Radical surgery: The only cure for NSW Hospitals

12 Feb 2009

NSW public hospitals are plagued by massive systemic failures, as diagnosed in the Garling report. At the same time, hospital costs are blowing out, and may yet bankrupt the NSW budget despite a massive federal bailout under the COAG agreement. The situation requires dramatic and fundamental changes to hospital management—not additional layers of bureaucratic control or more federal subsidies.

The Garling report—correct and to the point in diagnosing the failures of NSW public hospitals—failed to outline cures that can tackle the underlying causes of the healthcare crisis. Instead, it exhausts itself in numerous recommendations that amount to no more than marginal tinkering with a wrongly conceived and untenable system.

The underlying cause of the crisis is excessive, parasitic and superfluous bureaucratisation— something the health system shares with other areas of public sector service delivery in NSW, from transport and education to child protection.

The hospital malaise can only be remedied by removing the central, bureaucratic control of hospitals and creating opportunities for spontaneous, decentralised and customer-oriented supply of hospital care. Taking for granted that many Australians want heavy subsidies to cover the cost of hospital stays, this essay explores how to provide public hospital care with less bureaucracy. The author argues for a separation of the provision of access to hospitals for those in need from the production of services in government-run hospitals.

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