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Outcome Based Management

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Policy framework statement

The Outcome Based Management (OBM) Policy Framework specifies the requirements that all Health Service Providers (HSPs) must comply with in order to ensure the integrity of the OBM Framework.

Purpose

The purpose of this policy framework is to ensure:

  • a clear understanding of the governance, roles and responsibilities for OBM
  • the integrity of the OBM Framework across the WA health system
  • the alignment of public system performance reporting with agreed State Government priorities and outcomes
  • the consistency of OBM Key Performance Indicators (KPIs) in annual reports and Government Budget Statements
  • the validity and reliability of OBM KPI data reported
  • the effectiveness and currency of the OBM cost centre mapping. 

Applicability

This policy framework applies to, and is binding on HSPs to which it applies or relates. Specifically, Health Service Provider Boards and Health Service Provider Chief Executives.

Principles

OBM describes how outcomes, services and KPIs are used to measure WA health system’s performance against agreed State Government priorities and desired outcomes. The key principles that underpin this policy framework are:

Transparency
Transparent reporting of performance against agreed outcome targets.

Accountability
Clearly defined roles and responsibilities to achieve agreed outcome targets.

Recognition
Acknowledgement of performance against agreed outcome targets.

Consistency
Consistent systems to support the achievement of agreed outcome targets.

Integration
Integrated systems and policies to support the achievement of agreed outcome targets.

Legislative context

This policy framework is made pursuant to ss 26(2)(d) of the Health Services Act 2016.

The Health Services Act 2016 refers to policy frameworks in ss. 26-27 and s. 34(2)(c). Other relevant parts in the Act that relate specifically to this policy framework include s. 20(1)(b) which refers to the function of the Director General to provide strategic leadership and direction for the provision of public health services in the State.

The Financial Management Act 2006 requires all State Government agencies to prepare annual reports that contain KPIs. The Government Financial Responsibility Act 2000 and the National Health Reform Act 2011 outline key legislative requirements. Budget setting is a key component of the OBM process. The State Budget papers are supporting documents to the Appropriation Bills.

The Treasurer’s Instruction 904 prescribes the mandatory reporting requirements for OBM for public sector agencies in WA. The instruction requires the disclosure of performance information including OBM KPIs in agency annual reports.

Mandatory requirements

Under this policy framework HSPs must comply with all mandatory requirements* including:

Policy framework custodian

Assistant Director General
Purchasing and System Performance Division

Enquiries relating to this Policy Framework may be directed to: PolicyFrameworkSupport@health.wa.gov.au

Review

This policy framework will be reviewed as required to ensure relevance and recency. At a minimum this policy framework will be reviewed within two years after first issue and at least every three years thereafter.

Version Effective from Amendment(s)
22 18 April 2024 Amendment to MP 0115/19 Outcome Based Managment Policy.  Related document 2023-24 OBM KPI Data Definition updated to align with the 2023-24 OBM framework. 
21 15 December 2023 Amendment to MP 0115/19 Outcome Based Management Policy. Amendment to Addendum 1: 2023-24 OBM KPIs and Targets – Note 2 on Page 1 amended to state that the targets will be updated by February 2024.
20  7 September 2023 Amendment to MP 0115/19 Outcome Based Management Policy.  Amendment to Addendum 1: 2023-24 KPIs and Targets - Efficiency KPIs included for Outcome 2-Service 6, No. 36. (page 2). 
19  28 July 2023  Amendment to MP 0115/19 Outcome Based Management Policy. Inclusion of related documents:  Addendum 1:  2023-24 KPIs and Targets and Addendum 2: 2023-24 Service, Sub-Service and Programs.  Removal of Addendum 1: 2022-23 and Addendum 2: 2022-23 and moved to policy landing archived section. 
18 21 July 2023  Related Document Addendum 1 2022-23 KPIs and Targets updated to include Outcome 1 Efficiency KPIs (Service 4) and Outcome 2 Effectiveness KPIs (#17 - DOH).
17  9 May 2023 Minor amendment to MP 0115/19 Outcome Based Management Policy. Amendment to related document: 20232-23 OBM KPI Data Definition Manual to include the mental health targets in the recently updated related document: Addendum 1. 
16  4 May 2023  Amendment to MP 0115/19 Outcome Based Management Policy.  Amendment to Addendum 1: 2022-23 KPIs and Targets - updated to reflect the mental health efficiency KPIs for all health service providers excluding South Metropolitan Health Service. 
15  28 April 2023  Amendment to MP 0115/19 Outcome Based Management Policy. Amendments include the following:  Insertion of contracted health entity applicability statement, removed definition for WA health system definition, inserted WA health entities definition and replaced all WA health system references to WA health entities, removed 2021-22 Outcome Based Management Key Performance Indicator Data Definition Manual and inserted 2022-23 Outcome Based Management Key Performance Indicator Data Definition Manual. 
14  21 December 2022 Minor amendment to MP 0115/19 Outcome Based Management Policy.  Updated statement to Related Document- Addendum 1 and includes 'Purchasing decisions for Mental Health Services have not been finalised at the time of publishing the 2022-23 targets.  The targets will be updated by February 2023 and published on the WA Health OBM website.'
13  9 September 2022 Amendments to MP 0115/19 Outcome Based Management Policy.  Combined Department of Health and Health Service Providers in the one consolidated Policy.  Included Department of Health within Applicability, Policy Requirements and Compliance Monitoring sections. Amended title to remove financial year.  Removed 2021-2- Addendum 1 and 2 as Related Documents.  Removed 2019-20 OBM KPI Data Quality Statement as Supporting Information. 
12 9 August 2022 Amendment to MP 0115/19 Outcome Based Management Policy 2019-20. Related Document Addendum 1: 2022-23 OBM KPIs and Targets added to Policy to reflect targets updated in alignment with Government Budget Statement process. Related Document Addendum 2: 2022-23 OBM Service Sub-Service Programs added to Policy to reflect 2022-23 amendments. 
11 10 May 2022 Amendment to MP 0115/19 Outcome Based Management Policy 2019-20 Related Document; OBM KPI Data Definitions Manual. Updated Related document title to OBM KPI Data Definitions Manual 2021-22. Minor wording amendments or revisions made to align with current service delivery.  This includes changes in governance, opening/closure of specific words, changes to data sources and data custodians and updates in alignment with national definitions. 
10 24 November 2021 Amendments to Related Documents Addendum 1 and Addendum 2 for MP 0115/19 Outcome Based Management Policy 2019-20.
9 26 May 2021
 Major Amendment to Related Documents Addendum 1 and Addendum 2 for MP 0115/19 Outcome Based Management Policy 2019-20 .
8 26 June 2020
 Major Amendment to MP 0115/19 Outcome Based Management Policy 2019-20, Related documents and Supporting information. See document control section of policy for details.
7 30 July 2019
 Major Amendment to MP 0090/18 Outcome Based Management Policy 2018-19, Related documents and Supporting information. See document control section of policy for details.
6 19 July 2019
 MP 0115/19 Outcome Based Management Policy 2019-20.
5 21 March 2019
 Major Amendment to MP 0090/18 Outcome Based Management Policy 2018-19 - see policy page for further details.
4 28 June 2018
 Major Amendment to MP 0054/17 Outcome Based Management Policy 2017-18 and publication of MP 0090/18 Outcome Based Management Policy 2018-19.
3 9 May 2018
 Major Amendment to MP 0054/17 Outcome Based Management Policy 2017-18.
2 6 December 2017
 Major Amendment to MP 0054/17 Outcome Based Management Policy 2017-18.
1 1 July 2017 Original Version

Approval

This policy framework has been approved and issued by the Director General of the Department of Health as the System Manager.

Approval byDr D J Russell-Weisz, Director General, Department of Health
Approval date23 June 2017
Date published28 June 2018
File numberF-AA-42151

Compliance

This policy framework is binding on those to whom it applies or relates. Implementation at a local level will be subject to audit.

Glossary of terms

Term Meaning
Key Performance Indicator A measurable value that demonstrates the effectiveness and efficiency of the services delivered.
Outcome Based Management Describes how outcomes, services and KPIs are used to measure WA Health's performance against agreed State Government priorities and desired outcomes.
Service Agreement The annual Agreement between the Director General of the Department of Health and the Health Service Providers. The agreement will include a Statement of Priorities directing policy, service targets, budgets and performance measures as performance indicators.
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