Mr Garry Richardson has extensive experience in the health and financial services sectors and is a Fellow of the Australian Institute of Company Directors. Before retiring from his executive career at the end of 1997, Mr Richardson was Managing Director of National Mutual Health Insurance Pty Ltd (now known as BUPA Australia) for seven years. He was concurrently Vice President of the Australian Health Insurance Association and Board member of the International Federation of Health Funds (based in the United Kingdom).
Since retiring, Mr Richardson has been appointed to several boards in the state, Federal, private and not-for-profit sectors. At present, in addition to being Chair of the NBA Board (since May 2007), he serves as Chair of Health Super Pty Ltd (since January 2001) and Independent Chair of the City of Stonnington’s Audit Committee (since 2000).
This is my second report as Board Chair, and I am pleased to note that the NBA has made excellent progress on all activities that were the focus of the Board’s attention this year.
This is my second report as Board Chair, and I am pleased to note that the NBA has made excellent progress on all activities that were the focus of the Board’s attention this year.
The NBA Board was established under the Act with four functions:
Board members are selected by the Australian Health Ministers Conference and appointed by the Australian Government Minister for Health and Ageing to serve a period not exceeding four years. The Board is required under section 44(2) of the National Blood Authority Act 2003 to report on its activities on an annual basis.
The Board held four face-to-face meetings and two teleconferences during 2008–09. The Board has continued to work with the General Manager to encourage continuing performance improvement and productivity achievements. I note that the executive of the NBA takes this responsibility very seriously and has put much effort into developing the NBA’s capacity to respond to the changing expectations of its stakeholders into the future. I look forward to working with the executive to monitor and evaluate the effectiveness of these changes through the regular reporting provided to the Board on core operational performance.
As foreshadowed in my report last year, the Board identified five areas where the General Manager could be expected to seek the Board’s advice.
Maintaining a consistent approach to the assessment of new products and technologies for consideration in the National Products and Services List has proved a challenging task for JBC and the NBA in the past couple of years. Good progress was, however, achieved in 2008–09. The Board is mindful of the responsibility placed on the NBA by the National Blood Agreement to arrange for the evidence-based evaluation of new products before they are recommended for inclusion on the National Products and Services List. The Board has provided advice on the new model, which was developed during the reporting year. This has evolved into a multi-criteria analysis framework that, in the view of the Board, pays appropriate attention to the multi-faceted expectations and objectives of the Agreement—including safety, clinical benefit and cost-effectiveness. Importantly, the new framework also recognises that blood must be considered as part of the broader health sector. It incorporates elements of the existing technical and economic imperatives of the Pharmaceutical Benefits Scheme and Medical Benefits Scheme frameworks. The final version has now benefited from public consultation and will be presented to governments for endorsement in 2009–10.
In July 2008 health ministers accepted the recommendations of the business study that looked at the efficiency and effectiveness of the ARCBS. The Minister for Health and Ageing provided to the ARCBS a detailed statement of government expectations in October 2008. These two developments provided a strong background against which the NBA Board has been able to forge a relationship with the ARCBS Board. This relationship will improve the ARCBS’s understanding of its accountability to government, as well as improve government’s understanding of the pressures on the ARCBS. I am delighted to report that our Board met with the ARCBS Board in Adelaide in October 2008 and the General Manager and I met with the ARCBS Board in March 2009. Matters raised at these meetings will be further addressed when the ARCBS Chief Executive and a Board representative attend the July meeting of the NBA Board in Canberra. This ongoing series of meetings will form the basis of a new governance exchange between the two Boards that will promote more rapid responses to government expectations of accountability and transparency. The engagement will also support the development of agreed clear, longer term strategic priorities to be planned and progressed efficiently.
Central to this accountability and overall improved governance will be agreement by the ARCBS and the NBA to an output-based funding model. The NBA Board will continue to oversee the progress of this project and help to secure the engagement of the ARCBS Board to deliver on this expectation of governments.
The NBA Board also provided advice to the General Manager in relation to the next ARCBS Deed of Agreement. The Board was supportive of the decision to extend the current Deed, which has proved an effective vehicle for ARCBS–NBA engagement. Extension of the Deed will allow both parties to progress and finalise all the new elements that will be central to a new Deed, rather than attempting to negotiate a Deed that will need to be revised shortly after its commencement.
Negotiations for the new plasma products agreement with CSL Ltd are on track, and the Board is confident they will provide a good outcome for the sector. The new agreement is expected to be in place by 1 January 2010. The Board has contributed advice and strategic guidance to the NBA General Manager in ensuring that the financial implications for governments are fully explored, and the Board has used its broad sector knowledge to provide insight into the negotiation phase.
The National Blood Agreement recognises that blood is a scarce resource and should be used wisely. Significant opportunities exist to achieve better use of blood and improve patient outcomes at the same time. To this end the Board has monitored the development of a national patient blood management strategy that is designed to take account of the influence particular policies have on blood use. A key element of the strategy is to facilitate participation by other authorities and organisations in order to address broader health concerns that affect the appropriate use of fresh blood components.
The review of the operation of the arrangements for the National Blood Agreement, which is required under the Agreement, is to evaluate the implementation of the Agreement and is scheduled for completion by June 2010. The Board has considered the NBA’s own assessment, which has identified where good progress has been made and where further opportunities lie. The delay in progressing the review has limited the NBA’s ability to finalise a suitable three-year corporate plan and has created a degree of uncertainty in determining the priorities and overall funding and purpose of the NBA in the future. As a consequence, the Board recommended that the current corporate plan be extended until the review is complete. The Australian Health Ministers Advisory Council accepted this. The current corporate plan is available at www.nba.gov.au/pubs/pdf/corp-06-09.pdf
During 2008–09 the Board continued with its program of stakeholder engagement. In August 2008 it invited Canberra-based senior health officials to a discussion of major issues in the blood sector. This provided an opportunity to discuss broad sector matters, particularly in relation to blood, and to obtain sector input into the role the NBA might have in driving, or supporting, a sustainable future, potential challenges it might face, and areas for reform.
The Board also met with the then Parliamentary Secretary, Senator the Hon Jan McLucas, in February 2008. This meeting afforded an excellent opportunity to discuss some major factors that might well affect future government policy in relation to blood.
Through its meetings and individual member contributions, the Board also provided input to a number of other core NBA activities, including:
The review of distribution arrangements for plasma and recombinant products, foreshadowed in my last report, has been progressing well and is expected to be completed on time. The Board has noted the findings of Phase 1 and was supportive of the exploration of options to identify possible efficiencies in a Phase 2 study.
The Board has strongly supported the work of the NBA in developing reliable data sources to inform its own activities and those of the sector more broadly. The success in bringing online two projects that should redress some of this information shortfall should not be dismissed lightly.
The Australian Bleeding Disorders Registry, which came on-line in December 2008, will provide an improved understanding of the nature of product demand and use as well as greater fidelity in supply forecasting and planning. There is no comparable register internationally, and the Board has strongly supported this development. Ultimately, the Registry should position Australia to be a leader in research into, and understanding of, trends in clotting factor use.
Another major project, the Integrated Data Management System, has been implemented in order to facilitate the supply and management of blood and blood-related products across core operational areas of the NBA. This includes budgeting and forecasting of supply and demand for blood and blood products, inventory and supply chain management, contract administration, and management of Financial Management and Accountability Act 1997 reporting obligations. The implementation is in its infancy, but early indications are that the system will provide crucial data that will deliver real and increasing benefits for the sector in the future.
Improved IT integration and data capability across the blood sector offers real potential to contribute towards sector reform. Developments undertaken by the Queensland Government for its Ordering and Receipting Blood System (ORBS) offer some of these opportunities. The potential for developing the National Intravenous Immunoglobulin (IVIg) Management System within the ORBS and/or the Australian Bleeding Disorders Registry framework, and further sector IT integration, was the subject of more detailed advice to the NBA by Board member Dr Peter Lewis-Hughes. The Board is now keen to explore options for a more integrated, IT-supported, innovative and broad approach to the overall management framework of blood products in Australia, including intravenous immunoglobulin.
A major focus for the Board is discharging our obligation to provide to the General Manager advice about the performance of the NBA. To assist in this, the Board receives regular and detailed reporting and operational feedback. I am pleased to report that the NBA has been able to continue to perform at a high level, delivering some 95 per cent of all planned activities within the operational plan, an increase of 14 per cent on the 2007–08 plan. The feedback reports demonstrate the extent of the activities undertaken by the NBA, progress with these activities, and the professionalism of staff in their dealings with stakeholders.
Looking to the new financial year, the Board is mindful of the challenges the NBA will face in the future. It is important that the capability and expertise that the NBA has built since 2003 is maintained. The Board believes that the NBA’s increased focus on data and understanding of demand drivers presents many opportunities for the organisation to continue to increase the value it provides to governments.
For 2009–10 the Board will specifically focus on:
Mr Garry Richardson
Chair
National Blood Authority Board