Contents

Contents

Executive Summary

1Overview

1.1 Context

1.2 Purpose of the Performance Framework

2Performance Requirements under the Act

2.1 Performance Requirements

2.2 Unsatisfactory Performance

3Performance Monitoring Mechanisms

3.1 Service Agreement

3.2 Corporate Plan

3.3 THS Governing Council/THS Functions and Powers

4Performance Interventions under the Act

4.1 Under Review

4.2 Level 1 - Performance Improvement Plan (PIP)

4.3 Level 2 - Appointment of a Ministerial Representative or a PIT

4.4 Level 3 - Dissolve the Governing Council, Appoint an Administrator and/or Appoint a New Governing Council

5Performance Interventions – Process for Implementation

Appendix

Executive Summary

Under the TasmanianHealth Organisations Act 2011 (the Act)the Tasmanian Health Service (THS) Governing Councilis accountable to the Minister for Health and the Treasurer for the performance of its powers and functions. This includes ensuring that the THS performs its functions and exercises its powers in a satisfactory manner and also includes the monitoring of the THS’ performance against performance measures set out in the THS’ service agreement.

The Department of Health and Human Services is responsible to the Minister in relation to the Act’s administration, and the Minister has delegated a number of performance related functions and powers to the Secretary, Department of Health and Human Services (DHHS) in this context.

This is consistent with the National Health Reform Agreementwhich recognises the states and territories as ‘system managers’ of the public hospital system, which includessystem-wide public hospital performance. The relationship between the Minister for Health, the Secretary (as the Minister’s delegate), the Department, and the THS Governing Council is articulated in the ‘DHHS as System Manager,’[1]document.

ThisPerformance Framework (the Framework)provides a single, overarching administrative process through which the THS’ performance may be monitored. It should be noted that, whilst applying more broadly than section 45 of the Act, this Framework has been developed to meet the requirements of s45 (1)(e). The aim of the Framework is to describe the relevant provisions of the Act as well as outlining how they will be practically implemented. As such, in addition to referencing the relevant provisions and accountabilities of the Act, the Framework details administrative processes that serve to operationalise them. This is particularly the case where the relationship between the Department and the THS CEO, in discussion and review of performance issues and performance interventions,is articulated.

For example, a new “under review” phase of the performance escalation processis included in the Framework. Once a performance issue has been identified, officers of the Department will commence discussions with the THS to confirm the issue and may require the THS to provide formal advice on the reasons leading to the issue and the actions to be put in place by the THS to remediate it. During this phase, if the view is formed that the THS is unable to remediate the issue, a performance escalation may be recommended.

Whilst its primary focus is on the early identification and remediation of performance issues, equally, strong performance will be highlighted and acknowledged. The Minister and the Secretary are committed to working with the THS Governing Council and the THS to drive high levels of performance whilst at the same time ensuring that performance issues are identified and acted upon in a timely manner.

The Framework expands on the previous 2015-16 Service Agreement Performance Framework. In addition to performance against the requirements of the service agreement, the Framework’sscope now includes:

  • Performance against the corporate plan (to ensure the requirements of the corporate plan are being met), and
  • Performance by the Governing Council of its functions to ensure that it performs its functions and exercises its powers in a satisfactory manner.

In addition to the “under review” phase, three levels of performance escalation are described and high level guidance on the implementation of the performance interventions applicable at each level of escalation, and the requirements for de-escalation, are also provided.

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Appendix

1Overview

The THS Governing Council is accountable to the Minister for Health and the Treasurer forensuring that the THS provides effective and safe health care and performs its functions, and exercises its powers, in a satisfactory manner.

The Department assists the Governing Council in its obligations to the Minister by providing strategic leadership and direction and through the establishment of a governance framework of processes, procedures and controls. This is consistent with the Department’s role as system manager.

In order for the Department to meet its obligations as system manager and Ministerial delegate, it is crucial that performance issues are identified and that the Department can take appropriate action and provide direction to ensure that the THS Governing Council can meet its performance obligations.

1.1 Context

The object of the Act is to assist in the establishment of a public sector health system that delivers safe, high quality health services and health support services so as to improve, promote, protect and maintain the health of Tasmanians (s 3(1)).

This object is achieved through the establishment of Tasmanian Health Organisations for the provision and coordination of health services and health support services (s 3(2)(a)).

In Tasmania there is one Tasmanian Health Organisation – the Tasmanian Health Service (THS). As such, for the purposes of this document where the Act is referenced, THS will be used rather than THO.

The THS’ primary purpose is to promote and maintain the health of Tasmanians and to provide care and treatment to, and ease the suffering of, people with health problems (s 10).

The THS’s functions include:

  • To improve, promote, protect and maintain the health of Tasmanians
  • To provide effective and safe care
  • To conduct and manage public hospitals, health institutions, health services, and health support services that are under the THS’ control
  • To provide training and education and to undertake research and development that is relevant to the provision of health services and health support services
  • To manage the organisation’s budget and its other funds to ensure the efficient and economic operation of public hospitals, health institutions, health services and health support services, and delivery of health services, and health support services that are under the THS’ control, and the efficient and economic use of its resources (s 11).

The Act provides that the Governing Council of the THS is responsible to the Minister for Health and the Treasurer for the performance of functions and the exercise of powers under the Act (s 14).

The Governing Council’s functions include:

  • To ensure that the THS:
  • Delivers the services that it has agreed, under the THS’ service agreement, to provide, and
  • Delivers those services in accordance with the performance standards set out in the service agreement,
  • Delivers those services in accordance with the budget set out in the THS’ annual business plan, and
  • Delivers those services in accordance with the THS’ corporate plan, and
  • To monitor the THS’ performance against the performance measures set out in the service agreement, and
  • To ensure that the objectives specified in the THS’ ministerial charter and corporate plan are achieved (s 22).

The THS must act in accordance with its corporate plan (s 48) and business plan (s 51); and the THS may be considered to be performing unsatisfactorily if the Minister is of the opinion that the THS has failed to meet the requirements of its service agreement or corporate plan, or if the organisation, or the Governing Council of the organisation, has not been performing its functions, or exercising its powers, in a satisfactory manner (s 59).

The Minister, or the Secretary as delegate, may authorise a person or persons to conduct a review or audit of any aspect of the THS’ operations or performance (s 58) and may require a governing council to produce a performance improvement plan and appoint a performance improvement team if the THS is performing unsatisfactorily (ss 60 and 67 respectively).

1.2 Purpose of the Performance Framework

TheActestablishes the accountability relationship between the responsible Ministers and the THS Governing Council. It also outlines the performance requirements of the Governing Council and identifies the interventions available to the Minister for Health and delegatewhen a performance issue is identified.

The Framework provides a single, overarching administrative process through which the legislative framework established by the Act is translated into a consistent and transparent approach for the identification, monitoring and management of the THS’ performance. It provides the THS with certainty regarding responses to identified performance issues, establishes a structure around the legislative performance interventions available and describes processes through which the escalation and de-escalation ofidentified performance issues occurs.

While all efforts will be made to ensure the Framework is consistently applied, it is not in itself a legislative requirement. The Act provides the responsible Ministers with all required powers in relation to the performance management of the THS: they can at any time act in accordance with those powers, outside of the processes described in the Framework.

The Framework includes the following sections:

  1. Performance Requirements under the Act
  2. Performance Monitoring Mechanisms
  3. Performance Interventions under the Act
  4. Performance Interventions – Process for Implementation

Diagram 1 on the following page summarises the four sections described above.

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Appendix

Diagram 1: System Manager – Performance Management Component

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Appendix

2Performance Requirements under the Act

2.1 Performance Requirements

Parts 5 and 6 of Actestablish the accountability relationship between the responsible Ministers and the THS. These Parts also identify the performance requirements that the THS is expected to meet.

Part 5 of the Act provides for Ministerial Charters, Ministerial Policies and Directions and Service Agreements.

Part 6 of the Act provides for Corporate Plans, Business Plans and Reporting.

Under Part 5 of the Act:

  • The Minister for Health and the Treasurer must issue a Ministerial Charter for the THS (s 39). The Ministerial Charter is to specify the Ministers’ broad policy expectations for the THS (s 40). The Governing Council must ensure that the business and affairs of the organisation are conducted in a manner that is consistent with the Charter (s 41).
  • The Minister for Health may require the THS to implement a policy (s 42) and may give the Governing Council directions in relation to the functions and powers of the THS and its Governing Council (s 43).
  • The Minister for Health and the THS will enter into a Service Agreement (s 44). The Agreement must include a schedule of services to be provided by the THS and the funding to be provided in respect of those services. The Agreement must also include performance standards, targets and measures and a performance management process for the THS (s 45).

Under Part 6 of the Act:

  • The THS Governing Council must give the Minister for Health and the Treasurer a Corporate Plan. The Plan must contain actual and estimated information for a minimum six year period, in accordance with Treasurer’s Instruction THO 04-46-01, and be consistent with the THS’ Ministerial Charter (s 46). The THS is required to act in accordance with the Corporate Plan, unless the Minister approves otherwise (s 48).
  • The THS Governing Council is required to produce an annual Business Plan within 30 days of entering into a Service Agreement under section 44 of the Act. The Plan is to set out how the THS intends to meet the requirements of the Service Agreement and a budget specifying how the THS’ funds are to be expended to meet the requirements of the Agreement during the year (s 50). The THS is required to act in accordance with the Business Plan (s 51).
  • The Minister for Health, or the Treasurer, may require the THS to provide progress reports (s 52) and specified reports (s 56). An Annual Report is also required (s 53).

2.2 Unsatisfactory Performance

Part 7 of the Actdefines unsatisfactory performance and sets out the performance interventions available to the Minister for Health when unsatisfactory performance is identified.

Section 59 of the Act provides that a THS is performing unsatisfactorily if the Minister is of the opinion that:

  • The THS has failed to meet the requirements of its Service Agreement or its Corporate Plan, or
  • The THS, or the THSGoverning Council, has not been performing its functions, or exercising its powers, in a satisfactory manner.

The Minister may authorise a review or audit of any aspect of the THS’ operations or performance to identify whether the THS’ performance is satisfactory, or unsatisfactory within the meaning of section 59 of the Act (s 58).

If the Minister is of the opinion that the THS is performing unsatisfactorily there are a range of actions that can be taken, as follows:

  • The Minister may require the Governing Council to produce a Performance Improvement Plan (PIP) (s 60).
  • The Minister may appoint ministerial representatives to the Governing Council (s 63).
  • The Minister may declare that a Performance Improvement Team (PIT) has been appointed (s 67).
  • The Minister may dissolve the Governing Council (s 69).

Importantly, most of the actions are designed to provide temporary assistance and/or resources to the Governing Council and/or the THS rather than being punitive. They are designed so that there are graduated interventions that can be applied, rather than the responsible Minister having the sole option of dissolving the Governing Council.

The process for implementation of these performance interventions is outlined in section 4 of this document.

3Performance Monitoring Mechanisms

The routine monitoring of THS performance by the Department is critical in ensuring that the THS is meeting its performance requirements and that the Department is meeting its obligations as system manager. The timely identification of performance issues on an emerging basis is important in ensuring that a sound understanding of the cause and contributing factors can be established and the most appropriate action required to remediate the issue can be implemented.

The monitoring mechanisms in place are briefly outlined below. Importantly, beyond those mechanisms, the Governing Council has an important responsibility to monitor the organisation’s performance against the performance measures set out in the service agreement.

3.1 Service Agreement

The Actspecifies that by 30 June each year, there must be in place a service agreement between the Minister and the Governing Council for the following financial year (s 44).

The service agreement must include:

  • A schedule of services and the funding to be provided in relation to the provision of those services.
  • Performance standards, performance targets and performance measures for the THS.
  • Standards of patient care and service delivery.
  • Requirements for the THS to report on its performance.
  • A continuous performance management process (s 45).

The service agreement may include other provisions in respect of a matter relating to the THS’ functions or powers that the Minister thinks fit (s 45(2)).

The THS Governing Council is required to ensure that the THS delivers the services that it has agreed to deliver under the organisation’s Service Agreement and to provide those services in accordance with the performance standards set out in the Agreement and in accordance with the budget set out in the Business Plan (s 22). In addition, the THS is required to deliver services in accordance with the performance standards set out in the Service Agreement, within the funding provided, and specifically:

  • To ensure that appropriate corporate and clinical governance procedures are in place in relation to the organisation (s 22)
  • To implement policies in respect of the THS’ operation (s 22)
  • Meet performance standards and targets for the organisation (Key Performance Indicators (KPIs)) set out in the THS’ Service Agreement (s 45). KPIs are grouped under the performance domains as outlined below (see Table 1).

Table 1: Service Agreement KPI Performance Domains

Performance Domain / Example
Acceptability / Services are respectful and responsive to user needs, preferences and expectations.
Accessibility / Services are obtained in the most suitable setting in a reasonable time and distance.
Appropriateness / Services are relevant to consumer needs and are based on accepted or evidence-based practice.
Effectiveness / Services are provided based on scientific knowledge to achieve desired outcomes.
Efficiency / Resources are optimally used in achieving desired outcomes.
Safety / Mitigate risks to avoid unintended or harmful results.

The Department monitors performance against the requirements of the Service Agreement on a routine basis. To ensure performance issues are addressed in a timely fashion, discussions with the THS are commenced as soon as a performance issue is identified.

3.2 Corporate Plan

The Act also specifies that the Governing Council of the THS must provide the Minister for Health and the Treasurer a draft of a corporate plan for the THS not later than 90 days before the day on which it is intended that it will take effect. The Corporate Plan must:

  • Relate to the period and be in the form specified in the Treasurer's Instructions THO 06-46-01.
  • Contain the information specified in the Treasurer’s Instruction including any information specified in the Instructions as to the THS’ objectives, policies and programs.
  • Be consistent with the organisation’s Ministerial Charter (s 46).

The THS Governing Council is responsible for ensuring that the THS delivers services in accordance with the Corporate Plan and that the objectives specified in the Corporate Plan are achieved (s 22).

Once approved by the Minister, the Department conducts routine monitoring of the requirements of the plan to ensure the THS is complying with those requirements.

3.3 THS Governing Council/THS Functions and Powers

The functions and powers of the Governing Council are outlined in sections 22 and 23 of the Act. This includes ensuring that the THS performs its functions, and exercises its powers, in a satisfactory manner.