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Scrapped performance payments a bonus for the system

30 March 2009.

AMA Victoria today welcomed the State Government’s abolition of a $40 million bonus funding pool used to reward public hospitals for meeting performance targets.

AMA Victoria President Dr Doug Travis said the government’s decision to scrap the bonus pool acknowledged that perverse incentives for hospitals to meet their Key Performance Indicators (KPIs) were a bad idea.

“The culture in Victorian hospitals has been to hit your KPIs no matter what,” he said.

“We’re glad the bonus system has been scrapped and the money redirected back into the system, without the strings attached. This will allow hospitals to focus on the most important issue – patient care – rather than jumping through hoops. 

Dr Travis said good financial planning was the hospital system’s life blood. “If the figures aren’t accurate, the funding won’t match the real need,” he said.

“Our community needs to be assured that hospital funds and resources are directed where they are needed.

“The Minister has only just now made a statement that data manipulation will not be tolerated. It is the Minister’s responsibility to ensure performance data is accurately reported.”

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