The Department of Health and Ageing needs to better understand the stakeholders it funds and regulates to avoid becoming beholden to the hospitals, aged care providers and health professional groups with the loudest voices, an APSC review says.

The capability review says the department needs to leverage the considerable data and expertise available to develop a deeper commercial understanding of these groups, business and organisations.

“These providers include hospitals, aged care homes, general practitioners, medical specialists and allied health practitioners,” the review team says.

“Without that knowledge, the department is seen by many to be susceptible to place too much weight on the loudest voices in discussions and negotiations, when they often represent the views of less sophisticated providers or practitioners rather than the average or more sophisticated providers.“

The department is seen by many to be susceptible to place too much weight on the loudest voices in discussions and negotiations, when they often represent the views of less sophisticated providers or practitioners.

APSC capability review

The report is a pilot for the APS capability review program, which was recommended in David Thodey’s Our Public Service Our Future report and represents the first time the department has been reviewed in almost ten years.

The report found health department staff feel engaged and supported, and the department is “well placed” to refocus its efforts to achieve its vision of better health and wellbeing for all Australians.

However it also predicts the health and aged care system will come under “enormous strain” over the the next four years in relation to to:

• demand for aged care

• health workforce

• cost of hospital care

• shift from acute care to chronic disease management

• preparation for the next pandemic

It notes the department is in the process of putting in place major reforms, including the response to the Aged Care Royal Commission and Strengthening Medicare Taskforce.

“But  more work is needed to integrate policy and on-the-ground delivery of these important commitments. This is an area that will require sustained focus and investment over the coming years,” it says.

Embedding data:

The report says the department is viewed as having ‘highly capable data scientists and analysts’, yet there’s evidence this talent isn’t being fully used.

“We heard that the department had invested in tools to allow policy analysts throughout the organisation to perform independent analysis of linked data sets. However, the use of data is not yet embedded throughout the department, and key program and delivery areas,” the review says.

“Looking forward, the department needs to empower policy makers at various levels to improve their understanding of the availability, flaws and possibilities of data sources.”

Workforce leadership

It also calls for the  department to take a greater national leadership role in aged care workforce policy, describing this as one of the most pressing challenges across the sector.

The report notes that segments of the workforce float between the primary, hospital, aged care and NDIS, making it difficult to develop policy for one sector without considering the implications for the others.

“Current health and aged care workforce capabilities are scattered across the department, and it should consider how capabilities can best be organised to give integrated policy advice,” it says.

Grants governance

Another area where the department can improve, the reviewers say, is grants evaluation.

The department is the largest single granting agency in the Commonwealth in terms of volume – with 17,934 grants in 2022–23 valued at $9.7 billion – and that figure’s set to grow.

 “There is an opportunity for the department to improve its evaluation of grants,” the report says.

“We heard commentary on the large number of grants, the challenges in maintaining relationships when different parts are managed by different people in different organisations, risks around automation and fraud, and the difficulty in evaluating grants and having ownership of the outcomes when not involved in all stages of the grant.”

Preventing mid-level management churn

The report warns that a high turnover among mid-level leaders – including branch heads, directors and team leaders – means decisions can end up being escalated when they could be more appropriately managed at lower levels.

“We heard there is latent capacity in these levels that will leave if left untapped,” the report warns, saying this can be addressed by improving succession planning and creating better handovers when mid-level managers move.

The review was led by independent reviewers Andrew Tongue and Larry Kamener and Infrastructure Deputy Secretary Dave Hallinan.

The department will publish an action plan responding to the review in October.