'I'm suffering like hell': Victorian hospitals missed 100,000 elective surgeries

ACM can reveal Victoria could have wiped out its elective surgery waiting list in a single year if public hospitals across the state had met their agreed targets.

Analysis by this masthead showed the state's major hospitals fell more than 200,000 activity units short of their contracted target in 2022-23.

That's equivalent to about 100,000 elective surgeries, or 150,000 hospital visits.

At the end of 2022-23 Victoria's elective surgery wait list stood at 71,322.

ACM can further reveal the state government let the hospitals keep the full funding for surgeries and care they never administered, totalling nearly $1 billion.

The operational funding for Victorian hospitals is measured in activity units called NWAU (national weighted activity units), which represent the average cost of a hospital activity.

A big operation like a knee or hip replacement might cost five units, while a simple colonoscopy would cost just 0.4 units.

At the start of the year each hospital signs a contract called a "statement of priorities" with the state government, committing to complete a certain number of units over that year.

The government then provides funding based on that promised activity output.

The government has a recall policy under which the hospitals have to pay back their funding if they fall short of their activity target.

But at the height of the COVID-19 pandemic the policy was suspended so hospitals weren't hit by funding shortfalls in the middle of a national emergency.

As Victoria's health system moved to COVID-normal, the government kept the recall policy suspended.

Experts told ACM it has left the hospitals completely unaccountable.

"To be frank, the [hospital] CEOs milked this thing for all it was worth," one senior public hospital executive said.

"In my opinion they saw it as an absolute golden ticket to do what you want, to not do work, to get paid for it, and to generate cash by doing nothing.

"It is literally getting paid for doing nothing."

The executive - who spoke anonymously - said without any consequences for missing their activity targets it was "only natural" that hospitals would fall short.

"The system doesn't have to be productive, so it isn't, and the downside of all of that is the human cost, which is massive," they said.

"It also means money is basically being blown down the toilet; it's crazy stuff and a crying shame for all Victorians."

Farmer and builder Alan Rundell is one of the tens of thousands of Victorians who have waited longer than they should for surgery.

From Heywood in the state's far south-west, he's due to travel three hours to Ballarat for complex hip surgery, but his procedure has already been cancelled twice.

"It's the pain level that's the trouble. It's excruciating," Mr Rundell said.

"I can't walk any great distance. I can't do anything except sit on my lawnmower and cut the grass - that's about all I can do."

The procedure is a "revision of hip replacement", which means replacing a previously replaced hip.

Mr Rundell said his old replacement had seriously deteriorated.

"When I first saw this orthopaedic surgeon in Ballarat he was that worried about it he said it needed urgent looking at," he said.

"The ball on the end of the replaced hip was obviously broken or something was seriously wrong."

When Mr Rundell first went on the wait list in August 2023 he was told the surgery would happen in January.

"I waited most of January for a phone call, but none appeared."

Finally, he rang to check and was told the surgeon was on leave until February.

Mr Rundell said he was scheduled for a phone call on March 7 to discuss a future date for the surgery. The phone call came early and he was told to prepare for surgery around the 7th.

But on the morning of March 5 the hospital called again to say the surgery had been cancelled and wouldn't happen until April at the earliest.

"I am absolutely gutted after that," Mr Rundell said, just minutes after getting the news.

Meanwhile the pain in his hip was becoming unbearable.

"I can't keep on taking these painkillers, but I have to just to keep it at a level that's manageable, that I can walk around," he said.

"I'm suffering like hell. I bomb myself out at night time just to be able to sleep. I have to double my tablets. I'm not supposed to, but I have to.

"I'm already addicted to it, I know, and it's only going to get worse the longer this goes on."

Mr Rundell said he was anxious to speak out, in case his surgery was postponed again.

"I feel a bit hesitant in talking to you because I fear retaliation, that they're just likely to bang me down even further," he said.

He said he was shocked to hear hospitals had been paid hundreds of millions of dollars for health care they never provided.

"If they'd done that work I wouldn't be in pain like I am, it would've been resolved long ago."

Dr Stephen Duckett, who designed the NWAU funding framework, said the government had completely mismanaged the system.

"Yes, that is true, [the hospitals] have been given funding for no output, but it's also about a lack of accountability," Dr Duckett said.

"The Department of Health appears to no longer be holding the hospitals to account, and every one of those patients who isn't treated is a patient who stays on the waiting list."

In 2022-23 the major hospitals fell nearly 206,000 activity units short of their end of year target. ACM shared its full analysis with the state government, which did not dispute the figures.

The senior hospital executive said much of the shortfall would have been driven by hospitals not performing the number elective surgeries they had promised.

Among the most common elective surgeries, cataract surgery generally costs between 0.8 and 1.9 units, a cystoscopy between 0.2 and 0.6 units, hernia repair between 1.1 and 2.1 units, and a hip replacement between 3.4 and 6.1 units, depending on how complex the surgery is.

The average NWAU for the most common elective procedures was just over two units, which meant the shortfall equated to about 100,000 missed elective surgeries between July 2022 and July 2023.

"You can see what this missed activity could have done to the wait lists," the hospital executive said.

"The number of procedures that have been forgone as a result of this is off the charts."

Grampians Health fell more than 7000 units short of its target, equal to about 3500 surgeries and $33.9 million the hospital kept for work it didn't do.

Bendigo Health fell nearly 10,000 units short, the equivalent of more than 4500 surgeries and $42.7 million.

Goulburn Valley Health in Shepparton was the worst performer in regional Victoria, missing its target by more than 13,000 units, equal to more than 6000 surgeries and $61 million.

Bendigo Health also paid financial consulting firm Ernst & Young $120,000 for "NWAU funding consultation".

ACM asked what the purpose of the consultation was, but Bendigo Health refused to say.

But some hospitals showed it was possible to meet, or nearly meet, their activity targets.

Albury Wodonga Health fell just 230 units short for the year, while Mildura Base Public Hospital fell 43 units short.

Two Melbourne hospitals - Peter MacCallum Cancer Centre and Northern Health - exceeded their targets for the year.

ACM asked the CEOs of the worst-performing regional hospitals to explain to their local community why they failed to deliver the health care they had promised.

Only Goulburn Valley Health provided a response:

"GV Health acknowledges meeting activity targets relies on having a full workforce and there have been significant health worker shortages over the past 12 months, especially at our health service," the response read.

"We're doing everything we can to fill those shortages, and our workforce is at the heart of our new strategic plan.

"Despite these challenges, our GV Health staff continue to go above and beyond to deliver exceptional regional healthcare for the communities we serve."

The state government said COVID-19 and the former federal government were to blame for the massive shortfall in care.

"Health systems around the world have faced extraordinary demand following the once-in-100-year pandemic and in 2022-23 on any given day in Victoria more than 500 hospital beds were required for patients with COVID-19 - this meant there were some areas of lower than expected activity," a government spokesperson said.

"After a decade of neglect by the former federal Coalition government, our country's broken primary care system is placing significant pressure on hospitals as a result of deferred care - patients are arriving sicker and staying in hospital longer, and this is having a flow-on effect to hospital activity."

The spokesperson said that "unique set of circumstances" had "had an impact on activity targets", but said healthcare workers were "working harder than ever before".

Health Minister Mary-Anne Thomas told ACM the pandemic had put "unprecedented pressure on operating costs and workforce".

"That is why we've made record investments to support, retain and grow our frontline medical staff," Ms Thomas said.

ACM asked the minister to comment on the alleged lack of accountability from the hospitals, government mismanagement, and whether the hospitals were on track to meet their targets in 2023-24.

The minister did not address the questions.