Our health system - and debt !

We have a totally unsustainable attitude to debt within the state health system. Our hospitals owe suppliers of goods and services a staggering $ 69 million and repayment is long outside the normal terms of trade.

What the government is trading on is the fact that suppliers know that eventually they will get paid - simply because the debtor is the government.

There is no possibility this tolerance would be extended to any other private debtor. It would be simply too risky. That private debtor could close their doors, file for bankruptcy and have debts that far exceed assets - something that is not a problem when the debtor is the government.

So we have a cat and mouse situation. The supplier denies supply to a hospital until the debt is reduced. The hospital system scrambled and scratches and manages to come up with a part payment. The goods are released - but the debt owing to someone else blows out because that money has gone elsewhere.

From the suppliers point of view there is no option other than to jack up the profit margin to try and recover profit lost by slow payment. It costs money to keep stock on the shelves and run a business. The whole concept of business revolves around the turnover of goods and their subsequent cash flow. When this is disrupted interest rates and bank charges start to destroy the viability of a business.

This level of debt by the health system is not a new phenomenon. It has been with us for years - and it is getting worse. We have had endless promises of relief from the government, but somehow the money never materialises - and the debts are getting bigger.

It is quite possible that this situation is costing lives. If operations are postponed because equipment and supplies are unavailable and if drugs to treat patients are in short supply - then there must be consequences.

What is becoming obvious is that running a health system is beyond the reach of state governments when it comes to finance.

Now is the time to bite the bullet and make the change that is overwhelmingly necessary. Hand health to the Federal government - the one with the deepest pockets - and end the duplication of state and territory health administrations that are sapping the money flow.

Time the states and the Feds faced reality - and ended this farce !