The Cost Allocation Implementation Statement (CAIS) provides an overview of how Ahpra has calculated the registration and accreditation fee component for practitioners with a principal place of practice (PPP) in NSW for FY 2020/21.
The Health Practitioner Regulation National Law Act 2009 (the National Law) sets out the guiding principles which require the scheme to operate in a transparent, accountable, efficient, effective and fair way and that the fees required to be paid under the scheme are to be reasonable having regard to the efficient and effective operation of the scheme.
On 13 November 2009, the Australian Health Workforce Ministerial Council resolved to give a Ministerial Council policy direction to Ahpra and the National Boards. The purpose of the policy direction was to clarify the financial arrangements that apply to registered health practitioners whose PPP is in the state of NSW. Fundamental to this directive is the notion that NSW registrants will not be required to contribute to the costs of running the national complaints scheme or that non NSW practitioners contribute to the costs of running the NSW complaint system.
This is because Part 8 (notifications) of the National Law in NSW is undertaken by the Health Professional Councils in NSW working with the NSW Health Care Complaints Commission (HCCC) in a co-regulatory partnership. Neither Boards or Ahpra manage notifications which arise in NSW.
The policy direction can be accessed on the Ministerial directives and communiques page.
The activities being costed are registration and accreditation functions under the National Law for practitioners with a Principal Place of Practice (PPP) in NSW.
Each year, the National Boards, in partnership with Ahpra, agree the national registration fee. Fees are set in order to meet the full costs of regulating each profession within the National Scheme without any government funding. Fees are published in the Health Profession Agreements between Ahpra and each National Board.
For practitioners with a PPP in NSW, the registration fee has two components. The first component related to the registration and accreditation functions. This is calculated by Ahpra.
The second component relates to the notifications function. This is calculated by the NSW Health Professional Councils Authority.
To the extent that the total of these two components is lower than the national fee, practitioners with a PPP in NSW receive a rebate in the form of a lower fee. If the total is higher than the national fee, practitioners pay a surcharge.
The agreed registration fee is collected as part of the annual registration renewal process administered nationally by Ahpra. The notifications component is remitted to the HPCA, on a monthly basis, for practitioners with a Principal Place of Practice in NSW, plus 33.33% of practitioners who do not register a Principal Place of Practice.
For financial year 2019/20, the total fees collected from NSW registrants were $67.13m; $37.13m was remitted to the HPCA.
All net full year budgeted costs are attributed to two categories - registration/accreditation associated functions and notifications related functions.
Shared services include compliance, professional standards and indirect costs. These are allocated to the registration/accreditation or notifications related functions based on their percentage share of the direct costs.
The NSW registration and accreditation function cost is then allocated pro-rata to professions based on a percentage allocation measure. This measure is set in the same way for each profession according to two factors.
The allocation measure for each profession is the value of these two factors combined using a 30% and 70% weighting respectively. The rationale for using an allocation measure is to more closely model effort required to complete the registration process and the accreditation process; therefore, linking costs associated with each of these functions.
Inclusion and exclusions sets out how we have defined direct and shared services and attributed costs to functions on a national basis.
The registration function ensures only practitioners with the skills, qualifications and suitability to provide safe care are registered to practise their profession.
The Registration function (direct costs) includes:
Working with accreditation authorities and committees ensures that individuals who are qualified for general registration in the profession have the knowledge, skills and professional attributes necessary to practise their professions.
The accreditation function (direct costs) includes:
Notifications teams in each state and territory office (except NSW) manage concerns that are raised about the health, performance or conduct of individual practitioners.
Notification function (direct costs):
Compliance function - Monitoring and auditing ensures practitioners are complying with the requirements placed upon them by the National Boards.
Direct costs include:
Professional Standards function - Providing policy advice to national boards to enable implementation of the scheme.
Direct costs includes:
Shared services includes enabling functions and services where effort is in support of the core functions:
The diagram of Schematic for Determining the Registration and Accreditation Fee can be obtained from the below link.
Table 1 provides an overview of the calculated registration and accreditation fee for each National Board for FY2018/19. Table 2 shows the national registration fee for each National Board and the fee for practitioners with a PPP in NSW.
Table 1: Overview of the general registration and accreditation fee for each profession FY 2020/21
Table 2: Overview of the national general registration fee for each profession FY 2020/21
Audited financial statements are published in the Ahpra annual report which is published every November on Ahpra’s website.
Ahpra’s data on registration and accreditation performance can be accessed on the statistics page on Ahpra’s website.
Activity Based Costing (ABC) aims to modernise our current way of allocating costs for our regulatory functions. Ahpra will test this new methodology during FY 2020/21 and will review potentially commencing its application in the budgeting period for FY 2021/22. Over time this will provide greater assurance for our approach to calculating the registration and accreditation fee for NSW.
The key principles that underpin this work are:
Ahpra will continue to review and refine the ABC methodology in the following ways:
Ahpra is also engaging with National Boards to implement a new approach to equity holding arrangements to promote financial sustainability. This work incorporates the design and implementation of Activity Based Costing (ABC).
The HPCA participates as an observer in the reference group which provides oversight and advice on the work on ABC and equity.