Gross carrying amount 16,212 4,272 20,484
Accumulated amortisation (3,146) - (3,146)
Carrying amount at start of period 13,066 4,272 17,338
Additions - 3,068 3,068
Transfers from work in progress 5,433 (5,433) -
Transfers between asset classes 1,818 - 1,818
Amortisation expense (2,203) - (2,203)
Write-down of assets - (1,179) (1,179)
Carrying amount at 30 June 2019 18,114 728 18,842
Year ended 30 June 2018
1 July 2017
Gross carrying amount 14,441 837 15,278
Accumulated depreciation (1,337) - (1,337)
Carrying amount at start of period 13,104 837 13,941
Additions - 5,101 5,101
Transfers from work in progress 1,550 (1,550) -
Transfers between asset classes 221 - 221
Impairment losses - - -
Impairment losses reversed - - -
Amortisation expense (1,809) - (1,809)
Write-down of assets - (116) (116)
Carrying amount at 30 June 2018 13,066 4,272 17,338
Initial recognition

Acquisitions of intangible assets costing $5,000 or more and internally generated intangible assets costing $5,000 or more that comply with the recognition criteria as per AASB 138.57, are capitalised.

Costs incurred below these thresholds are immediately expensed directly to the Statement of Comprehensive Income.

Intangible assets are initially recognised at cost. For assets acquired at no cost or for nominal cost, the cost is their fair value at the date of acquisition.

An internally generated intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following are demonstrated:

(a) The technical feasibility of completing the intangible asset so that it will be available for use or sale;

(b) An intention to complete the intangible asset and use or sell it;

(c) The ability to use or sell the intangible asset;

(d) The intangible asset will generate probable future economic benefit;

(e) The availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

(f) The ability to measure reliably the expenditure attributable to the intangible asset during its development.

Costs incurred in the research phase of a project are immediately expensed.

Subsequent measurement

The cost model is applied for subsequent measurement of intangible assets, requiring the asset to be carried at cost less any accumulated amortisation and accumulated impairment losses.

5.2.1 Amortisation and impairment

Charge for the period

 2019
$000
2018
$000
Computer software 2,203 1,809
Total amortisation for the period 2,203 1,809

As at 30 June 2019 there were no indications of impairment to intangible assets.

WA Country Health Service held no goodwill or intangible assets with an indefinite useful life during the reporting period. At the end of the reporting period there were no intangible assets not yet available for use.

Amortisation of finite life intangible assets is calculated on a straight line basis at rates that allocate the assetʼs value over its estimated useful life. All intangible assets controlled by WA Country Health Service have a finite useful life and zero residual value. Estimated useful lives are reviewed annually.

The estimated useful lives for each class of intangible asset are:

  • Computer software: 5 - 10 years

Computer software that is an integral part of the related hardware is recognised as property, plant and equipment. Software that is not an integral part of the related hardware is recognised as an intangible asset.

Impairment

Intangible assets with finite useful lives are tested for impairment annually or when an indication of impairment is identified.

The policy in connection with testing for impairment is outlined in note 5.1.1.

Note 6: Other assets and liabilities

This section sets out those assets and liabilities that arose from WA Country Health Service's controlled operations and includes other assets utilised for economic benefits and liabilities incurred during normal operations:

 Notes2019
$000
2018
$000
Receivables 6.1 20,469 23,647
Amounts receivable for services 6.2 832,856 748,497
Other assets 6.3 9,447 9,485
Payables 6.4 118,055 116,019

6.1 Receivables

 2019
$000
2018
$000
Current
Trade receivables: Patient fee debtors 15,355 13,100
Trade receivables: Non patient fee debtors 3,779 1,402
Allowance for impairment of receivables (10,063) (4,428)
Other receivables 1,414 1,500
Accrued revenue 4,832 6,117
GST receivable 5,152 5,956
Total receivables 20,469 23,647

Trade receivables are recognised at original invoice amount less any allowances for uncollectible amounts (i.e. impairment). The carrying amount of net trade receivables is equivalent to fair value as it is due for settlement within 30 days.

Other receivables are mainly bond payments on leased properties and are recognised at original value. These are not impaired as the bonds are expected to be refunded upon end of leases.

6.1.1. Movement of the allowance for impairment of receivables
 2019
$000
2018
$000
Reconciliation of changes in the allowance for impairment of receivables:
Balance at start of period 4,428 9,001
Remeasurement under AASB 9 2,159 -
Restated balance at start of period 6,587 9,001
Doubtful debts expense - 1,514
Expected credit losses expense 3,443 -
Amounts written off during the period - (6,149)
Amounts recovered during the period 33 62
Balance at end of period 10,063 4,428

The maximum exposure to credit risk at the end of the reporting period for trade receivables is the carrying amount of the asset inclusive of any allowance for impairment as shown in the table at Note 8.1 (c) 'Credit risk exposure'.

WA Country Health Service does not hold any collateral as security or other credit enhancements for trade receivables.

6.2 Amounts receivable for services (Holding Account)

 2019
$000
2018
$000
Non-current 832,856 748,497
Balance at end of period 832,856 748,497

Amounts receivable for services represent the non-cash component of service appropriations. It is restricted in that it can only be used for asset replacement or payment of

Amounts receivable for services are not considered to be impaired (that is there is no expected credit loss of the holding accounts).

6.3 Other assets

 2019
$000
2018
$000
Current
Supply inventories 2,203 2,259
Pharmaceutical inventories 2,659 2,638
Other inventories 106 260
Prepayments 4,479 4,328
Balance at end of period 9,447 9,485

Inventories are measured at the lower of cost and net realisable value. Costs are assigned on a weighted average cost basis.

Inventories not held for resale are measured at cost unless they are no longer required, in which case they are measured at net realisable value.

Prepayments are payments in advance of receipt of goods or services or that part of expenditure made in one accounting period covering a term extending beyond that period.

6.4 Payables

 2019
$000
2018
$000
Current
Trade payables 14,244 19,290
Accrued expenses 86,659 82,091
Accrued salaries 17,147 14,628
Accrued interest 5 10
Balance at end of period 118,055 116,019

Payables are recognised at the amounts payable when WA Country Health Service becomes obliged to make future payments as a result of a purchase of assets or services. The carrying amount is equivalent to fair value, as settlement is generally within 30 days.

Accrued salaries represent the amount due to staff but unpaid at the end of the reporting period. Accrued salaries are settled within a fortnight of the reporting period. WA Country Health Service considers the carrying amount of accrued salaries to be equivalent to its fair value.

Note 7: Financing

This section sets out the material balances and disclosures associated with the financing and cashflows of WA Country Health Service.

 Notes
Borrowings                                                                                                                           7.1
Finance costs                                                                                                                       7.2
Cash and cash equivalents                                                                                                  7.3
Reconciliation of cash 7.3.1
Reconciliation of operating activities 7.3.2
Commitments 7.4
Non-cancellable operating lease commitments 7.4.1
Capital commitments 7.4.2
Other expenditure commitments 7.4.3

7.1 Borrowings

 2019
$000
2018
$000
Current
Department of Treasury loans (a)
1,865 1,779
Non-Current
Department of Treasury loans (a)
- 1,865
  1,865 3,644

7.2 Finance costs

 2019
$000
2018
$000
Interest expense (a) 88 138
  88 138

(a) All loans payable are initially recognised at fair value, being the net proceeds received. Subsequent measurement is at amortised cost using the effective interest rate method. Interest incurred are expensed as finance costs.

7.3 Cash and cash equivalents

7.3.1 Reconciliation of cash
 Notes2019
$000
2018
$000
Cash and cash equivalents   20,434 18,173
Restricted cash and cash equivalents (a) 8.1    
Royalties for Regions Fund   2,233 1,141
Capital grant from the Commonwealth Government (b)   12,662 16,512
Patient receipts under section 19 (2) of the Health Insurance Act 1973   4,389 4,838
Bequests   746 763
Mental Health Commission Funding (note 9.7)   260 234
Other   5,461 1,854
Accrued salaries suspense account (c)   7,463 7,463
Balance at end of period   53,648 50,978

(a) Restricted cash and cash equivalents are assets, the uses of which are restricted, by specific legal or other externally imposed requirements.

(b) Unspent funds from the Commonwealth Government are committed to projects and programs in WA regional areas.

(c) Funds held in the suspense account for the purpose of meeting the 27th pay in a reporting period that occurs every 11th year. This account is classified as non current for 10 out of 11 years.

For the purpose of the statement of cash flows, cash and cash equivalent (and restricted cash and cash equivalent) assets comprise cash on hand and short-term deposits with original maturities of three months or less that are readily convertible to a known amount of cash and which are subject to insignificant risk of changes in value.

7.3.2 Reconciliation of net cost of services to net cash flows used in operating activities
 Notes2019
$000
2018
$000
Non-cash items
Net cost of services   1,162,654 1,109,410
Depreciation and amortisation expense 5.1.1, 5.2.1 (81,089) (74,005)
Asset revaluation decrement 5.1.2 (21,661) (17,566)
Loss from disposal of non-current assets 5.1.3 (371) (3,406)
Interest paid by Department of Health   (93) (144)
Donation of non-current assets   - 30
Services received free of charge 4.1 (55,286) (55,373)
Write down of property, plant and equipment 5.1, 5.2 (7,701) (6,099)
Adjustment for other non-cash items   - (2)
Increase/(decrease) in assets
Receivables (a)   (1,019) (105)
Other assets   (38) (852)
(Increase)/decrease in liabilities
Payables (a)   (14,262) (8,554)
Current provisions   (10,750) (11,795)
Non-current provisions   (2,262) (1,480)
Other current liabilities   (311) (30)
Net cash used in operating activities   967,811 930,029

(a) Note that the sale/purchase of non-current assets are not included in these items as they do not form part of the reconciling items.

The mandatory application of AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107 imposed disclosure impacts only. WA Country Health Service is not exposed to changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes.

7.4 Commitments

The commitments below are inclusive of GST where relevant.

7.4.1 Non-cancellable operating lease commitments

Commitments for minimum lease payments are payable as follows:

 2019
$000
2018
$000
Within 1 year 13,550 12,211
Later than 1 year and not later than 5 years 17,599 14,471
Later than 5 years 1,559 43
  32,708 26,725

Operating leases are expensed on a straight line basis over the lease term as this represents the pattern of benefits derived from the leased properties.

Operating lease commitments predominantly consist of contractual agreements for office accommodation and residential accommodation. The basis of which contingent operating leases payments are determined is the value for each lease agreement under the contract terms and conditions at current values.

Prior year figure of $13.971 million has be restated to $26.725 million which now includes motor vehicle lease commitments to Statefleet.

7.4.2 Capital commitments

Capital expenditure commitments, being contracted capital expenditure additional to the amounts reported in the financial statements, are payable as follows:

 2019
$000
2018
$000
Within 1 year 30,906 78,339
Later than 1 year and not later than 5 years 123,268 40,512
later than 5 years - -
  154,174 118,851
7.4.3 Other expenditure commitments

Other expenditure commitments contracted for at the end of the reporting period but not recognised as liabilities, are payable as follows:

 2019
$000
2018
$000
Within 1 year 168,040 176,993
Later than 1 year and not later than 5 years 47,456 61,096
later than 5 years 119 949
  215,615 239,038

Judgements made by management in applying accounting policies – operating lease commitments

WA Country Health Service has entered into a number of leases for buildings for branch office accommodation. Some of these leases relate to buildings of a temporary nature and it has been determined that the lessor retains substantially all the risks and rewards incidental to ownership. Accordingly, these leases have been classified as operating leases.

Note 8: Risks and Contingencies

This note sets out the key risk management policies and measurement techniques of WA Country Health Service.

 Notes
Financial risk management 8.1
Contingent assets 8.2.1
Contingent liabilities 8.2.2
Fair value measurements 8.3

8.1 Financial risk management

Financial instruments held by WA Country Health Service are cash and cash equivalents, restricted cash and cash equivalents, receivables, payables, and borrowings. WA Country Health Service has limited exposure to financial risks. WA Country Health Service's overall risk management program focuses on managing the risks identified below.

(a) Summary of risks and risk management

Credit risk

Credit risk arises when there is the possibility of WA Country Health Service's receivables defaulting on their contractual obligations resulting in financial loss to WA Country Health Service.

Credit risk associated with WA Country Health Service's financial assets is minimal because the main receivable is the amounts receivable for services (holding account). For receivables other than Government, WA Country Health Service trades only with recognised, creditworthy third parties. WA Country Health Service has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. In addition, receivable balances are monitored on an ongoing basis with the result that WA Country Health Service's exposure to bad debts is minimal. Debt will be written off against the allowance account when it is improbable or uneconomical to recover the debt. At the end of the reporting period there were no significant concentrations of credit risk.

Liquidity risk

Liquidity risk arises when the agency is unable to meet its financial obligations as they fall due.

WA Country Health Service is exposed to liquidity risk through its trading in the normal course of business.

WA Country Health Service has appropriate procedures to manage cash flows including drawdown of appropriations by monitoring forecast cash flows to ensure that sufficient funds are available to meet its commitments.

Market risk

Market risk is the risk that changes in market prices such as foreign exchange rates and interest rates will affect WA Country Health Service's income or the value of its holdings of financial instruments. WA Country Health Service does not trade in foreign currency and is not materially exposed to other price risks. WA Country Health Service's exposure to market risk for changes in interest rates relate primarily to the long-term debt obligations.

WA Country Health Service's borrowings are with the Department of Treasury and are at variable interest rates with varying maturities. Other than as detailed in the interest rate sensitivity analysis table at Note 8.1(e), WA Country Health Service is not exposed to interest rate risk because the majority of cash and cash equivalents and restricted cash are non-interest bearing and it has no borrowings other than the Treasurerʼs loans.

(b) Categories of financial instruments

The carrying amounts of each of the following categories of financial assets and financial liabilities at the end of the reporting period are:

 2019
$000
2018
$000
Financial assets
Cash and cash equivalents 53,648 50,978
Loans and receivables (a) - 766,188
Financial assets measured at amortised cost (a) 848,173 -
Total financial assets 901,821 817,166
Financial Liabilities
Financial liabilities measured at amortised cost 119,920 119,663
Total financial liability 119,920 119,663

(a) The amounts of Loans and receivables and Financial assets measured at amortised cost exclude GST recoverable from the ATO (statutory receivable).

(c) Credit risk exposure

The following table details the credit risk exposure on WA Country Health Service's trade receivables using a provision matrix.

 Total
$000
Days past due:
Current
$000
Days past due:
<30 days
$000
Days past due:
31-60 days
$000
Days past due:
61-90 days
$000
Days past due:
>91 days
$000
30 June 2019
Expected credit loss rate   7% 10% 17% 34% 77%
Estimated total gross carrying amount at default 19,134 3,611 1,745 977 876 11,925
Expected credit losses (10,063) (242) (179) (169) (297) (9,176)
1 July 2018 (Remeasurement)
Expected credit loss rate   8% 11% 32% 41% 71%
Estimated total gross carrying amount at default 14,502 3,719 1,485 802 661 7,835
Expected credit losses (6,587) (311) (162) (258) (271) (5,585)

(a) The amount of receivables excludes the GST recoverable from ATO (statutory receivable).

(d) Liquidity risk and interest rate exposure

The following table details WA Country Health Service's interest rate exposure and the contractual maturity analysis of financial assets and financial liabilities. The maturity analysis section includes interest and principal cash flows. The interest rate exposure section analyses only the carrying amounts of each item.

Interest rate exposure and maturity analysis of financial assets and financial liabilities

 Interest rate exposure: Weighted average  effective interest rate
%
Interest rate exposure: Carrying amount
$000
Interest rate exposure: Fixed interest rate
$000
Interest rate exposure: Variable interest rate
$000
Interest rate exposure: Non- interest bearing
$000
Nominal Amount
$000
Maturity dates: Up to 1 month
$000
Maturity dates: 1-3 months
$000
Maturity dates: 3 months to 1 year
$000
1-5 years
$000
Maturity dates: More than 5 years
$000
2019
Financial Assets
Cash and cash equivalents - 53,648 - - 53,648 53,648 53,648 - - - -
Receivables (a) - 15,317 - - 15,317 15,317 15,317 - - - -
Amounts receivable for service - 832,856 - - 832,856 832,856 - - - - 832,856
    901,821 - - 901,821 901,821 68,965 - - - 832,856
Financial Liabilities
Payables - 118,055 - - 118,055 118,055 118,055 - - - -
Department of Treasury Loans          3.15% 1,865 - 1,865 - 1,922 160 320 1,442 - -
    119,920 - 1,865 118,055 119,977 118,215 320 1,442 - -
2018
Financial Assets
Cash and cash equivalents - 50,978 - - 50,978 50,978 50,978 -   - -
Receivables (a) - 17,691 - - 17,691 17,691 17,691 - - - -
Amounts receivable for service - 748,497 - - 748,497 748,497 - - - - 748,497
    817,166 - - 817,166 817,166 68,669 - - - 748,497
Financial Liabilities
Payables - 116,019 - - 116,019 116,019 116,019 -   - -
Department of Treasury Loans          3.06% 3,644 - 3,644 - 3,819 158 315 1,419 1,927 -
    119,663 - 3,644 116,019 119,838 116,177 315 1,419 1,927 -

(a) The amount of receivables excludes the GST recoverable from ATO (statutory receivable).

(e) Interest rate sensitivity analysis

The following table represents a summary of the interest rate sensitivity of WA Country Health Serviceʼs financial assets and liabilities at the end of the reporting period on the surplus for the period and equity for a 1% change in interest rates. It is assumed that the change in interest rates is held constant throughout the reporting period.

 Carrying amount
$000
-100 basis points: Surplus
$000
-100 basis points: Equity
$000
+100 basis points: Surplus
$000
+100 basis points: Equity
$000
2019
Financial Liabilities
Department of Treasury Loans 1,865 19 19 (19) (19)
Total Increase/(Decrease)   19 19 (19) (19)
2018
Financial Liabilities
Department of Treasury Loans 3,644 36 36 (36) (36)
Total Increase/(Decrease)   36 36 (36) (36)

8.2 Contingent assets and liabilities

Contingent assets and contingent liabilities are not recognised in the statement of financial position but are disclosed and, if quantifiable, are measured at the best estimate.

Contingent assets and liabilities are presented inclusive of GST receivable or payable respectively.

8.2.1 Contingent assets

At the reporting date, WA Country Health Service is not aware of any contingent assets.

8.2.2 Contingent liabilities

The following contingent liabilities are excluded from the liabilities included in the financial statements:

 2019
$000
2018
$000
Litigation in progress:
Pending litigation that are not recoverable from RiskCover insurance and may affect the financial position of WA Country Health Service. 2,560 1,212
Number of claims 10 6
Contaminated sites
Estimated cost to remediate contaminated and suspected contaminated sites reported to the Department of Water and Environmental Regulation. - 70

Under the Contaminated Sites Act 2003, WA Country Health Service is required to report known and suspected contaminated sites to the Department of Water and Environmental Regulation (DWER). In accordance with the Act, DWER classifies these sites on the basis of the risk to human health, the environment and environmental values. Where sites are classified as contaminated – remediation required or possibly contaminated – investigation required, WA Country Health Service may have a liability in respect of investigation or remediation expenses.

Hospital cladding

The Department of Health is continuing to coordinate a Cladding Audit and Remediation Program across all buildings within the Health built asset portfolio. The purpose of the review is to establish if any building contains aluminium composite cladding (ACP) that may present a fire risk under the amended National Construction Code 2016 and Australian Standard AS 5113:2016 Fire propagation testing and classification of external walls of buildings.

There are currently no envisaged works on any WA Country Health Service property, however these reviews are ongoing and as such, at this time of reporting, the final extent of costs associated with activities relating to the remediation of identified aluminium composite cladding is unable to be quantified.

8.3 Fair value measurement

(a) Fair value hierarchy

AASB 13 requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:

1) quoted prices (unadjusted) in active markets for identical assets (level 1).
2) input other than quoted prices included within level 1 that are observable for the asset either directly or indirectly (level 2); and
3) Inputs for the asset that are not based on observable market data (unobservable input) (level 3).

 Level 1
$000
Level 2
$000
Level 3
$000
Fair value at end of period
$000
Assets measured at fair value 2019
Land
Vacant land - 2,680 - 2,680
Residential - 30,729 - 30,729
Specialised - -                               48,630 48,630
Buildings
Residential - 68,690 - 68,690
Specialised - - 1,439,254 1,439,254
  - 102,099 1,487,884 1,589,983
Assets measured at fair value 2018
Land
Vacant land - 2,817 - 2,817
Residential - 28,517 - 28,517
Specialised - - 50,948 50,948
Buildings
Residential - 68,604 - 68,604
Specialised - - 1,217,164 1,217,164
  - 99,938 1,268,112 1,368,050
(b) Valuation technique to derive Level 2 fair values

Level 2 fair values of land and buildings are derived using the market approach. Market evidence of sales prices of comparable land and buildings in close proximity is used to determine price per square metre.

(c) Fair value measurements using significant unobservable inputs (Level 3)
 Land
$000
Buildings
$000
2019
Fair value at start of period 50,948 1,217,164
Additions (including transfer from works in progress) 75 298,528
Revaluation increments/(decrements) recognised in Profit or Loss (459) (19,534)
Transfers from/(to) Level 2 (a) (1,934) (97)
Disposals - (9)
Depreciation expense - (56,798)
Fair value at end of period 48,630 1,439,254
2018
Fair value at start of period 58,041 1,195,605
Fair value transferred from abolished entity - 82,887
Additions (including transfer from works in progress) (5,383) (3,205)
Revaluation increments/(decrements) recognised in Profit or Loss 170 (4,649)
Disposals (1,880) (2,590)
Depreciation expenses - (50,884)
Fair value at end of period 50,948 1,217,164

(a) Fair value measurements hierarchy changed from level 3 to level 2 represent land and buildings previously reflected at cost for which market values were provided in 2018-19.

(b) Fair value measurements hierarchy changed from level 3 to level 2 for buildings represents residential accommodation buildings constructed in previous period and reflected at cost for which market values were provided in 2017-18.

(c) Fair value measurements hierarchy changed from level 2 to level 3 for land represents vacant land reflected at cost as there was no market value provided.

Valuation processes

There were no changes in valuation techniques during the period.

Land (Level 3 fair values)

Fair value for restricted use land is based on comparison with market evidence for land with low level utility (high restricted use land). The relevant comparators of land with low level utility is selected by the Western Australian Land Information Authority (Valuations and Property Analytics) and represents the application of a significant Level 3 input in this valuation methodology. The fair value measurement is sensitive to values of comparator land, with higher values of comparator land correlating with higher estimated fair values of land.

Buildings (Level 3 fair values)

Fair value for existing use specialised buildings is determined by reference to the cost of replacing the remaining future economic benefits embodied in the asset, i.e. the current replacement cost. Current replacement cost is generally determined by reference to the market observable replacement cost of a substitute asset of comparable utility and the gross project size specifications, adjusted for obsolescence. Obsolescence encompasses physical deterioration, functional (technological) obsolescence and economic (external) obsolescence.

Valuation using current replacement cost utilises the significant Level 3 input, consumed economic benefit/obsolescence of asset which is estimated by the Western Australian Land Information Authority (Valuations and Property Analytics). The fair value measurement is sensitive to the estimate of consumption/obsolescence, with higher values of the estimate correlating with lower estimated fair values of buildings.

Basis of valuation

In the absence of market-based evidence, due to the specialised nature of some non financial assets, these assets are valued at Level 3 of the fair value hierarchy on an existing use basis. The existing use basis recognises that restrictions or limitations have been placed on their use and disposal when they are not determined to be surplus to requirements. These restrictions are imposed by virtue of the assets being held to deliver a specific community service.

Note 9: Other disclosures

This section includes additional material disclosures required by accounting standards or other pronouncements, for the understanding of this financial report.

 Notes
Events occurring after the end of the reporting period 9.1
Initial application of Australian Accounting Standards 9.2
Future impact of Australian standards issued not yet operative 9.3
Key management personnel  9.4
Related party transactions  9.5
Related bodies 9.6
Affiliated bodies  9.7
Special purpose accounts 9.8
Remuneration of auditors 9.9
Equity 9.10
Supplementary financial information 9.11
Explanatory statement 9.12
Administered trust accounts 9.13

9.1 Events occurring after the end of the reporting period

There were no events occurring after the reporting period which had significant financial effects on these financial statements.

9.2 Initial application of Australian Accounting Standards

AASB 9 Financial instruments

AASB 9 Financial instruments replaces AASB 139 Financial instruments: Recognition and Measurements for annual reporting periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments: classification and measurement; impairment; and hedge accounting.

WA Country Health Service applied AASB 9 prospectively, with an initial application date of 1 July 2018. The adoption of AASB 9 has resulted in changes in accounting policies and adjustments to the amount recognised in the financial statements. In accordance with AASB 9.7.2.15, WA Country Health Service has not restated the comparative information which continues to be reported under AASB 139. Differences arising from adoption have been recognised directly in Accumulated deficit.

The effect of adopting AASB 9 as at 1 July 2018 was, as follows:

 Adjustments1 July 2018
$000
Assets
Trade receivables (a), (b) (2,159)
Total adjustments on Equity
Accumulated deficit. (a), (b) (2,159)

The nature of these adjustments are described below:

(a) Classification and measurement

Under AASB 9, financial assets are subsequently measured at amortised cost, fair value through other comprehensive income (fair value through OCI) or fair value through profit or loss (fair value through P/L). The classification is based on two criteria: WA Country Health Service's business model for managing the assets; and whether the assets' contractual cash flows represents 'solely payments of principal and interest' on the principal amount outstanding.

The assessment of WA Country Health Service's business model was made as of the date of initial application, 1 July 2018. The assessment of whether contractual cash flows on financial assets are solely comprised of principal and interest was made based on the facts and circumstances at the time of initial recognition of the assets.

The classification and measurement requirements of AASB 9 did not have a significant impact on WA Country Health Service. The following are the changes in the classification of WA Country Health Service's financial assets:

  • Receivables and Amounts receivable for services are classified as Loans and receivables in 2018.
  • Trade receivables as at 30 Jun 2018 are held to collect contractual cash flows and give rise to cash flows representing solely payments of principal. These are classified and measured as Financial assets at amortised cost beginning 1 Jul 2018.
  • WA Country Health Service did not designate any financial assets as at fair value through P/L.

In summary, upon the adoption of AASB 9, WA Country Health Service had the following reclassifications as at 1 July 2018:

 $000AASB 9 category:
Amortised cost
$000
AASB 9 category:
Fair value through OCI
$000
AASB 9 category:
Fair value through P/L
$000
AASB 139 category
Trade receivables* 10,074 7,915 - -
Other receivables 7,617 7,617 - -
Amounts receivable for service 748,497 748,497 - -
    764,029 - -

* The change in carrying amount is a result of additional impairment allowance. See discussion on impairment below.

(b) Impairment

The adoption of AASB 9 has fundamentally changed WA Country Health Service's accounting for impairment losses for financial assets by replacing AASB 139's incurred loss approach with a forward-looking expected credit loss (ECL) approach. AASB 9 requires WA Country Health Service to recognise an allowance for ECLs for trade receivables not held at fair value through P/L.

Upon adoption of AASB 9, WA Country Health Service recognised an additional impairment on its Trade receivables of $2.159 million which resulted in an increase in Accumulated deficit of $2.159 million as at 1 July 2018.

Set out below is the reconciliation of the ending impairment allowances in accordance with AASB 139 to the opening loss allowances determined in accordance with AASB 9.

 Impairment under AASB 139 as at 30 Jun 2018
$000
Remeasurement
$000
ECL under AASB 9 as at 1 Jul 2018
$000
Total receivables (4,428) (2,159) (6,587)
  (4,428) (2,159) (6,587)

9.3 Future impact of Australian Accounting Standards not yet operative

WA Country Health Service cannot early adopt an Australian Accounting Standard unless specifically permitted by TI 1101 Application of Australian Accounting Standards and Other Pronouncements or by an exemption from TI 1101. Where applicable, WA Country Health Service plans to apply the following Australian Accounting Standards from their application date.

  Operative for reporting periods beginning on/after
AASB 15

Revenue from Contracts with Customers

This Standard establishes the principles that WA Country Health Service shall apply to report useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from a contract with customers. The mandatory effective date of this Standard is currently 1 January 2019 after being amended by AASB 2016-7.

WA Country Health Service's income is primarily derived from appropriations which will be measured under AASB 1058 and thus will not be materially affected by this change. However, WA Country Health Service has not yet determined the potential impact of the Standard on ʻGrants and contributionsʼ revenues. In broad terms, it is anticipated that the terms and conditions attached to these revenues will defer revenue recognition until WA Country Health Service has discharged its performance obligations.

WA Country Health Service will adopt the modified retrospective approach on transition to AASB 15. No comparative information will be restated under this approach, and WA Country Health Service will recognise the cumulative effect of initially applying the Standard as an adjustment to the opening balance of accumulated deficit at the date of initial application.

01 Jan 2019
AASB 16

Leases

This Standard introduces a single lessee accounting model and requires a lessee to recognise assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value.

The initial recognition of additional assets and liabilities, mainly from operating leases, will increase WA Country Health Service's total assets by $22.44 million and total liabilities by $22.44 million. In addition, interest and depreciation expenses will increase, offset by a decrease in rental expense for the year ending 30 June 2020 and beyond.

The above assessment is based on the following accounting policy positions:

  • Option 2 of the modified retrospective approach on transition;
  • The 'low value asset' threshold set at AUD $5,000 (unless GROH, GOA or State Fleet);
  • For leases classified as 'short term' (12 months or less), these are not recognised under AASB 16 (unless GROH, GOA or State Fleet);
  • Land, buildings and investment property ROU assets are measured under the fair value model, subsequent to initial recognition; and
  • Discount rates are sourced from WA Treasury Corporation (WATC).

WA Country Health Service will adopt the modified retrospective approach on transition to AASB 16. No comparative information will restated under this approach and it will recognise the cumulative effect of initially applying the Standard as an adjustment to the opening balance of accumulated deficit at the date of initial application.

01 Jan 2019
AASB 1058

Income of Not-for-Profit Entities

This Standard clarifies and simplifies the income recognition requirements that apply to not-for-profit (NFP) entities, more closely reflecting the economic reality of NFP entity transactions that are not contracts with customers. Timing of income recognition is dependent on whether such a transaction gives rise to a liability or other performance obligation (a promise to transfer a good or service), or a contribution by owners, related to an asset (such as cash or another asset) received by an entity.

AASB 1058 will have no impact on appropriations and recurrent grants received by WA Country Health Service - they will continue to be recognised as income when funds are deposited in the bank account or credited to the holding account.

WA Country Health Service will adopt the modified retrospective approach on transition to AASB 1058. No comparative information will be restated under this approach, and because revenue from capital grants received by WA Country Health Service are fully recognised in accordance with AASB 1004 Contributions at the date of initial application, there is nil cumulative effect of initially applying the Standard and no adjustment to the opening balance of accumulated deficit is required.

01 Jan 2019
AASB 1059

Service Concession Arrangements: Grantors

This Standard addresses the accounting for a service concession arrangement (a type of public private partnership) by a grantor that is a public sector entity by prescribing the accounting for the arrangement from the grantorʼs perspective. Timing and measurement for the recognition of a specific asset class occurs on commencement of the arrangement and the accounting for associated liabilities is determined by whether the grantee is paid by the grantor or users of the public service provided.

The mandatory effective date of this Standard is currently 1 January 2020 after being amended by AASB 2018-5.

WA Country Health Service has not identified any public private partnerships within scope of the Standard.

01 Jan 2020
AASB 2016-8

Amendments to Australian Accounting Standards – Australian Implementation Guidance for Not for Profit Entities

This Standard inserts Australian requirements and authoritative implementation guidance for not-for-profit entities into AASB 9 and AASB 15. This guidance assists not-for-profit entities in applying those Standards to particular transactions and other events. There is no financial impact.

01 Jan 2019
AASB 2018-4

Amendments to Australian Accounting Standards – Australian Implementation Guidance for Not for Profit Licensors

This Standard amends AASB 15 to add requirements and authoritative implementation guidance for application by not-for-profit public sector licensors to transactions involving the issue of licences. There is no financial impact as WA Country Health Service does not issue licences.

01 Jan 2019
AASB 2018-5

Amendments to Australian Accounting Standards – Deferral of AASB 1059

This Standard amends the mandatory effective date of AASB 1059 so that AASB 1059 is required to be applied for annual reporting periods beginning on or after 1 January 2020 instead of 1 January 2019. There is no financial impact.

01 Jan 2019
AASB 2018-7

Amendments to Australian Accounting Standards – Definition of material

This Standard clarifies the definition of material and its application by improving the wording and aligning the definition across AASB Standards and other publications. There is no financial impact.

01 Jan 2020
AASB 2018-8

Amendments to Australian Accounting Standards – Right-of-Use Assets of Not-for-Profit entities

This Standard provides a temporary option for not-for-profit entities to not apply the fair value initial measurement requirements for right-of-use assets arising under leases with significantly below-market terms and conditions principally to enable the entity to further its objectives.

WA Country Health Service will elect to apply the option to measure right-of-use assets under peppercorn leases at cost (which is generally about $1). As a result, the financial impact of this Standard is not material.

01 Jan 2019

9.4 Key management personnel

WA Country Health Service has determined that key management personnel include cabinet ministers, board members and senior officers of WA Country Health Service. WA Country Health Service does not incur expenditures to compensate Ministers and those disclosures may be found in the Annual Report on State Finances.

Compensation of members of the accountable authority
 20192018
Compensation Band
$0 - $10,000 - 1
$10,001 - $20,000 1 -
$30,001 - $40,000 1 -
$40,001 - $50,000 7 7
$70,001 - $80,000 1 1
  10 9
 2019
$000
2018
$000
Short-term employee benefits 389 344
Post-employment benefits 37 33
Other long-term benefits - -
Termination benefits - -
Total remuneration of members of the accountable authority 426 377

The short-term employee benefits includes salary and travel allowances incurred by WA Country Health Service in respect of the accountable authority.

Compensation of Senior officers

The number of senior officers other than senior officers reported as members of the Accountable Authority, whose total fees, salaries, superannuation, non-monetary benefits and other benefits for the financial year, falling within the following bands are:

 20192018
Compensation Band ($)    
$  10,001 - $ 20,000 - 1
$  60,001 - $ 70,000 2 1
$ 100,001 - $110,000 1 -
$110,001 - $120,000 1 -
$150,001 - $160,000 1 -
$160,001 - $170,000 1 -
$170,001 - $180,000 2 1
$190,001 - $200,000 1 2
$200,001 - $210,000 1 4
$210,001 - $220,000 5 2
$220,001 - $230,000 2 1
$230,001 - $240,000 4 4
$260,001 - $270,000 - 3
$330,001 - $340,000 1 -
$410,001 - $420,000 1 -
$440,001 - $450,000 - 1
$450,001 - $460,000 1 -
$460,001 - $470,000 - 1
  24 21
 2019
$000
2018
$000
Short-term employee benefits 4,176 3,888
Post-employment benefits 434 421
Other long-term benefits 461 434
Termination benefits - -
Total remuneration of senior officers 5,071 4,743

The short-term employee benefits includes salary, motor vehicle benefits, district and travel allowances incurred by WA Country Health Service in respect of senior officers.

9.5 Related party transactions

WA Country Health Service is a wholly owned public sector entity that is controlled by the State of Western Australia.

Related parties of WA Country Health Service include:

  • all cabinet ministers and their close family members, and their controlled or jointly controlled entities;
  • all senior officers and their close family members, and their controlled or jointly controlled entities;
  • other departments and statutory authorities, including related bodies, that are included in the whole of government consolidated financial statements (i.e. wholly-owned public sector entities);
  • associates and joint ventures of a wholly-owned public sector entity; and
  • the Government Employees Superannuation Board (GESB).
Significant transactions with Government-related entities

In conducting its activities, WA Country Health Service is required to transact with the State and entities related to the State. These transactions are generally based on the standard terms and conditions that apply to all agencies. Significant transactions include:

 2019
$000
2018
$000
Income from State Government - Service appropriations (Note 4.1) 965,822 948,805
Equity contribution (Note 9.10):
- capital appropriations from State Government 16,282 27,781
- equity injections from Royalties for Regions Fund 70,691 206,831
Services received free of charge (Note 4.1):
- corporate services from Health Support Services 31,824 31,799
- pathology services from North Metropolitan Health Service (PathWest) - 23,482
Income from Royalties for Regions Fund (Note 4.1) 23,314 71,723
Commonwealth grant funding received under the National Health Reform Agreement (Note 4.2):
- via the Department of Health 404,573 376,330
- via Mental Health Commission 27,545 24,909
Other grant funding received from the Mental Health Commission (Note 4.3) 86,952 82,127
Insurance payments to the Insurance Commission and Riskcover fund 21,440 20,195
Remuneration for services provided by the Auditor General (Note 9.8) 588 570
Material transactions with other related parties
 2019
$000
2018
$000
Superannuation payments to GESB 72,364 70,741
Transactions with key management personnel

Outside of normal citizen type transactions with WA Country Health Service, there was no other related party transactions that involved key management personnel and/or their close family members and/or their controlled (or jointly controlled) entities.

9.6 Related bodies

A related body is a body which receives more than half its funding and resources from WA Country Health Service and is subject to operational control by WA Country Health Service.

WA Country Health Service had no related bodies during the financial year.

9.7 Affiliated bodies

An affiliated body is a body which receives more than half its funding and resources from WA Country Health Service but is not subject to operational control by WA Country Health Service.

WA Country Health Service had no affiliated bodies during the financial year.

9.8 Special purpose accounts

Mental Health Commission Fund (WA Country Health Service) Account

The purpose of the special purpose account is to receive funds from the Mental Health Commission, to fund the provision of mental health services as jointly endorsed by the Department of Health and the Mental Health Commission, in the WA Country Health Service, in accordance with the annual Service Agreement and subsequent agreements.

The special purpose account has been established under section 16(1)(d) of the Financial Management Act.

 2019
$000
2018
$000
Balance at start of period 234 955
Add Receipts:
Service delivery agreement
State contributions 86,952 82,127
Commonwealth contributions 27,545 24,909
  114,497 107,036
Less Payments (114,471) (107,757)
Balance at end of period 260 234

9.9 Remuneration of auditors

Remuneration paid or payable to the Auditor General in respect of the audit for the current financial year is as follows:

 2019
$000
2018
$000
Auditing the accounts, financial statements controls, and key performance indicators 588 570

9.10 Equity

The Western Australian Government holds the equity interest in WA Country Health Service on behalf of the community. Equity represents the residual interest in the net assets of WA Country Health Service.

Contributed equity

 2019
$000
2018
$000
Balance at start of period 2,541,924 2,310,640
Contributions by owners  
Capital appropriations (a) 16,282 27,781
Royalties for Regions Fund – Regional Infrastructure and Headworks Account 70,691 206,831
Transfer of net assets from other agencies (b):  
Land transferred from Department of Land 125 695
  87,098 235,307
Distributions to owners  
Transfer of net assets to other agencies (b):  
Land transferred to the Health Ministerial Body - (2,951)
Residential buildings transferred to the Health Ministerial Body  - (1,072)
  - (4,023)
Balance at end of period 2,629,022 2,541,924

(a) Treasurer's Instruction (TI) 955 'Contributions by Owners Made to Wholly Owned Public Sector Entities' designates capital appropriations as contributions by owners in accordance with AASB Interpretation 1038 'Contributions by Owners Made to Wholly- Owned Public Sector Entities'.

(b) AASB 1004 'Contributions' requires transfers of net assets as a result of a restructure of administrative arrangements to be accounted for as contributions by owners and distributions to owners.

TI 955 designates non-discretionary and non-reciprocal transfers of net assets between state government agencies as contributions by owners in accordance with AASB Interpretation 1038. Where the transferee agency accounts for a non-discretionary and nonreciprocal transfer of net assets as a contribution by owners, the transferor agency accounts for the transfer as a distribution to owners.

9.11 Supplementary financial information

(a) Write-offs

During the financial year, no amount (2018: $ 6.306 million) was written off WA Country Health Service's receivables under the authority of:

 2019
$000
2018
$000
The accountable authority - 6,306
The Minister - -
Executive Council - -
  - 6,306
(b) Losses through theft, defaults and other causes
 2019
$000
2018
$000
Losses of public money and property through theft or default - -
Amount recovered    
Net losses - -
(c) Gifts of public property
 2019
$000
2018
$000
Gifts of public property provided by WA Country Health Service - -

9.12 Explanatory statement

All variances between estimates (original budget) and actual results for 2019, and between the actual results for 2019 and 2018 are shown below. Narratives are provided for key major variances, which are generally greater than:

  • 5% and $25.0 million for the Statements of Comprehensive Income and Cash Flows, and
  • 5% and $25.0 million for the Statement of Financial Position.
9.12.1 Statement of Comprehensive Income variances
 Variance noteEstimate 2019
$000
Actual 2019
$000
Actual 2018
$000
Variance between estimate and actual
$000
Variance between actual results for 2019 and 2018
$000
COST OF SERVICES
Expenses
Employee benefits expense (a) 993,568 1,056,963 1,002,713 63,395 54,250
Fees for visiting medical practitioners   85,643 93,354 85,859 7,711 7,495
Patient support costs (b) 356,241 390,826 381,124 34,585 9,702
Finance costs   97 88 138 (9) (50)
Depreciation and amortisation expense   76,039 81,089 74,005 5,050 7,084
Asset revaluation decrement   - 21,661 17,566 21,661 4,095
Loss on disposal of non-current assets   - 371 3,406 371 (3,035)
Repairs, maintenance and consumable equipment   49,024 46,216 49,200 (2,808) (2,984)
Other expenses   187,329 175,615 165,559 (11,714) 10,056
Total cost of services   1,747,941 1,866,183 1,779,570 118,242 86,613
Income
Patient charges   72,987 64,914 67,187 (8,073) (2,273)
Commonwealth grants and contributions (c) 475,329 517,430 484,181 42,101 33,249
Other grants and contributions   109,728 99,934 95,652 (9,794) 4,282
Donation revenue   450 495 551 45 (56)
Other revenue   28,500 20,756 22,589 (7,744) (1,833)
Total Revenue   686,994 703,529 670,160 16,535 33,369
Total income other than income from State Government   686,994 703,529 670,160 16,535 33,369
NET COST OF SERVICES   1,060,947 1,162,654 1,109,410 101,707 53,244
INCOME FROM STATE GOVERNMENT
Service appropriations (d) 916,745 965,822 948,805 49,077 17,017
Assets assumed   - (64) (67) (64) 3
Services received free of charge   53,220 55,286 55,373 2,066 (87)
Royalties for Regions Fund (e) 106,512 96,970 71,723 (9,542) 25,247
Total income from State Government   1,076,477 1,118,014 1,075,834 41,537 42,180
DEFICIT FOR THE PERIOD    15,530 (44,640) (33,576) (60,170) (11,064)
OTHER COMPREHENSIVE INCOME/(LOSS)
Items not reclassified subsequently to profit or loss 
Total other comprehensive income    -  -  -  -  -
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE PERIOD    15,530 (44,640) (33,576) (60,170) (11,064)
9.12.2 Statement of Financial Position variances
 Variance noteEstimate 2019
$000
Actual 2019
$000
Actual 2018
$000
Variance between estimate and actual
$000
Variance between actual results for 2019 and 2018
$000
ASSETS
Current Assets
Cash and cash equivalents   13,727 20,434 18,173 6,707 2,261
Restricted cash and cash equivalents   26,165 25,751 25,342 (414) 409
Receivables   17,691 20,469 23,647 2,778 (3,178)
Other assets   9,485 9,447 9,485 (38) (38)
Total Current Assets   67,068 76,101 76,647 9,033 (546)
Non-Current Assets
Restricted cash and cash equivalents   11,086 7,463 7,463 (3,623) -
Amounts receivable for services (f) 824,536 832,856 748,497 8,320 84,359
Property, plant and equipment (g) 2,033,936 1,884,776 1,916,214 (149,160) (31,438)
Intangible assets   17,338 18,842 17,338 1,504 1,504
Total Non-Current Assets   2,886,896 2,743,937 2,689,512 (142,959) 54,425
Total Assets   2,953,964 2,820,038 2,766,159 (133,926) 53,879
LIABILITIES
Current Liabilities
Payables   105,147 118,055 116,019 12,908 2,036
Borrowings   1,866 1,865 1,779 (1) 86
Provisions   139,840 154,151 143,401 14,311 10,750
Other current liabilities   52 363 52 311 311
Total Current Liabilities   246,905 274,434 261,251 27,529 13,183
Non-Current Liabilities
Borrowings   - - 1,865 - (1,865)
Provisions   27,885 30,147 27,885 2,262 2,262
Total Non-Current Liabilities   27,885 30,147 29,750 2,262 397
Total Liabilities   274,790 304,581 291,001 29,791 13,580
NET ASSETS   2,679,174 2,515,457 2,475,158 (163,717) 40,299
EQUITY
Contributed equity   2,726,364 2,629,022 2,541,924 (97,342) 87,098
Accumulated deficit   (47,190) (113,565) (66,766) (66,375) (46,799)
TOTAL EQUITY   2,679,174 2,515,457 2,475,158 (163,717) 40,299
9.12.3 Statement of Cash Flows variances
 Variance noteEstimate 2019
$000
Actual 2019
$000
Actual 2018
$000
Variance between estimate and actual
$000
Variance between actual results for 2019 and 2018
$000
CASH FLOWS FROM STATE GOVERNMENT
Service appropriations   840,610 881,370 874,584 40,760 6,786
Capital appropriations   35,306 14,503 26,080 (20,803) (11,577)
Royalties for Regions Fund (h) 253,867 167,661 278,554 (86,206) (110,893)
Net cash provided by State Government   1,129,783 1,063,534 1,179,218 (66,249) (115,684)
Utilised as follows:            
CASH FLOWS FROM OPERATING ACTIVITIES
Payments
Employee benefits (a), (m) (993,568) (1,041,413) (997,236) (47,845) (44,177)
Supplies and services (n), (o) (625,018) (626,995) (604,092) (1,977) (22,903)
Receipts
Receipts from customers   72,988 63,126 64,412 (9,862) (1,286)
Commonwealth grants and contributions (i) 475,329 517,430 484,181 42,101 33,249
Other grants and contributions   109,727 99,934 95,653 (9,793) 4,281
Donations received   450 495 521 45 (26)
Other receipts   28,500 19,612 26,532 (8,888) (6,920)
Net cash used in operating activities   (931,592) (967,811) (930,029) (36,219) (37,782)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments
Purchase of non-current physical assets (j) (198,191) (93,053) (258,369) 105,138 165,316
Receipts
Proceeds from sale of non-current physical assets   - - -  - -
Net cash used in investing activities   (198,191) (93,053) (258,369)  105,138 165,316
Net increase / (decrease) in cash and cash equivalents   - 2,670 (9,180) 2,670 11,850
Cash and cash equivalents at the beginning of the period   50,978 50,978 60,158  - (9,180)
Cash and cash equivalents transferred from other sources   - - -  - -
CASH AND CASH EQUIVALENTS AT THE END OF PERIOD   50,978 53,648 50,978 2,670 2,670
Significant variances between estimates and actuals for 2019 and/or between actuals for 2019 and 2018

(a) Employee benefits expense

The variance between current year estimate and actual is primarily attributable to various new and ongoing services for which funding was not included in the initial estimates but were the subject of subsequent budget allocations throughout the year and at Mid-Year Review. These included additional funding for increased ABF Hospital activity ($19.6m), other State funded programs including Mental Health, Aboriginal Health, Small Hospitals and NDIS ($16.9m), Commonwealth funded programs including Commonwealth Home Support Services, Indigenous Australians Health programs, Aged care Assessment program and respite and home care services for which funding agreements had not been finalised at the time of the initial 2018-19 budget ($22.6m), Asset Investment Program payments expensed in accordance with Accounting Standards ($1.6m) and revised methodology for the valuation of Long Service Leave provisions in accordance with Accounting Standards ($2.7m).

The variance between current and last year results from the combined effect of an increase in FTE associated with growth in ABF hospital activity and other programs (3.2%), increased costs under industrial agreements (1.0%), a change in the methodology for valuing Long Service Leave provisions in accordance with Accounting Standards (0.3%) and other factors including increased reliance on locum medical and agency nursing staff to maintain services in rural and remote locations.

(b) Patient support costs

The variance between current year estimate and actual is attributable to various new and ongoing services for which funding was not included in the initial estimates but were the subject of subsequent budget allocations throughout the year and at Mid-Year Review ($15.8M) and to cost increases and pressures in excess of standard funding escalation including utilities, drugs and other medical supplies, and patient transport charges.($17.6m).

(c) Commonwealth grants and contributions

The variance between current year estimate and actual is primarily due to revenues for various continuing and new Commonwealth funded services such as Commonwealth Home Support Services, Indigenous Australians Health programs, Aged care Assessment program and respite and home care services for which funding agreements had not been finalised at the time of the initial 2018-19 budget and were the subject of subsequent budget adjustments ($30.3m). Activity at ABF Hospitals in excess of initial targets also resulted in additional NHRA contributions ($7.3m). In addition, $4.5m Commonwealth capital grant milestone payments were received during the year that had not been initially budgeted.

The variance between current and last year actuals is due to increased NHRA contributions resulting from additional activity ($30.9m), transition of the former HACC program from matched State and Commonwealth funding to the fully Commonwealth funded CHSP ($4.5m), the new Health Innovation Fund Stage 1 Tele Psychiatry program ($1.4m), and net movements in other service programs ($0.3m), offset by lower Commonwealth Capital Grants in the current year ($3.9m).

(d) Service appropriations

The variance between current year estimate and actual resulted from increased ABF Hospital activity ($18.8m), various other State funded programs including Aboriginal health, Small Hospitals and NDIS ($15.6m), Expensed capital ($2.0m), increased allocation for Depreciation ($8.3m), and revised estimates of the value of services received free of charge from Health Support Services ($1.9m), all of which were the subject of budget adjustments during the financial year. In addition State funding was received in lieu of an expected but delayed external grant payment ($2.4m).

(e) Royalties for regions fund

The variance between current year and last year actuals is primarily associated with the transition of PATS to being fully funded from Royalties for Regions from 2018-19.

9.12.2 Statement of Financial Position variances

(f) Amounts receivable for services

Amounts receivable for services represents the non-cash component of service appropriations that support asset replacement or the payment of leave liability. The variance between current and last year actuals is attributable to the increase in accrual appropriation for depreciation and amortisation expenses.

(g) Property, plant and equipment

The variance between current year estimate and actual is due to the combined effects of delays and recashflowing of various capital projects through the Mid Year Review and 2019-20 budget processes, depreciation charges higher than initially budgeted and the impact of asset revaluation decrements.

9.12.3 Statement of Cash Flow variances

(h) Royalties for regions fund

The variance between current year estimate and actual is due to reconfiguration and recashflowing of Royalties for Regions programs during the financial year. Variances included reprofiling and recashflowing for Newman Health Service redevelopment ($35.5m), Small Hospital and Nursing Home Refurbishments ($13.6m), Primary Health Centre Demonstration Program ($12.4m) , Onslow Health Service Redevelopment ($12.0m) and various other programs ($12.7m) as detailed in the 2018-19 Mid Year Review and the 2019-20 State budget documentation.

The variance between current year and last year cash inflows from Royalties for Regions is primarily associated with reduced funding for largely completed capital projects ($136.1m ) including Karratha Health Campus, the District Hospital Improvement Program and the Small Hospitals and Nursing Post Refurbishment Program, and increased funding for recurrent services ($25.2m) following the transition of PATS to being fully funded from Royalties for Regions from 2018-19.

(i) Commonwealth grants and contributions

The variance between current year estimate and actual is primarily due to revenues for various continuing and new Commonwealth funded services such as Commonwealth Home Support Services, Indigenous Australians Health programs, Aged care Assessment program and respite and home care services for which funding agreements had not been finalised at the time of the initial 2018-19 budget and were the subject of subsequent budget adjustments ($30.3m). Activity at ABF Hospitals in excess of initial targets also resulted in additional NHRA contributions ($7.3m). In addition, $4.5m Commonwealth capital grant milestone payments were received during the year that had not been initially budgeted.

The variance between current and last year actuals is due to increased NHRA contributions resulting from additional activity ($30.9m), transition of the former HACC program from matched State Commonwealth funding to fully Commonwealth funded CHSP ($4.5m) and the new Health Innovation Fund Stage 1 Tele Psychiatry program ($1.4m), net movements in other service programs ($0.3m), offset by lower Commonwealth Capital Grants in the current year ($3.9m).

(j) Payments for purchase of non-current physical assets

The variance between current year estimate and actual is due to recashflowing of Karratha Health Campus pending completion of the Defect Liability Period ($25.5m) and delays in the progress of various other projects, including Newman Health Service Redevelopment ($7.9m), Onslow Hospital ($11.7m), Renal Dialysis facilities ($8.8m), Primary Health Care Centre Demonstration Program ($12.4m), the Small Hospital and Nursing Post Refurbishment Program ($13.4m,) Carnarvon Residential Aged Care Facility ($7.9m), and various other projects ($17.5m) as detailed in the 2018-19 Mid Year Review and the 2019-20 State budget documentation.

The variance between current year and last year actuals is primarily associated with reduced expenditures for largely completed capital projects Including Karratha Health Campus ($60.2m), the District Hospital Improvement Program ($51.3m), the Small Hospitals and Nursing Post Refurbishment Program ($26.6m) and Onslow Hospital ($12.8m), and the net impact of milestone payments for various other projects($14.4m).

9.13 Administered trust accounts

Funds held in these trust accounts are not controlled by WA Country Health Service and are therefore not recognised in the financial statements.

WA Country Health Service administers trust accounts for the purpose of holding patients' private moneys.

A summary of the transactions for these trust accounts is as follows:

 2019
$000
2018
$000
Balance at the start of period 1,003 1,187
Add Receipts 891 891
  1,822 2,078
Less Payments (722) (1,075)
Balance at the end of period 1,100 1,003

Certification of key performance indicators

WA COUNTRY HEALTH SERVICE CERTIFICATION OF THE KEY PERFORMANCE INDICATORS FOR THE YEAR ENDED 30 JUNE 2019

We hereby certify the key performance indicators are based on proper records, are relevant and appropriate for assisting users to assess the WA Country Health Service’s performance and fairly represent the performance of the Health Service for the financial year ending 30 June 2018.

[Image (PDF only]: Professor Neale Fong signature]
Professor Neale Fong
Chair
WA Country Health Service Board
11 September 2019

[Image (PDF only]: Mr Alan Ferris signature]
Mr Alan Ferris
Board Member
WA Country Health Service Board
11 September 2019

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Key performance indicators

Section index

Outcome 1: Public hospital based services that enable effective treatment and restorative healthcare for Western Australians

  • Unplanned hospital readmissions of public hospital patients within 28 days for selected surgical procedures
  • Percentage of elective wait list patients waiting over boundary for reportable procedures
  • Healthcare-associated Staphylococcus aureus bloodstream infections
  • Survival rates for sentinel conditions
  • Percentage of admitted patients who discharged against medical advice
  • Percentage of live-born term infants with an Apgar score of less than 7 at 5 minutes post delivery
  • Readmissions to an acute specialised mental health inpatient service within 28 days discharge
  • Percentage of post discharge community care within 7 days following discharge from acute specialised mental health inpatient services
  • Average admitted cost per weighted activity unit
  • Average Emergency Department cost per weighted activity unit
  • Average non-admitted cost per weighted activity unit
  • Average cost per bed-day in specialised mental health inpatient services
  • Average cost per treatment day of non-admitted care provided by mental health services

Outcome 2: Prevention, health promotion and aged and continuing care services that help Western Australians to live healthy and safe lives

  • Response times for emergency air-based patient transport services
  • Percentage of patients who access emergency services at a small rural or remote Western Australian hospital and are subsequently discharged home
  • Average cost per bed-day for specialised residential care facilities, flexible care (hostels) and nursing home type residents
  • Average cost per person of delivering population health programs by population health units
  • Cost per trip of patient emergency air-based transport, based on the total accrued costs of these services per the total number of trips
  • Average cost per trip of Patient Assisted Travel Scheme (PATS)
  • Average cost per rural and remote population (selected small rural hospitals)

Outcome 1 - Effectiveness indicators

UNPLANNED HOSPITAL READMISSIONS FOR PATIENTS WITHIN 28 DAYS FOR SELECTED SURGICAL PROCEDURES

Rationale

Higher hospital readmission rates may be the result of patients being discharged prematurely and/or ineffective discharge planning and communication. Many unplanned hospital readmissions are associated with the original reason for hospitalisation. These readmissions necessitate patients spending additional periods of time in hospital as well as utilising additional hospital resources.

Readmission rate is considered a global performance measure, as it potentially points to deficiencies in the functioning of the overall healthcare system. Along with provision of appropriate interventions, good discharge planning can help to decrease the likelihood of unplanned hospital readmissions by providing patients with the care instructions they need after a hospital stay and helping patients recognise symptoms that may require medical attention.

The surgeries selected to be measured by this indicator are based on the 7 surgery types in the current National Health Agreement Unplanned Readmission performance indicator (NHA PI 23).

Target

The 2018-19 targets can be seen in the below table:

Surgical ProcedureTarget
Knee replacement ≤26.2
Hip replacement ≤17.2
Tonsillectomy & adenoidectomy ≤61.0
Hysterectomy ≤41.3
Prostatectomy ≤38.8
Cataract surgery ≤1.1
Appendicectomy ≤32.9

Results

The 2018 rate of unplanned readmissions within 28 days to a country hospital for selected surgical procedures can be seen in Table 8:

Table 8: Unplanned hospital readmissions within 28 days for selected surgical procedures

Surgical Procedure2016
(per 1,000)
2017
(per 1,000)
2017
(per 1,000)
Target
Knee replacement 22.6 37.9 37.7 ≤26.2
Hip replacement 36.7 21.8 23.5 ≤17.2
Tonsillectomy & adenoidectomy 46.2 61.6 86.6 ≤61.0
Hysterectomy 33.8 15.8 87.4 ≤41.3
Prostatectomy 89.3 40.4 44.2 ≤38.8
Cataract surgery 3.9 0.4 3.1 ≤1.1
Appendicectomy 41.2 39.2 50.3 ≤32.8

WA Country Health Service has not met target for any group of procedure readmission rates. The low number of cases may lead to significant fluctuation in year on year results as evidenced by the raw numbers of procedures followed by readmission:

  • Knee Replacement = 13 readmissions from 345 procedures
  • Hip Replacement = 7 readmissions from 298 procedures
  • Tonsillectomy and adenoidectomy = 29 readmissions from 335 procedures
  • Hysterectomy = 16 readmission from 183 procedures
  • Prostatectomy = 5 readmissions from 113 procedures
  • Cataract surgery = 8 readmissions from 2,607 procedures
  • Appendicectomy = 40 readmissions from 796 procedures

If patients experience issues or symptoms following surgery, readmission is often the safest option especially in rural or remote areas where the distance between a patient’s place of residence and access to health services can be considerable. All readmission cases are individually reviewed to ensure appropriate care.

PERCENTAGE OF ELECTIVE WAIT LIST PATIENTS WAITING OVER BOUNDARY FOR REPORTABLE PROCEDURES

Rationale

Elective surgical services delivered in the WA health system are those that can be booked in advance as a result of specialist assessment. These are deemed to be clinically necessary procedures, and potential negative impacts of excessive waiting times for these services include the likelihood of a worsening of the patient’s condition and/or quality of life or even death. Therefore, waiting lists must be actively managed by hospitals to ensure all patients are treated in clinically appropriate timeframes. Patients are prioritised based on their assigned clinical urgency category:

  • Category 1 – procedures that are clinically indicated within 30 days
  • Category 2 – procedures that are clinically indicated within 90 days
  • Category 3 – procedures that are clinically indicated within 365 days

For reportable procedures, the WA health system state wide performance target requires that no patients (0%) on the elective waiting lists wait longer than the clinically recommended time for their procedure, according to their urgency category.

Reportable cases are defined as all waiting list cases that are not listed on the Elective Services Wait List Data Collection (ESWLDC) Commonwealth Non-Reportable Procedure List. This list is consistent with the Australian Institute of Health and Welfare (AIHW) list of Code 2 (other) procedures that do not meet the definition of elective surgery. It is also includes additional procedure codes that are intended to better reflect the procedures identified in the AIHW Code 2 list.

Target

The 2018-19 target is 0% which is aligned to the WA state-wide performance target.

Results

In 2018-19, the percentage of elective wait list patients waiting over boundary for reportable procedures did not meet target in any category (see Table 9).

Table 9: Percentage of elective wait list patients waiting over boundary for reportable procedures

Category2017-18
(%)
2018-19 (%)Target (%)
Category 1 within 30 days 8.7 3.8 0
Category 2 within 90 days 9.4 3.0 0
Category 3 within 365 days 4.8 2.2 0
Total 5.5 2.3 0

WA Country Health Service is progressing a project involving senior clinicians and health administration staff to improve the accuracy and standardisation of referral documentation, and improve the use of business intelligence tools to support the monitoring and management of the elective waiting list. A program of internal audit and compliance assessment has been implemented. There has been improved elective waitlist management by concentrated investment and optimisation of theatre utilisation within regions.

HEALTHCARE-ASSOCIATED STAPHYLOCOCCUS AUREUS BLOODSTREAM INFECTIONS (HA-SABSI) PER 10,000 OCCUPIED BED-DAYS

Rationale

Staphylococcus aureus bloodstream infection is a serious infection that may be associated with the provision of health care. Staphylococcus aureus is a highly pathogenic organism and even with advanced medical care, infection caused by this organism is associated with prolonged hospital stays, increased healthcare costs and a marked increase in morbidity and mortality – mortality estimated at 20-25%.

HA-SABSI is generally considered to be a preventable adverse event associated with the provision of healthcare.

This KPI has been selected for inclusion as it is a robust measure of the safety and quality of WA public hospitals, and aligns to the principle of increased transparency and accountability of performance information provided to the public. A low or decreasing HA-SABSI rate is desirable and a target for WA based on historical data has been set.

Target

The 2018 (calendar year) target is ≤1.0 per 10,000 bed days.

Results

The rate of HA-SABSI Infection per 10,000 occupied bed days met target as seen in Table 10.

Table 10: Healthcare-associated Staphylococcus aureus bloodstream infections (HA-SABSI) per 10,000 occupied bed-days

 2017-18
(per 10,000)
2018-19
(per 10,000)
Target
(per 10,000)
Infection Rate 0.64 0.97 ≤ 1.0

WA Country Health Service participates in the WA Health Healthcare Associated Infection Surveillance in Western Australia Healthcare Facilities (HISWA) program of mandatory surveillance of a range of healthcare associated infections (HAI), including HA-SABSI.

All instances of HA-SABSI are thoroughly investigated to determine the cause of infection. The peak WA Country Health Service infection prevention and control committee maintains a strong focus on HA-SABSI and ensuring WACHS clinical resources are appropriate to reduce their occurrence.

SURVIVAL RATES FOR SENTINEL CONDITIONS

Rationale

This indicator measures performance in relation to restoring the health of people who have suffered a sentinel condition-specifically a stroke, acute myocardial infarction (AMI) or fractured neck of femur (FNOF).

These three conditions have been chosen as they are particularly significant for the healthcare of the community and are leading causes of death and hospitalisation in Australia. Patient survival after being admitted for one of these three sentinel conditions can be affected by many factors including the diagnosis, the treatment given or procedure performed, age, co-morbidities at the time of the admission and complications which may have developed while in hospital. However, survival is more likely when there is early intervention and appropriate care on presentation to an emergency department and on admission to hospital.

By reviewing and analysing survival rates, targeted strategies can be developed that aim to increase patient survival after being admitted for a sentinel condition. Therefore, this indicator can potentially assist hospitals in monitoring changes over time to facilitate effective restoration of patients’ health.

Target

The 2018 (calendar year) targets can be seen in the below table:

Age GroupStroke (%)AMI (%)FNOF (%)
0-49 Years 94.4 99.1 N/A
50-59 Years 93.3 98.9 N/A
60-69 Years 92.9 98.0 N/A
70-79 Years 90.0 96.3 98.7
80+ Years 82.2 91.9 95.3

Results

During 2018, survival rates for stroke met target for all age cohorts (see Table 11). Low number of cases can lead to significant fluctuation in results. Across all age cohorts, WA Country Health Service reported 58 deaths attributed to stroke out of 663 episodes. This is an overall survival rate of 91.3%.

Table 11: Survival rates for sentinel condition: Stroke

Age Group2016 (%)2017 (%)2018 (%)Target (%)
0-49 Years 95.8 100 97.5 ≥94.4
50-59 Years 100 97.0 100 ≥93.3
60-69 Years 92.3 95.9 97.4 ≥92.9
70-79 Years 92.9 96.5 94.6 ≥90.0
80+ Years 84.1 85.2 83.8 ≥82.2

Note: Due to low number of cases within some age categories, care should be taken when considering fluctuations in results.

WA Country Health Service has a standardised clinical care pathway for stroke, developed in line with best practice standards.

Survival rates for Acute Myocardial Infarction (AMI) for 2018 met target performance for all age cohorts (see Table 12). WA Country Health Service reported 13 deaths attributed to AMI out of 504 episodes, representing an overall survival rate of 97.4%.

Table 12: Survival rates for sentinel condition: Acute Myocardial Infarction (AMI)

Age Group2016 (%)2017 (%)2018 (%)Target (%)
0-49 Years 100 100 100 ≥ 99.1
50-59 Years 100 100 100 ≥ 98.9
60-69 Years 94.7 100 98.2 ≥ 98.0
70-79 Years 94.7 96.8 97.9 ≥ 96.3
80+ Years 90.7 90.1 93.2 ≥ 91.9

Note: Due to low number of cases within some age categories, care should be taken when considering fluctuations in results.

WA Country Health Service has a standardised chest pain pathway, designed in line with best practice clinical standards, which promotes sound escalation processes for patients diagnosed as having an acute myocardial infarction.

Survival rates for Fractured Neck of Femur (FNOF) for 2018 also met target performance for all age cohorts (see Table 13). WA Country Health Service reported 3 deaths attributed to FNOF out of 197 episodes, representing an overall survival rate of 98.5%.

Table 13: Survival rates for sentinel condition: Fractured Neck of Femur (FNOF)

Age Group2016 (%)2017 (%)2018 (%)Target (%)
70-79 Years 100 100 100 ≥ 98.7
80+ Years 95.8 96.0 97.8 ≥ 95.3

Note: Due to low number of cases within some age categories, care should be taken when considering fluctuations in results.

WA Country Health Service has developed the draft WA Country Health Service Hip Fracture Clinical Care Practice Guideline to ensure best practice care for patients with a suspected hip fracture who present to a Multi-Purpose Service site or small hospital. The guideline is planned to be published during the course of 2019-20.

Patients presenting with a fractured neck of femur are at greater risk of falling and developing delirium whilst in hospital. WA Country Health Service utilises a standardised Falls Risk Assessment and Management Plan (FRAMP) that guides the screening and assessment of a patient’s risk of falling, and appropriate strategies to reduce the likelihood of a fall. In 2018 WA Country Health Service commenced implementation of a cognitive impairment strategy to increase the awareness of delirium and improve the prevention and management of delirium in at risk patients.

PERCENTAGE OF ADMITTED PATIENTS WHO DISCHARGED AGAINST MEDICAL ADVICE

Rationale

Discharge against medical advice (DAMA) refers to patients leaving hospital against the advice of their treating medical team or without advising hospital staff (i.e. absconding or missing and not found). Patients who DAMA have a higher risk of readmission and mortality and have been found to cost the health system 50% more than patients who are discharged by their physician.

Between July 2013 and June 2015 Aboriginal patients in WA were almost 12.7 times more likely than non-Aboriginal patients to discharge against medical advice, compared with seven times nationally. This statistic indicates a need for improved responses by the health system to the needs of Aboriginal patients.

This indicator provides a measure of the safety and quality of inpatient care. Reporting the results by Aboriginality assists in measuring the effectiveness of initiatives within the WA health system to deliver culturally secure services to Aboriginal people and addressing underlying factors in achieving an equitable treatment outcome for Aboriginal patients compared with non-Aboriginal patients.

Target

The 2018 target is:

a) Aboriginal patients ≤0.77%.

b) Non-Aboriginal patients ≤0.77%

Results

The 2018 Discharge Against Medical Advice (DAMA) rate did not meet target for the Aboriginal cohort, but met target for the Non-Aboriginal cohort (see Table 14).

Table 14: Percentage of admitted patients who discharged against medical advice (DAMA)

Cohort2017 (%)2018 (%)Target (%)
Aboriginal 5.2 4.7 ≤0.77
Non-Aboriginal 0.8 0.6 ≤0.77

WA Country Health Service continues to implement the Discharge Against Medical Advice Policy. All WA Country Health Service regions are developing local strategies to reduce rates of DAMA by Aboriginal people, predominantly focusing on employment of additional Aboriginal Liaison Officers to improve application of policy and procedure to identify at risk patients.

PERCENTAGE OF LIVE-BORN TERM INFANTS WITH AN APGAR SCORE OF LESS THAN 7 AT 5 MINUTES POST DELIVERY

Rationale

This indicator of the condition of newborn infants immediately after birth provides an outcome measure of intrapartum care and newborn resuscitation.

The Apgar score is an assessment of an infant’s health at birth based on breathing, heart rate, colour, muscle tone and reflex irritability. An Apgar score is applied at one, five and (if required by protocol) ten minutes after delivery to determine how well the infant is adapting outside the mother’s womb. Apgar scores range from zero to two for each condition with a maximum final total score of ten. The higher the Apgar score the better the health of the newborn infant.

The outcome measure can lead to the development and delivery of improved care pathways and interventions to improve the health outcomes of Western Australian infants and aligns to the National Core Maternity Indicators (2018) Health, Standard 06/09/2018.

Target

The 2018 target is ≤1.8%.

Results

In 2018, the percentage of live-born term infants with an Apgar score of less than seven, five minutes post-delivery met target, seen in Table 15.

Table 15: Percentage of live-born term infants with an Apgar score of less than 7 at 5 minutes post delivery

 2016 (%)2017 (%)2018 (%)Target(%)
Liveborn Term Infants Apgar <7 at 5 minutes 1.5 1.6 1.4 ≤ 1.8

WA Country Health Service revised the clinical policy for recognising and responding to newborns at risk of acute deterioration in July 2018 informed by an audit by Department of Health Safety and Quality of all WA Health records with low Apgar score at 5 minutes.

WA Country Health Service has revised the clinical policy for electronic fetal heart rate monitoring to add additional components when interpreting and documenting all Cardiotocographs (CTG) to improve identification of hyperstimulation as a contributing cause to poor fetal / newborn outcomes, specifically:

  • Contraction strength, duration, frequency and minimum rest period
  • Escalation triggers for all abnormal CTG parameters

This will increase reliability in correctly interpreting CTGs and minimise the risk of clinical deterioration in newborns.

READMISSIONS TO ACUTE SPECIALISED MENTAL HEALTH INPATIENT SERVICES WITHIN 28 DAYS OF DISCHARGE

Rationale

Readmission rate is considered to be a global performance measure as it potentially points to deficiencies in the functioning of the overall mental healthcare system.

Internationally, readmission rates are often used as a litmus test of the performance of mental health systems. International literature identifies the concept of one month as an appropriate defined time period for the measurement of readmissions following separation from an acute inpatient mental health service. Based on this a timeframe of 28 days for this indicator has been set and endorsed by the AHMAC Mental Health Information Strategy Standing Committee (as at 24 March 2011). It is important to understand that high rates may point to deficiencies in hospital treatment or community follow up care, or a combination of the two. However, other factors may also be implicated in rapid readmissions, with some reflecting the episodic nature of mental illness.

This indicator is reported at the facility at which the initial admission occurred rather than the facility at which the patient was readmitted. By measuring and monitoring this indicator, key areas for improvement can be identified. This in turn can facilitate the development and delivery of targeted care pathways and interventions, which aim to improve mental health and quality of life of Western Australians.

Target

The 2018 target is ≤12%.

Results

In 2018, the rate of total readmissions within 28 days to an acute designated mental health inpatient unit did not meet target (see Table 16).

Table 16: Rate of readmissions to acute specialised mental health inpatient services within 28 days of discharge

 2017 (%)2018 (%)Target (%)
Total Hospital Readmissions 17.2 19.4 ≤ 12

In the 2018-19 year the data definition of this indicator was amended following changes in the national mental health data definitions. The previously published 2017 result of 17.2% has been restated above under the new definitions to support comparability.

WA Country Health Service has identified that due to limited options and access to other primary or secondary care service providers and supported step down or sub -acute accommodation in rural and remote WA, readmissions may be in the only option for some patients. Analysis of readmissions for this period have identified the cohort of people needing re-admission are often people with an Emotionally Unstable Personality Disorder (also known as borderline personality disorder) and people affected by substance misuse and have complex social problems. These people experience repeated crises and are encouraged to return to Emergency Departments and receive short term re-admissions prior to the emotional crises escalating (which may otherwise result in increased self-harming behaviours).

WA Country Health Service Mental Health ensures that readmissions are monitored closely and occur where clinically appropriate and not as the first solution. Intensive post discharge follow up continues to be offered to patients however re-admission will occur for highly complex patients, including those with a mood disorder and co-morbid substance misuse.

PERCENTAGE OF POST DISCHARGE COMMUNITY CARE WITHIN 7 DAYS FOLLOWING DISCHARGE FROM ACUTE SPECIALISED MENTAL HEALTH INPATIENT SERVICES

Rationale

In 2014-15 there were 4.0 million Australians (17.5%) who reported having a mental or behavioural condition. Therefore, it is crucial to ensure effective and appropriate care is provided not only in a hospital setting but also in the community.

Discharge from hospital is a critical transition point in the delivery of mental health care. People leaving hospital after an admission for an episode of mental health illness have heightened levels of vulnerability and, without adequate follow up, may relapse or be readmitted. This KPI measures the performance of the overall health system in providing continuity of mental health care.

A responsive community support system for persons who have experienced a psychiatric episode requiring hospitalisation is essential to maintain their clinical and functional stability and to minimise the need for hospital readmissions. Patients leaving hospital after a psychiatric admission with a formal discharge plan, involving linkages with public community based services and support, are less likely to need avoidable readmission.

The standard underlying the measure is that continuity of care involves prompt community follow-up in the vulnerable period following discharge from hospital. Overall, the variation in post-discharge follow-up rates suggest important differences between mental health systems in terms of their practices.

Target

The 2018 target is ≥75%.

Results

In 2018, contacts with community-based public mental health non-admitted services within seven days post discharge from an acute public mental health inpatient unit met target (see Table 17).

Table 17: Percentage of post discharge community care within 7 days following discharge from acute specialised mental health inpatient services

 2016 (%)2017 (%)2018 (%)Target(%)
Post-discharge community-based
contacts
67.5 75.6 79.1 ≥75

Throughout the last twelve months the WA Country Health Service regions have consistently met the target of 75 per cent. Improved communication between the Mental Health Inpatient Units and the Community Mental Health teams has contributed to increased rates of follow up. The Mental Health services attempt to follow up all patients discharged but not all patients can be contacted within the seven day time frame. Patients may be difficult to contact for various reasons. Some patients when discharged do not want further contact and refuse to engage with the Mental Health Service. Others may decline to attend or not show up for appointments. Consumers may be lost to the service, not contactable or may have moved out of the area.

Outcome 1: Efficiency indicators

AVERAGE ADMITTED COST PER WEIGHTED ACTIVITY UNIT

Rationale

This indicator is a measure of the cost per weighted activity unit compared with the state (aggregated) target, as approved by the Department of Treasury and published in the 2018-19 Budget Paper No. 2, Volume 1.

The measure ensures a consistent methodology is applied to calculating and reporting the cost of delivering inpatient activity against the state’s funding allocation. As admitted services received nearly half of the overall 2018-19 budget allocation, it is imperative that efficiency of this service delivery is accurately monitored and reported.

Target

The 2018-19 target is $6,948 per weighted activity unit.

Results

In 2018-19, the average admitted cost per weighted activity unit (WAU) met target, as can be seen in Table 18.

Table 18: Average admitted cost per weighted activity unit (WAU)

 2017-18 ($)2018-19 ($)Target ($)
Average admitted cost / WAU $6,119 $6,342 $6,948

WA Country Health Service inpatient activity is generally less acute and specialised, as more complex patients are typically referred to metropolitan health services. This results in a lower cost per WAU result for inpatient activity.

AVERAGE EMERGENCY DEPARTMENT COST PER WEIGHTED ACTIVITY UNIT

Rationale

This indicator is a measure of the cost per WAU compared with the state (aggregated) target as approved by the Department of Treasury, which is published in the 2018-19 Budget Paper No. 2, Volume 1.

The measure ensures that a consistent methodology is applied to calculating and reporting the cost of delivering ED activity against the state’s funding allocation. With the increasing demand on EDs and health services, it is imperative that ED service provision is monitored to ensure the efficient delivery of safe and high-quality care.

Target

The 2018-19 target is $7,072 per weighted activity unit.

Results

In 2018-19, the average emergency department cost per weighted activity unit (WAU) met target, as seen in Table 19.

Table 19: Average Emergency Department (ED) cost per weighted activity unit (WAU)

 2017-18 ($)2018-19 ($)Target ($)
Average ED cost / WAU $7,292 $6,753 $7,072

In 2018-19 Emergency Department weighted activity units increased as a result of changes to the Activity-Based Funding Framework which increased the recognition of WAUs for patients from remote and very remote areas. This contributed to a decrease in Average ED cost per WAU.

AVERAGE NON-ADMITTED COST PER WEIGHTED ACTIVITY UNIT

Rationale

The indicator is a measure of the cost per WAU compared with the state (aggregated) target, as approved by the Department of Treasury, which is published in the 2018-19 Budget Paper No. 2, Volume 1.

The measure ensures that a consistent methodology is applied to calculating and reporting the cost of delivering non-admitted activity against the state’s funding allocation. Non-admitted services play a pivotal role within the spectrum of care provided to the WA public, therefore it is imperative that non-admitted service provision is monitored to ensure the efficient delivery of safe and high-quality care.

Target

The 2018-19 target is $7,136 per weighted activity unit.

Results

In 2018-19, the average non-admitted cost per weighted activity unit (WAU) met target (see Table 20).

Table 20: Average Non-Admitted cost per weighted activity unit (WAU)

 2017-18 ($)2018-19 ($)Target ($)
Average Non-Admitted cost / WAU $6,035 $5,828 $7,136

Outpatient activity is predominately allied health and nursing services, with less specialist outpatient services, resulting in a lower cost per WAU.

AVERAGE COST PER BED-DAY IN SPECIALISED MENTAL HEALTH INPATIENT SERVICES

Rationale

Specialised mental health inpatient services provide patient care in authorised hospitals and designated mental health units located within hospitals. In order to ensure quality of care and cost effectiveness, it is important to monitor the unit cost of admitted patient care in specialised mental health inpatient services. The efficient use of hospital resources can help minimise the overall costs of providing mental health care and enable the reallocation of funds to appropriate alternative non-admitted care.

Target

The 2018-19 target is $1,630 per bed-day.

Results

In 2018-19, average cost per bed-day in specialised mental health inpatient services did not meet target, as seen in Table 21.

Table 21: Average cost per bed-day in specialised mental health inpatient services

 2016-17 ($)2017-18 ($)2018-19 ($)Target ($)
Average cost / bed-day in
specialised mental health
inpatient unit
$2,186 $1,728 $1,669 $1,630

AVERAGE COST PER TREATMENT DAY OF NON-ADMITTED CARE PROVIDED BY MENTAL HEALTH SERVICES

Rationale

Public community mental health services consist of a range of community-based services such as emergency assessment and treatment, case management, day programs, rehabilitation, psychosocial, residential services and continuing care. The aim of these services is to provide the best health outcomes for the individual through the provision of accessible and appropriate community mental health care. Efficient functioning of public community mental health services is critical to ensure that finite funds are used effectively to deliver maximum community benefit.

Public community-based mental health services are generally targeted towards people in the acute phase of a mental illness who are receiving post-acute care. This indicator provides a measure of the cost effectiveness of treatment for public psychiatric patients under public community mental healthcare (non-admitted/ambulatory patients).

Target

The 2018-19 target is $546 per treatment day.

Results

In 2018-19, WA Country Health Service average cost per treatment day of non-admitted care provided by mental health services did not meet the target as can be seen in Table 22.

Table 22: Average cost per treatment day of non-admitted care provided by mental health services

 2017-18 ($)2018-19 ($)Target ($)
Average cost / treatment day of non-admitted care provided by mental health services $591 $570 $546

Outcome 1 - Efficiency indicators

RESPONSE TIMES FOR EMERGENCY AIR-BASED PATIENT TRANSPORT SERVICES (PERCENTAGE OF EMERGENCY AIR-BASED INTER-HOSPITAL TRANSFER MEETING THE STATEWIDE CONTRACT TARGET RESPONSE TIME FOR PRIORITY 1 CALLS)

Rationale

To ensure Western Australians receive the care and medical transport services they need, when they need it, WA Country Health Service has entered into a contractual relationship to deliver emergency air-based patient transport services to the WA public. This collaboration ensures that patients have access to an effective aeromedical and inter-hospital patient transfer service to ensure the best possible health outcomes for patients requiring urgent medical treatment through rapid response.

Response times for patient transport services have a direct impact on the speed with which a patient receives appropriate medical care and provide a good indication of the efficiency and effectiveness of patient transport services. Adverse effects on patients and the community are reduced if response times are reduced.

Calls are assigned a priority (1 to 3) by the service provider, to ensure that conflicting flight requests are dealt with in order of medical need and to allow operations coordinators to task aircraft and crews in the most efficient means possible to meet these needs. The priority system in place is as follows:

  • Priority 1 refers to life-threatening emergencies, where the flight departs in the shortest possible time (subject to weather and essential safety requirements).
  • Priority 2 refers to urgent medical transfer, where the flight departs promptly with flight planning requirements met on the ground.
  • Priority 3 refers to elective transfer, where flight tasked to make best use of resources and crew hours.

Through surveillance of this measure over time, the effectiveness of patient transport services can be determined. This facilitates further development of targeted strategies and improvements to operational management practices aimed at ensuring optimal restoration to health for patients in need of urgent medical care.

Target

The 2018-19 target is ≥80%.

Results

In 2018-19, WA Country Health Service met the target as can be seen in Table 23.

Table 23: Response times for emergency air-based patient transport services

 2017-18 (%)2018-19 (%)Target (%)
Response times for priority 1 calls 78.9% 81.8% ≥80%

Outcome 2 - Effectiveness indicators

PERCENTAGE OF PATIENTS WHO ACCESS EMERGENCY SERVICES AT A SMALL RURAL OR REMOTE WESTERN AUSTRALIAN HOSPITAL AND ARE SUBSEQUENTLY  DISCHARGED HOME

Rationale

Small country hospitals provide emergency care services, residential aged care services and limited acute medical and minor surgical services in locations close to home for country residents and the many visitors to the regions.
This measure indicates whether small rural and remote hospital emergency services provide the level of care required to meet the needs of the community. Utilising health services with the outcome of returning home (where clinically justified) is indicative of effective service delivery.

Target

The 2018-19 target is 92.2%.

Results

In 2018-19, WA Country Health Service did not meet the target as can be seen in Table 24.

Table 24: Percentage of patients who access emergency services at a small rural or remote WA hospital and are subsequently discharged home

 2017-18 (%)2018-19 (%)Target (%)
Percentage of patients discharged home 84.5 84.7 92.2

Increases in admissions and transfers to other health services from small hospitals occurred in 2018-19, contributing to the lower than target result. The health needs of the patient are the top priority in any decision on treatment location. The previously published 2017-18 result of 90.4% has been restated after review of the indicator definition and its application.

Outcome 2 - Efficiency indicators

AVERAGE COST PER BED-DAY FOR SPECIALISED RESIDENTIAL CARE FACILITIES, FLEXIBLE CARE (HOSTELS) AND NURSING HOME TYPE RESIDENTS

Rationale

The WA Country Health Service provides long-term care facilities for rural patients requiring 24 hour nursing care. This healthcare service is delivered to high and low dependency residents in nursing homes, hospitals, hostels and flexible care facilities, and constitutes a significant proportion of the activity within WA Country Health Service jurisdictions where access to non-government alternatives is limited.

Target

The 2018-19 Target is $294.

Results

In 2018-19 average cost per bed-day for specialised residential care facilities, flexible care (hostels) and nursing home type residents did not meet target, as shown in Table 25.

Table 25: Average cost per bed-day for specialised residential care facilities, flexible care (hostels) and nursing home type residents

 2016-17 ($)2017-18 ($)2018-19 ($)Target ($)
Average cost per bed-day $526 $557 $538 $294

Performance in this indicator can be variable based on demand for aged care residential placements. There is a community expectation that residential aged care facilities operated by the WA Country Health Service will remain open and maintained, regardless of occupancy.

AVERAGE COST PER PERSON OF DELIVERING POPULATION HEALTH PROGRAMS BY POPULATION HEALTH UNITS

Rationale

Population health units support individuals, families and communities to increase control over and improve their health.
With the aim of improving health, population health works to integrate all activities of the health sector and link them with broader social and economic services and resources by utilising the WA Health Promotion Strategic Framework 2017–2021. This is based on the growing understanding of the social, cultural and economic factors that contribute to a person’s health status.

Target

The 2018-19 Target for WA Country Health Service is $228.

Results

In 2018-19, average cost per person of delivering population health programs by population health units did not meet target as per Table 26.

Table 26: Average cost per person of delivering population health programs by population health units

 2016-17 ($)2017-18 ($)2018-19 ($)Target ($)
Average cost per person for  population health $294 $273 $291 $228

Population Health comprises health promotion, primary care, education and research. Rural and remote population estimates used in this KPI have been revised down for 2018-19, contributing to a higher average cost per person. The previously published result for 2017-18 ($374) has been restated following refinement to Outcomes Based Management (OBM) cost allocations.

COST PER TRIP OF PATIENT EMERGENCY AIR-BASED TRANSPORT, BASED ON THE TOTAL ACCRUED COSTS OF THESE SERVICES PER THE TOTAL NUMBER OF TRIPS

Rationale

To ensure Western Australians receive the care they need, when they need it, strong partnerships have been forged within the healthcare community through a collaborative agreement between the WA Country Health Service and the contracted service provider. This collaboration ensures that patients in rural and remote areas have access to an effective emergency air-based transport service that aims to ensure the best possible health outcomes for country patients requiring urgent medical treatment and transport services.

Target

The 2018-19 Target is $7,244.

Results

In 2018-19, the cost per trip of patient emergency air-based transport based on the total accrued costs of these services per the total number of trips met the target, as seen in Table 27.

Table 27: Cost per trip of patient emergency air-based transport, based on the total accrued costs of these services per the total number of trips

 2017-18 ($)2018-19 ($)Target ($)
Cost per trip of emergency air-based transport $7,121 $7,049 $7,244

AVERAGE COST PER TRIP OF PATIENT ASSISTED TRAVEL SCHEME (PATS)

Rationale

The WA health system aims to provide safe, high-quality healthcare to ensure healthier, longer, and better quality lives for all Western Australians.

The Patient Assisted Travel Scheme (PATS) provides a subsidy towards the cost of travel and accommodation for eligible patients travelling long distances to seek certain categories of specialised medical services. The aim of PATS is to help ensure that all Western Australians can access safe, high-quality healthcare when needed.

Target

The 2018-19 Target is $431.

Results

In 2018-19 the average cost per trip of Patient Assisted Travel Scheme (PATS) did not meet target, as per Table 28.

Table 28: Average cost per trip of Patient Assisted Travel Scheme (PATS)

 2016-17 ($)2017-18 ($)2018-19 ($)Target ($)
Average Cost per trip of PATS $438 $440 $446 $431

AVERAGE COST PER RURAL AND REMOTE POPULATION (SELECTED SMALL RURAL HOSPITALS)

Rationale

The WA health system aims to provide safe, high-quality healthcare to ensure healthier, longer and better quality lives for all Western Australians.

The Independent Hospital Pricing Authority’s (IHPA) key role is to determine the annual National Efficient Price (NEP) and National Efficient Cost (NEC) for Australian public hospital services. The NEC is used when activity levels are not sufficient for funding based on activity, such as in the case of small rural hospitals. In these cases, services are funded by a block allocation based on size and location. Public hospitals are block funded where there is an absence of economies of scale that mean some services would not be financially viable under Activity Based Funding.

Small rural hospitals provide an essential level of access to services for rural and remote communities. These hospitals have relatively low patient activity and have high fixed costs therefore it is appropriate to measure efficiency based on population numbers as opposed to unit of patient activity.

In the calculation of this indicator, ‘rural and remote’ population has been calculated using the total WA Country Health Service population.

Target

The 2018-19 Target is $369.

Results

In 2018-19, average cost per rural and remote population (selected small rural hospitals) did not meet target (see Table 29).

Table 29: Average cost per rural and remote population (selected small rural hospitals)

 2017-18 ($)2018-19 ($)Target ($)
Average cost per rural and remote population $401 $455 $369

Rural and remote population estimates used in this KPI have been revised down for 2018-19, contributing to a higher average cost per population. WA Country Health Service is committed to providing safe and sustainable small hospital services across Western Australia.

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Ministerial directives

Treasurer’s Instruction 903 (12) requires disclosing information about Ministerial directives relevant to the setting of desired outcomes or operational objectives, the achievement of desired outcomes or operational objectives, investment activities and financial activities.

The WA Country Health Service did not receive any Ministerial directives related to this requirement.

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Summary of Board and committee remuneration

The total annual remuneration for each Board or committee is listed below in Table 30. For details of in
dividual Board or committee members, please refer to Appendix 2.

Table 30: Summary of State Government Boards and committees within the WA County Health Service in 2018-19

Board/committee nameTotal remuneration
WA Country Health Service Board $428,203
SUB TOTAL $428,203
WA Country Health Service Human Research Ethics Committee $12,300
SUB TOTAL $12,300
Medical Advisory Committees
Albany Hospital Medical Advisory Committee $0
Blackwood Hospital Medical Advisory Committee $994
Bunbury Hospital Medical Advisory Committee $1,440
Busselton Hospital Medical Advisory Committee $1,734
Canarvon Medical Advisory Committee $0
Central Great Southern Medical Advisory Committee $2,640
Denmark Medical Advisory Committee $990
Donnybrook Hospital Medical Advisory Committee $0
Eastern Wheatbelt Medical Advisory Committee $2,276
Esperance Medical Advisory Committee $4,310
Exmouth Medical Advisory Committee $0
Geraldton Medical Advisory Committee $0
Margaret River Medical Advisory Committee $603
Pilbara Medical Advisory Committee $0
Plantagenet-Cranbrook Medical Advisory Committee $1,100
Southern District Medical Advisory Committee $0
Warren District Hospital Medical Advisory Committee $2,045
Western Wheatbelt Medical Advisory Committee $0
SUB TOTAL $18,132
District Health Advisory Councils
Blackwood District Health Advisory Council $970
Broome District Health Advisory Council $0
Bunbury District Health Advisory Council $480
Central Great Southern District Health Advisory Council $2160
Derby District Health Advisory Council $0
East Pilbara District Health Advisory Council $570
Eastern District Health Advisory Council (Wheatbelt) $810
Gascoyne District Health Advisory Council $280
Geraldton District Health Advisory Council $740
Kununurra/Wyndham and surrounding communities District Health Advisory Council (East Kimberley) $3059
Leschenault District Health Advisory Council $480
Lower Great Southern District Health Advisory Council $420
Midwest District Health Advisory Council $1690
Naturaliste District Health Advisory Council $0
Northern Goldfields District Health Advisory Council (Kalgoorlie) $6,230
Southern Goldfields District Health Advisory Council (Esperance) $0
Southern Wheatbelt District Health Advisory Council $0
Warren District Health Advisory Council (Wheatbelt) $0
West Pilbara District Health Advisory Council $0
Western Wheatbelt District Health Advisory Council $3880
SUB TOTAL $21,769
TOTAL $480,404

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Other financial disclosures

PRICING POLICY

The National Health Reform Agreement sets the policy framework for the charging of public hospital fees and charges. Under the Agreement, an eligible person who receives public hospital services as a public patient in a public hospital or a publicly contracted bed in a private hospital is treated ‘free of charge’. This arrangement is consistent with the Medicare principles which are embedded in the Health Services Act 2016 (WA).

The majority of hospital fees and charges for public hospitals are set under Schedule 1 of the Health Services (Fees and Charges) Order 2016 and are reviewed annually. The following informs WA public hospital patients fees and charges for:

Nursing Home Type Patients

The State charges public patients who require nursing care and/or accommodation after the 35th day of their stay in hospital, providing they no longer need acute care and they are deemed to be Nursing Home Type Patients. The total daily amount charged is no greater than 87.5 per cent of the current daily rate of the single aged pension and the maximum daily rate of rental assistance.

Compensable or ineligible patients

Patients who are either ‘private’ or ‘compensable’ and Medicare ineligible (overseas residents) may be charged an amount for public hospital services as determined by the State. The setting of compensable and ineligible hospital accommodation fees is set close to, or at, full cost recovery.

Private patients (Medicare eligible Australian residents)

The Commonwealth Department of Health regulates the Minimum Benefit payable by health funds to privately insured patients for private shared ward and same day accommodation. The Commonwealth also regulates the Nursing Home Type Patient ‘contribution’ based on March and September pension increases. To achieve consistency with the Commonwealth Private Health Insurance Act 2007, the State sets these fees at a level equivalent to the Commonwealth Minimum Benefit.

Veterans

Hospital charges of eligible war service veterans are determined under a separate Commonwealth-State agreement with the Department of Veterans’ Affairs. Under this agreement, the Department of Health does not charge medical treatment to eligible war service veteran patients, instead medical charges are fully recouped from the Department of Veterans’ Affairs.

The following fees and charges also apply:

  • The Pharmaceutical Benefits Scheme regulates and sets the price of pharmaceuticals supplied to outpatients, patients on discharge and for day admitted chemotherapy patients. Inpatient medications are supplied free of charge.
  • The Dental Health Service charges to eligible patients for dental treatment are based on the Department of Veterans’ Affairs Fee Schedule of dental services for dentists and dental specialists. Eligible patients are charged the following co-payment rates:
    • 50 per cent of the treatment fee if the patient holds a current Health Care Card or Pensioner Concession Card
    • 25 per cent of the treatment fee if the patient is the current holder of one of the above cards and receives a near full pension or an allowance from Centrelink or the Department of Veterans’ Affairs

There are other categories of fees specified under Health Regulations through Determinations, which include the supply of surgically implanted prostheses, Magnetic Resource Imaging services and pathology services. The pricing for these hospital services is determined according to their cost of service.

CAPITAL WORKS

Completed

Table 31: Capital works completed in 2018-19

Project NameEstimated Total Cost in 2018–19 ($‘000)
Albany Hospice Carpark 659
Bunbury, Narrogin and Collie Hospital - Pathology 6,665
Country Staff Accommodation - Stage 3 27,408
Digital Innovation 5,252
East Kimberley Development Package 38,607
Government Office Accommodation Reform Program
-  Bennett Street
660
Kalgoorlie Regional Resource Centre 57,230
Strengthening Cancer Services in Regional Western Australia
- Geraldton Cancer Centre
3,768
Strengthening Cancer Services in Regional Western Australia
- Narrogin Cancer Centre
2,000
Country Staff Accommodation - Stage 4 8,124

[Photo (PDF only): Artist Kyle Hughes Odgers paints his mural “Efflorescence” at the new Karratha Health Campus.]

CAPITAL WORKS (cont.)

In Progress

Table 32: Capital works in progress in 2018-19

Project NameEstimated Total Cost in 2018-19 ($’000)Reported in 2017-18 ($’000)Variance ($’000)Expected Completion Date2017-18 and 2018-19 variation to cost explanation (>=10%)
Broome Regional Resource Centre - Redevelopment Stage 41,811 42,000 -189 Completed  
Busselton Health Campus ⁴ 114,983 115,202 -219 Completed  
Carnarvon Aged Care ² 16,577 11,577 5,000 Aug-21 See footnotes
Carnarvon Health Campus Redevelopment ⁴ 25,282 25,666 -384 Completed  
Country Transport Initiatives¹ 1,760 3,228 -1,468 Various See footnotes
District Hospital Investment Program ²,⁴ 160,004 163,743 -3,739 Various  
Derby Community Health Service ⁴ 3,672 3,700 -28 Nov-21  
Eastern Wheatbelt District (Including Merredin) Stage 1 7,881 7,881   Completed  
Esperance Health Campus Redevelopment ¹,⁴ 31,848 31,871 -23 Completed  
Geraldton Health Campus Redevelopment 73,336 not available   Mid-23  
Harvey Health Campus Redevelopment ⁴ 12,410 12,858 -448 Completed  
Hedland Regional Resource Centre - Stage 2 ⁴ 136,237 136,215 22 Completed  
Karratha Health Campus - Development ¹,²,⁴ 173,118 207,131 -34,013 Completed See footnotes
Narrogin Helipad 800 not available   Completed  
Newman Health Service Redevelopment ⁴ 47,427 47,433 -6 May-20  
Nickol Bay Hospital Demolition 7,760 not available   Dec-19  
Onslow Health Service Redevelopment ², ⁴ 36,409 41,723 -5,314 Completed  
Primary Health Centres ²,⁴ 32,331 32,659 -328 Various  
Remote Indigenous Health ⁴ 24,168 24,053 115 Various  
Renal Dialysis and Support Services ⁴ 44,269 46,796 -2,527 Various  
Renal Dialysis 1,950 1,950   Completed  
Small Hospitals & Nursing Posts ²,⁴ 95,969 102,444 -6,475 Various  
Strengthening Cancer Services - Geraldton Cancer Centre 3,930 3,930   Completed  
Strengthening Cancer Services - Northam Cancer Centre 3,500 3,500   Completed  
Strengthening Cancer Services - Regional Cancer Patient Accommodation ⁴ 4,430 4,392 38 Various  
Tom Price Hospital Redevelopment 5,250 5,250   N/A WACHS seeking additional funds to undertake required scope.
Upper Great Southern District (including Narrogin) Stage 1 10,497 10,497   Completed  
WA Country Health Service Picture Archive Communication System - Regional Resource Centre ⁴ 6,233 6,273 -40 Completed  

Notes:

(a) The above information is based upon the:

  1. 2019-20 published budget papers
  2. 2. 2017-18 published budget papers.

(b) Completion timeframes are based upon a combination of known dates at the time of reporting.
(c) Projects listed above as ‘completed’ may still be in the defects period.
(d) The footnotes that apply to individual projects are:

  1. Transfer of funding between projects.
  2. Royalties for Regions Funding changes.
  3. Impacted as part of Whole of Government Capital Audit.
  4. Excludes amounts that will not be capitalised, therefore the ETC may vary from that reported in the 2018/19 Budget.

EMPLOYMENT PROFILE

Government agencies are required to report a summary of the number of employees by category compared with the preceding financial year. Table 33 shows the year-to-date (June 2019) number of WA Country Health Service full-time equivalent employees for 2017–18 and 2018-19.

Table 33: WA Country Health Service total full-time employees by category

CategoryDefinition2017-182018-19
Administration and clerical Includes all clerical-based occupations together with patient-facing (ward) clerical support staff. 1,633 1,687
Agency Includes full-time equivalent employees associated with the following occupational categories: administration and clerical, medical support, hotel services, site services, medical salaried (excludes visiting medical practitioners) and medical sessional. 127 159
Agency nursing Includes workers engaged on a ‘contract for service’ basis. Does not include workers employed by NurseWest. 142 154
Assistants in nursing Support registered nurses and enrolled nurses in delivery of general patient care. 73 77
Dental nursing Includes registered dental nurses and dental clinic assistants. 0 0
Hotel services Includes catering, cleaning, stores/supply, laundry and transport occupations. 1,226 1,229
Medical salaried Includes all salary-based medical occupations including interns, registrars and specialist medical practitioners. 429 448
Medical sessional* Includes specialist medical practitioners that are engaged on a sessional basis. 13 0
Medical support Includes all allied health and scientific/ technical related occupations. 851 900
Nursing Includes all nursing occupations. Does not include agency nurses. 2,990 3,073
Site services Includes engineering, garden and security-based occupations. 155 157
Other categories Includes Aboriginal and ethnic health worker related occupations. 133 140
TOTAL   7,772 8,024
  1. Data Source: HR Data Warehouse.
  2. FTE is calculated as the monthly average FTE and is the average hours worked during a period of time divided by the Award Full Time Hours for the same period. Hours include ordinary time, overtime, all leave categories, public holidays, Time Off in Lieu and Workers Compensation.
  3. FTE figures provided are based on Actual (Paid) month to date FTE.
  4. Medical sessional* staff are now coded under Medical salaried as part of a WA Health wide system change

STAFF DEVELOPMENT

The WA Health Recruitment, Selection and Appointment Policy and Procedure is contained within the WA Health Employment Framework and provides the requirements and standard processes specific to recruitment, selection and appointment, secondment, transfer and temporary deployment (acting) in WA Health, in accordance with the relevant Western Australian public sector standards and/or legislative requirements.

The Commissioner’s Instruction No. 1 Employment Standard and the Commissioner’s Instruction No. 2 Filling a Public Sector Vacancy establishes the minimum standards of merit, equity, and probity that must be applied when filling a vacancy. WA Country Health Service is committed to ensuring the timely recruitment of skilled candidates to vacancies in regional areas.

WA Country Health Service is committed to building a strong, skilled and growing Aboriginal health workforce across all levels in the organisation. A key strategy to increase the Aboriginal workforce in the WA health system is through the application of Section 51 (s.51) of the Equal Opportunity Act (1984).

WA Country Health Service provides a learning and development framework that ensures the delivery of safe, high quality and consumer-centred care services. This is achieved by supporting and facilitating learning programs that enables the development and maintenance of professional skills. Ongoing skills development and learning assists us to attract and retain a competent workforce that is aligned with service needs. To assist the workforce in understanding their role specific mandatory training requirements, a Learning Framework structure is in place across the organisation. The Framework areas include Nursing and Midwifery, Medical Services, Healthcare Support staff, Managers, Allied Health and Emergency Management roles. The use of a consistent Learning Management System enables an organisation wide governance approach to the management, publication and reporting of mandatory training and development. Enhancement to governance practices ensures cost effective delivery of training of programs.

The WA Country Health Service continues to expand its use of the innovative State-wide Telehealth Service and Emergency Telehealth Service to provide staff in regional and remote locations access to metropolitan specialists delivering training to support clinical skills development.

INDUSTRIAL RELATIONS

Responsibility for industrial relations is delineated by an Industrial Relations Policy MP 0025/16 established under the Employment Policy Framework issued by the System Manager (the Chief Executive Officer of the Department of Health) pursuant to section 26 of the Health Services Act 2016.

The Department of Health as System Manager is responsible for WA health system-wide industrial relations matters including negotiation and registration of industrial instruments. WA Country Health Service is responsible for the application of the WA Public Sector legislative and regulatory frameworks regulating employment and industrial relations, management of misconduct matters, representation and advocacy in industrial tribunals and courts, engagement with unions and other external stakeholders in industrial matters.

New industrial agreements for engineering and building trades, hospital salaried officers and registered nurses were negotiated and finalised. In-principle agreement reached for enrolled nurses during the 2018-19 financial year, with the agreement registered in July 2019. There was no significant industrial disputation in the year under review.

GOVERNMENT BUILDING CONTRACTS

The Government Building Training Policy aims to increase the number of apprentices and trainees in the building and construction industry. It is applied by requiring contractors awarded State Government building, construction and maintenance contracts with an estimated labour value over $2M to commit to meeting a target training rate, through employing construction apprentices and trainees.

WA Health Works Procurement Policy stipulates that all works over $2 million are coordinated by the Department of Finance, Building Management and Works (BMW). BMW reports compliance with the Government building training policy in their annual report.

The State Government’s Priority Start policy replaced the Government Building Training policy on 1 April 2019. No new contracts have been awarded under the new policy for the 2018-19 Financial Year and contractors who are currently reporting under the existing training policy will transition to the new policy from 1 July 2019.

WORKERS COMPENSATION

The WA Workers’ Compensation system is a scheme established by the State Government and exists under the statute of the Workers’ Compensation and Injury Management Act 1981.

A review of the WA Country Health Service injury management system has commenced, to ensure claims are managed efficiently and workers are fully supported to return to productive duties as soon as medically appropriate. This approach, including an early intervention aims to result optimal claim outcomes for the injured worker and the organisation.

In 2018-19, a total of 248 workers’ compensation claims were made (see Table 34).

Table 34: Number of WA Country Health Service workers’ compensation claims in 2018-19

Employee categoryNumber of claims in 2018-19
Nursing Services/Dental Care Assistants 85
Administration and Clerical 31
Medical Support 20
Hotel Services 91
Medical (salaried) 1
Site Services 20
Total 248

Note: For the purposes of the Annual Report, Employee categories are defined as:

  • administration and clerical – includes administration staff and executives, ward clerks, receptionists and clerical staff
  • medical support – includes physiotherapists, speech pathologists, medical imaging technologists, pharmacists, occupational therapists, dieticians and social workers
  • hotel services – includes cleaners, caterers, and patient service assistants
  • site services – includes handypersons, security officers, store people and electricians.


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Governance disclosures

CONTRACTS WITH SENIOR OFFICERS

At the date of reporting, no senior officer or Board member, or firms of which senior officers or Board members are members, or entities in which senior officers or Board members have substantial interest, had any interests in existing or proposed contracts with the WA Country Health Service other than normal contracts of employment service.

UNAUTHORISED USE OF CREDIT CARDS

WA Country Health Service uses Purchasing Cards for purchasing goods and services to achieve savings through improved administrative efficiency and more effective cash management. The Purchasing Card is a personalised credit card that provides a clear audit trail for management.

WA Country Health Service credit cards are provided to employees who require it as part of their role. Credit cards are not for personal use by the cardholder. Should a cardholder use a credit card for personal purposes, they are required to submit a Notice of Non-Compliance (Form 625-3) to the accountable authority within five working days of becoming aware of the transaction and refund the total amount of expenditure.

There were 34 transactions in the period where credit cards were inadvertently used for personal purposes. All transactions were refunded before the end of the reporting period, except for one transaction for $5.18 which was refunded on 3 July 2019.

Table 35: Credit card personal use expenditure in 2018-19

Credit card personal use expenditure1 July 2018 to
30 June 2019
Aggregate amount of personal use expenditure for the reporting period $3,781.68
Aggregate amount of personal use expenditure settled
by the due date (within five working days)
$3,022.13
Aggregate amount of personal use expenditure
settled after the period (after five working days)
$754.37
Aggregate amount of personal use expenditure outstanding at the end of the reporting period. $5.18

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Other legal disclosures

ANNUAL ESTIMATES

In accordance with Section 40 of the Financial Management Act 2006, the WA Country Health Service has submitted Annual Estimates to the Minister at an appropriate time during the financial year, as determined by the Treasurer.

ADVERTISING

In accordance with section 175Z of the Electoral Act 1907, WA Country Health Service incurred a total advertising expenditure of $48,821.82 in 2018-19 (see Table 36). There was no expenditure in relation to advertising agencies, polling or direct mail organisations.

Table 36: Summary of WA Country Health Service advertising for 2018-19

Summary of advertisingAmount ($)
Advertising agencies $0
Market research organisations $0
Polling organisations $0
Direct mail organisations $0
Media advertising organisations $0
Total advertising expenditure $0

The organisations that provided advertising services and the amount paid to each are detailed in Table 37

Table 37: Organisations that provided advertising services

Person, agency or organisation nameAmount ($)
Advertising agencies $0
Market research organisations $0
Polling organisations $0
Direct mail organisations $0
Media advertising organisations
Adcorp Australia Ltd
$10,075.73
Australasian College of Emergency Medicine $2,750.00
Conference Design Pty Ltd $2,909.09
Health Communication Resources $6,983.00
Initiative Media Australia Pty Ltd $2,994.90
Royal Australian and New Zealand College of Psychiatry $3,497.73
Seabreeze Communications $4,480.00
Total $48,821.82

Note: Values of less than $2,500 are not listed although the amount is included in the total.

DISABILITY ACCESS AND INCLUSION PLAN

Our Disability Access and Inclusion Plan 2015-2020 was developed in consultation with our consumers, staff and key stakeholders to provide strategies for the WA Country Health Service to support increased independence, opportunities and inclusion for people with disability.

The plan outlines our priorities over a five-year period and builds upon our past achievements. WA Country Health Service continues to meet our commitment to ensuring that people with disability have the same opportunities to fully access the range of health services, facilities and information available in the public health system, and to participate in public consultation. Amongst a range of inclusion activities, we do this by:

  • ensuring that all capital works projects comply with the minimum access, egress and amenity levels set out in the Building Code of Australia, and all infrastructure improvements and redevelopments are undertaken with a view to universal access.
  • providing information to staff who are arranging events that will ensure that events are accessible to people with disabilities.
  • providing disability awareness training as a recommended module of the WA Country Health Service induction program for all staff.
  • ensuring people can provide feedback in a range of ways, including by the Patient Opinion website, an independent online consumer feedback platform which has accessibility functions.
  • ensuring that information on patient rights and responsibilities, and feedback options are displayed at WA Country Health Service sites and that information can be made available in alternative formats.
  • facilitating the use of interpreters to improve access to information for people who have difficulty speaking, hearing, seeing and/or reading, or who speak limited English.

In accordance with the Disability Services Act 1993, a progress report has been submitted to the Disability Services Commission outlining our progress against the priorities set out in the plan.

View website - Download a copy of our Disability Access and Inclusion Plan 2015-2020

COMPLIANCE WITH PUBLIC SECTOR STANDARDS AND ETHICAL CODES

The WA Country Health Service values and encourages quality, integrity and justice, and we strive to ensure these values are represented in all that we do.

The WA Country Health Service is committed to complying with the Public Sector Standards in Human Resource Management (the Standards), the Western Australian Public Sector Commission’s Code of Ethics and WA Health Code of Conduct. WA Country Health Service raises awareness of these Standards and Code of Conduct and Ethics by providing information to new employees as part of induction and orientation programs; by including a compliance statement in all Job Description Forms; through mandatory training in Accountable and Ethical Decision Making, Aboriginal Cultural Awareness eLearning programs and the Management Development Program; through policies and procedures; and by publishing information in newsletters, on Notice Boards and on our intranet.

Human resource officers provide a range of consultancy and advisory services to managers and employees to ensure they are aware of and manage their responsibilities in relation to the Standards, together with processing services provided by Health Support Services (payroll and recruitment). Centralised oversight of the recruitment and selection process, including notification of the outcome of recruitment processes ensures that all applicants are provided information about their rights to claim a breach of the Standards.

Complaints alleging non-compliance with the Code of Ethics or Code of Conduct are reviewed, investigated and monitored by WA Country Health Service Industrial Relations, Integrity Unity and Human Resources.

Applications made for breach of Standards review, the outcome of claims, and number of complaints relating to non-compliance with the ethical codes is provided in Table 38 (next page).

"The WA Country Health Service values and encourages quality, integrity and justice, and we strive to ensure these values are represented in all that we do."

Table 38: Summary of Breach of Standards Claims 2018-19

 Recruitment
selection and
appointment
TransfersSecondmentPerformance
management
RedeploymentTerminationTemporary
deployment
(acting)
Grievance
Resolution
Total
(i)  Total claims (include all claims lodged whether resolved internally or referred to the Public Sector Commission)
Claims lodged 2018-19 13 0 0 0 0 0 0 8 21
Claims carried over from previous
financial year
1 0 0 0 0 0 0 1 2
Total claims handled in 2018-19 14 0 0 0 0 0 0 9 23
(ii)  Outcome of claims handled
Withdrawn in agency 7 0 0 0 0 0 0 0 7
Resolved in agency 2 0 0 0 0 0 0 0 2
Still pending in agency 0 0 0 0 0 0 0 0 0
Referred to OPSSC 5 0 0 0 0 0 0 9 14
Total claims handled in 2018-19 14 0 0 0 0 0 0 9 23

FREEDOM OF INFORMATION

The Western Australian Freedom of Information Act 1992 gives all Western Australians a right of access to information held by the WA Country Health Service. The types of information held by the organisation include:

  • reports on health programs and projects
  • briefings for Minister for Health, Board and executive staff
  • health circulars, policies, standards and guidelines
  • health articles and discussion papers
  • newsletters, magazines, bulletins and pamphlets
  • health research and evaluation reports
  • epidemiological, survey and statistical data/information
  • publications relating to health planning and management
  • committee meeting minutes
  • administrative correspondence
  • legislative reporting and compliance documents
  • health infrastructure records
  • financial and budget reports
  • staff personnel records
  • patient records created from episodes of care

Members of the public can access some of the above information from the WA Country Health Service website (www.wacountry.health.wa.gov.au). Members of the public who do not have internet access can obtain hard copy documents for free or a nominal fee outside of the Freedom of Information process.

Access to information under the Freedom of Information Act 1992 must be made in writing and can be lodged via email, sent by post or delivered in person. The written request must provide sufficient detail to enable the application to be processed, including contact details and an Australian address for correspondence.

In the case of an application for amendment or annotation of personal information it is required that the request include:

  • detail of the matters in relation to which the applicant believes the information is inaccurate, incomplete, out-of-date or misleading
  • the applicant’s reasons for holding that belief
  • detail of the amendment that the applicant wishes to have made.

For applications seeking non-personal information there is a fee payable at the time of submission.All requests for information can be granted, partially granted or may be refused in accordance with the Western Australian Freedom of Information Act 1992. The applicant can appeal if dissatisfied with the process, the reasons provided and in the event of an adverse access decision.

View website - The WA Country Health Service has a Freedom of Information coordinator for each region. To view contact details, including postal and email addresses - click here.

For the year ended 30 June 2019, WA Country Health Service dealt with 4,134 applications for information, of which 3,709 applications were granted full or partial access and 150 were refused (Table 39).

Table 39: Applications for information under the Freedom of Information Act 1992 (WA), 2018-19

Applications for information under the Freedom of Information Act 1992 (WA) 
Number of applications carried over from 2017-18* 161*
Number of applications received in 2018-19 3,973
Total applications active in 2018-19 4,134
Number of applications granted – full access 1,897
Number of applications granted – partial or edited access 1,812
Number of applications withdrawn by applicant 46
Number of applications refused 150
Number of applications in progress 229
Other applications 0
Total applications dealt with for 2018-19 4,134

*Note that this figure includes a correction to FY17/18 data to include 7 FOI requests not previously reported.

RECORDKEEPING PLANS

WA Country Health Service has an agency-specific Recordkeeping Plan and supporting framework approved by the State Records Commission, which address the geographic challenges of country WA. This includes information on the recordkeeping system(s), record archiving and disposal arrangements, policies, practices and processes that comply with the State Records Act 2000.

Resources, advice and guidance regarding corporate recordkeeping are made available to all staff through the intranet, staff newsletters and training sessions. Strategies to ensure employees are aware and comply with the Recordkeeping Plan include online recordkeeping and awareness and systems training. In 2018-19, over 2,300 employees completed the mandatory online Recordkeeping Awareness training course, which is included in the WA Country Health Service induction program. The efficiency and effectiveness of the training program is reviewed on a regular basis via trainee feedback and assessments. Regular communication with end users of recordkeeping system is maintained through targeted training sessions including ‘master classes’ for specific user groups. In addition, improved reporting has been implemented to ensure that managers have timely access to compliance information.

Across the WA Country Health Service, over 670,000 records were created in the Electronic Document and Records Management System (EDRMS) during 2018-19. Over 750 users completed the EDRMS training program in 2018-19. The EDRMS content and functionality is reviewed regularly and new automated processes were implemented in this period. This includes the tracking and transfer of approved electronic invoices which has improved recordkeeping compliance and efficiencies in the payment processing.

The WACHS Recordkeeping Plan was reviewed in 2018 and has been approved by the State Records Commission with the next review due in August 2023.

SUBSTANTIVE EQUALITY

The WA Country Health Service is committed to substantive equality for Western Australians living in the regions through the implementation of the WA Health Policy Framework for Substantive Equality. Our commitment to recognising the diversity of our employees, consumers and other stakeholders is reflected in our organisational values, and reflected in our policies and procedures.

WA Country Health Service is committed to ensuring people with disability, their families and carers are not discriminated against. This includes providing strategies to increase independence, opportunities and inclusion for people with disability and detailed strategies are outlined in the WA Country Health Service Disability Access and Inclusion Plan 2015–2020.

A key focus for the organisation in contributing towards substantive equality is improving the health outcomes of Aboriginal people through a coordinated approach to the planning, funding and delivery of Aboriginal health programs, and continuing to grow and support our Aboriginal health workforce in all areas including professional streams, and a non- Aboriginal workforce that understands and responds to the needs of Aboriginal people.

In 2018-19 we have contributed to substantive equality in the following ways:

  • Development of an Aboriginal Health Strategy to outline the organisation’s approach to improve health outcomes for country Aboriginal people in WA.
  • Development of the WA Country Health Service Action Plan to Implement the WA Aboriginal Health and Wellbeing Framework 2018-2020. The Action Plan outlines our services and initiatives that contribute to implementation of the WA Aboriginal Health and Wellbeing Framework 2015-2030 in line with Mandatory Policy – Aboriginal Health and Wellbeing Policy 2017 (MP 0071/17).
  • Continued implementation of the Aboriginal Health Programs (AHP) (formerly Footprints to Better Health).
  • Continued implementation of the Aboriginal Comprehensive Primary Health Care Program (ACPHCP).
  • Provision of grant funding to facilitate secretariat support to the Regional Aboriginal Health Planning Forums.
  • Continued implementation of the Aboriginal Mentorship Program.
  • Appointment of Regional Aboriginal Health Consultants in the Midwest and Kimberley, and currently recruiting Regional Aboriginal Health Consultants to the remaining five regions.
  • Continued implementation of the WA Country Health Service Aboriginal Entry Level Employment Program.
  • Evaluation of the Aboriginal Health Practitioner pilot project in the Kimberley region.
  • As at March 2019, WA Country Health Service employed a total of 445 Aboriginal people, equating to 4.2% of our workforce. This is above the 3.2% target set by the Public Sector Commission for WA Health.
  • As of 3 June 2019, 88.9% of WA Country Health Service employees had completed the Department of Health’s mandatory Aboriginal Cultural eLearning Package.
  • Expanded the Country Health Connection Meet and Greet service to provide services from 6.00am to 10.00pm Monday to Friday and as required on the weekends.
  • As of 1 July 2019, WA Ccountry Health Service assumed full management and operational responsibility for the Elizabeth Hansen Autumn Centre (EHAC). EHAC is a 32 bed residential hostel accommodating Aboriginal people who require specialist medical treatment and their carers, from remote and regional communities.
  • Continued our longstanding participation and support of a range of state and national forums including the Statewide Aboriginal Health Network and the WA Aboriginal Health Partnership Forum.
  • Continued our engagement with key agencies and partners including the Aboriginal Health Council of WA, Commonwealth Department of Health, WA Primary Health Alliance, Rural Health West and Metropolitan Health Service Providers.

OCCUPATIONAL SAFETY, HEALTH AND INJURY MANAGEMENT

Commitment to occupational safety, health and injury management

The WA Country Health Service is committed to providing a safe workplace and achieving high standards in safety and health for its employees, contractors, volunteers and visitors. The organisation follows an integrated risk management approach to occupational safety and health (OSH) that is underpinned by policies and procedures in accordance with the Occupational Safety and Health Act 1984, the Occupational Safety and Health Regulations 1996 and the Code of Practice on Occupational Safety and Health in the Western Australian Public Sector.

The WA Country Health Service takes a proactive approach to occupational safety and health by establishing clear policies, goals, strategies and monitoring systems, implementing preventative programs and articulating employee responsibilities. Hazard and risk management processes include the use of Safety Risk Report forms, workplace inspections, risk assessments and Job Hazard Analysis. Occupational safety and health documents and resources are available online to all staff.

Occupational Safety and Health performance is driven by establishing measurable objectives and targets through planning activities.

Occupational violence in health care is a serious issue that is increasing in prevalence. WA Country Health Service has developed and is implementing a Preventing and Managing Occupational Violence Strategy 2019-2023 to achieve high standards of safety and consistency across WA Country Health Service locations.

The strategy delivers a multifaceted approach to eliminate or control, as far as reasonably practicable, the risk of occupational violence, and to ensure support is provided to staff.

Consultation

Consultation on safety and health matters occurs with safety and health representatives and the formation of safety and health committees. These committees meet on a regular basis. Safety and health representatives provide a valued conduit for occupational health and safety matters between our health service locations, assisting management and employees to identify and effectively manage safety risks.

These processes facilitate communication with management on occupational safety and health issues and support hazard and incident reporting. This ensures issues are formally recognised and actions are communicated to management for progression and resolution.

Compliance with occupational safety, health and injury management

WA Country Health Service provides a comprehensive injury management service to support injured workers and to facilitate return to work programs. This service is guided by the requirements of both the Workers’ Compensation and Injury Management Act 1981 and the Workers’ Compensation Code of Practice (Injury Management) 2005.

This service is provided by occupational health and safety and injury management staff and includes claims lodgement, assistance and processing, early intervention, return to work programs and claims management. This ensures a high level of support is provided to injured workers and their managers.

Employee consultation

All regions within the WA Country Health Service facilitate occupational safety and health management and consultation through:

  • the election of occupational safety and health representatives;
  • the establishment of regional occupational safety and health committees and strategic occupational safety and health groups;
  • hazard/incident reporting and investigation;
  • routine workplace inspections;
  • resolution of issues process; and
  • the implementation of regular audits, risk assessments and control measures to prevent incidents occurring.

Regional occupational safety and health committees meet regularly to discuss and resolve occupational safety and health issues. These processes facilitate communication with management on occupational safety and health issues and support hazard and incident reporting. This ensures issues are formally recognised and actions are communicated back to the employee and occupational safety and health representative.

Employee rehabilitation

WA Country Health Service has a dedicated injury management system which enables systematic management of workers’ compensation claims and the provision of injury management services that are administered in accordance with the Workers’ Compensation and Injury Management Act 1981.

Injury management services are provided to support the development of return to work programs for staff with a work-related injury or illness. The organisation adopts a case management approach involving the WA Country Health Service Injury Management Coordinator, the injured worker and their treating medical provider to facilitate the early and safe return to work of injured workers.

Return to work performance is reported to the WA Country Health Service Executive on a quarterly basis. Employee rehabilitation programs also extend to non-compensable injuries where there is a risk of exacerbating factors and/or a requirement to provide expert advice to facilitate the employee’s safe return to work.

Occupational safety, health assessment and performance indicators

The annual performance reported for the WA Country Health Service in relation to occupational safety, health and injury for 2018-19 is summarised in Table 40.

Table 40: Occupational safety, health and injury performance, 2015-16 to 2018-19

MeasureActual results: 2016-17Actual results: 2017-18Actual results: 2018-19Results against target: TargetResults against target: Comments
Number of Fatalities 0 0 0 0  
Lost time injury and/or disease incidence rate 2.56 2.73 2.27 0 or 10%
reduction on the previous three (3) years)
 
Lost time injury and/or disease severity rate 32.98 42.00 36.78 0 or 10%
reduction on the previous three (3) years)
 
Percentage of injured workers returned to work:
i) Within 13 weeks 57.2% 47% 37.8% Greater than or equal to 80% return to work within 26 weeks. Target not achieved
ii) Within 26 weeks 69.4% 51% 40.9% Greater than or equal to 80% return to work within 26 weeks. Target not achieved
Percentage of managers trained in occupational safety, health and injury management responsibilities 86% 88% 86% Greater than or equal to 80% Target achieved

In the 2018-19 period there was a decrease in the number of Workers’ Compensation claims lodged. Of those claims, there was a decrease in the number of lost time injuries and severe cases, however WACHS still was above the severity rate target. A review of the injury management system has commenced, with a focus on early injury management intervention, the aim being to reduce the severity of these cases.

Note: Performance is based on a three-year trend and as such the comparison base year is two years prior to the current reporting year (ie. current year is 2018-19 and comparison base year is 2016-17)

SENIOR OFFICERS

Senior officers and their area of responsibility for the WA Country Health Service as at 30 June 2019 are listed in Table 41.

Table 41: WA Country Health Service senior officers

Area of responsibilityTitleNameBasis of appointment
WA Country Health Service Chief Executive Mr Jeffrey Moffet Term contract
Operations Chief Operating Officer Ms Margaret Denton Acting
Innovation and Development * Executive Director Ms Robyn Sermon Term Contract
Strategy and Change Executive Director Ms Melissa Vernon Acting
Nursing and Midwifery Executive Director Ms Marie Baxter Term Contract
Medical Services Executive Director Dr Tony Robins Term Contract
Medical Services Executive Director Dr Andrew Jamieson Term Contract
Business Services Executive Director Mr Jordan Kelly Term Contract
Mental Health Executive Director Ms Paula Chatfield Term Contract
Health Programs Executive Director Ms Margaret Abernethy Acting
Regional Operations Regional Director Goldfields Ms Geraldine Ennis Substantive
Regional Operations Regional Director Great Southern Mr David Naughton Term contract
Regional Operations Regional Director Kimberley Ms Rebecca Smith Term contract
Regional Operations Regional Director Midwest Mr Jeffrey Calver Term contract
Regional Operations Regional Director Pilbara Ms Margi Faulkner Term contract
Regional Operations Regional Director Southwest Ms Kerry Winsor Substantive
Regional Operations Regional Director Wheatbelt Mr Sean Conlan Term contract
Office of the Chief Executive Director Ms Tracy Rainford Substantive
Finance Director Mr John Arkell Substantive
Infrastructure Director Mr Robert Pulsford Substantive
Aboriginal Health Strategy Director Mr Russell Simpson Substantive

Note: *The position of Executive Director Innovation and Development was filled by Ms Melissa Vernon until 29 March 2019.

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