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Significant slowdown in costs

Cost per National Weighted Activity Unit (NWAU)

The NWAU is a measure of health service activity expressed as a common unit, against which the national efficient price is determined. Figure 5 indicates a significant reduction in the rate of growth in costs since 2011–12, to a sustained growth rate of 1.9 per cent.

Cost per National Weighted Activity Unit (NWAU) X-Axis 2006–07 - $3,596 2007–08 - $3,739 2008–09 - $3,949 2009–10 - $4,233 2010–11 - $4,319 2011–12 - $4,466 2012–13 - $4,564 2013–14 - $4,571 2014–15 - $4,672 2015–16 - $4,754 2016–17 - $4,840 2017–18 - $4,998 2018–19 - $5,103 Y-Axis $5,100 $4,900 $4,700 $4,500 $4,300 $4,100 $3,900 $3,700 $3,500

National efficient price

The national efficient price represents the average cost of a hospital admission across Australia, and is a determinant (along with the volume of services delivered) of the Australian Government’s funding contribution to public hospitals.

Figure 6, below, is an indicator of the success of activity based funding in controlling costs.

As required under the National Health Reform Agreement (cl A40), IHPA back-casts the national efficient price whenever significant changes to the methodology or underlying data occur, to enable the fair calculation of the Australian Government’s growth funding.

National Efficient Price 2012–2020 Y-Axis $5,500 $5,300 $5,100 $4,900 $4,700 $4,500 X-Axis 2012–13 - $4,808 2013–14 - $4,993 2014–15 - $5,007 2015–16 - $4,971 2016–17 - $4,883 2017–18 - $4,910 2018–19 - $5,012 2019–20 - $5,134 2020–21 - $5,320