Outcome Based Management

Generating PDFGenerating PDF

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 Director General (DG) of the Department of Health is the System Manager responsible for the overall management, strategic direction and stewardship of the WA health system. The DG will use policy frameworks to ensure a consistent approach to a range of matters undertaken by HSPs. Policy frameworks must be complied with and implemented as a part of ongoing operations.

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

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:

*Any mandatory requirement document that references the Hospitals and Health Act 1927 must be interpreted as a requirement under the Health Services Act 2016.

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 Effective to Amendment(s)
1 1 July 2017 6 December 2017 Original Version
2 6 December 2017 9 May 2018 Major Amendment to MP 0054/17
3 9 May 2018 28 June 2018 Major Amendment to MP 0054/17
4 28 June 2018 21 March 2019 Major Amendment to MP 0054/17 and publication of MP 0090/18
5 21 March 2019 Current Major Amendment to MP 0090/18 - see policy page for further details


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.