A Comparison of Public Hospital Costs in Queensland and New South Wales

Abstract

This chapter addresses the perplexing question of the reasons for interstate differences in public hospital costs between two States in Australia. At the outset, one may well question the wisdom of such a venture. To say that the Commonwealth Grants Commission (CGC)—a body vitally concerned with interstate comparisons—has found this area bothersome would be an understatement. In both the Report on State Tax Sharing Entitlements 1981 (CGC 1981) and the Report on State Tax Sharing and Health Grants 1982 (CGC 1982), the Commission was forced to exercise “broad judgment” as a supplement to the meagre amount of information and analysis available on the causes of interstate variations in per capita expenditures in the General Medical Services category (of which expenditure on hospital-type services accounted for about 76 per cent—CGC 1981, Vol.I, p.181). The inadequacy of currently available data was mentioned several times in the latter Report (see CGC 1982, Vol.I, pp.9,114,115), leading the CGC to assert that “if any future inquiry into tax sharing relativities on hospital costs is to be undertaken by the Commission, it would regard it as essential to develop appropriate procedures and institute suitable inquiries to overcome the basic data deficiencies… ” (CGC 1982, Vol.I, p.9).