2017-2018 Annual Report OUR VISION OUR VALUES GREAT CARE, PATIENTS FIRST EVERYWHERE, KINDNESS EVERY TIME RESPECT OUR MISSION EXCELLENCE AGILITY TOGETHER WE CARE, LEARN, DISCOVER HUMILITY AND INNOVATE

EASTERN HEALTH CATCHMENTS

Glenburn Buxton Woods Point

Kinglake Marysville

Narbethong Cambarville Matloc

Steel Cree Chum Creek

Healesville Hospital Yarra Glen and Yarra Valley Health Reefton Kangaroo Ground Eltham

Warrandyte Toorongo Templestowe Yarra Ranges Health Warburton Wandin Woori Yalloc Kew Box Hill Hospital Maroondah Hospital Peter James Centre Hoddles Cree Glen Iris Wantirna Health Olinda Powelltown Emerald Angliss Hospital Mulgrave Rowville Lysterfield Gembrook Localities Upper Beaconsfield Eastern Health Precincts Primary Catchment Garfield Secondary Catchment

Eastern Health acknowledges the traditional custodians of the land upon which our health service is built, the Wurundjeri people, and pays our respects to their elders past and present. Since it was established in 2000, Eastern Health has played a key role in the provision of public health services in Melbourne’s eastern and outer eastern suburbs. It works with community healthcare providers, such as general practitioners, community health services and affiliated healthcare agencies. Geographically, Eastern Health covers the municipalities of Boroondara, Knox, Contents Manningham, Maroondah, Board Chair and 02 Whitehorse and Chief Executive Finance Committee Chair 04 Yarra Ranges. and Chief Finance Officer 2017-18 at a glance 06 Our Strategy 07 RESPONSIBLE BODIES ABOUT US 09 DECLARATION Who we are 10 Clinical programs 11 In accordance with the Financial and services Management Act 1994, I am Occupational health 12 pleased to present the report of and safety operations for Eastern Health for the Annual highlights 14 year ending 30 June 2018. OUR PERFORMANCE 15 Strategic priorities 16 Performance against 17 strategic priorities Andrew Conway High quality and safe care 26 Chair Timely access to care 27 Effective financial 27 Eastern Health Risk and Audit The Annual Report 2017-18 management Committee provides information about Eastern Strong governance, 28 Health’s sites, services, staff and 9 August 2018 leadership and culture operational achievements and Activity and funding 29 challenges during the financial year. MANNER OF Environmental performance 30 ESTABLISHMENT This report should be read in Statutory compliance 31 conjunction with Eastern Health’s Challenges and opportunities 34 As a public health service other annual publications: established under section 181 OUR GOVERNANCE 35 of the Health Services Act 1988 Quality Account 2018, which Organisational structure 36 (Vic), Eastern Health reports to reports Eastern Health’s progress Board of Directors 37 the Victorian Minister for Health, and achievements in providing Board committees 39 the Hon Jill Hennessy MP, and safe, high-quality care. Executive 41 the Victorian Minister for Mental Turning Point 2018, which Health, the Hon Martin Foley, Eastern Health Foundation 42 through the Department of Health showcases the statewide service’s and Human Services. The functions extensive work in alcohol, other OUR PEOPLE 43 of a public health service Board drugs and gambling research, Working at Eastern Health 44 are outlined in the Act and include treatment and education. Workforce data 46 establishing, maintaining and Eastern Health’s publications Disclosure index 49 monitoring the performance of are available on its website at systems to ensure the health FINANCIAL STATEMENTS 51 www.easternhealth.org.au service meets community needs. 2017-2018 The Annual Report 2017-18 will VAGO statement 54 be presented to the public at Eastern Health’s annual meeting Glossary 112

on 29 November 2018. Index 114 Report 2017-2018 Annual Health Eastern

01 Our Board Chair and Chief Executive

A major achievement in 2017 was the launch of the Strategic Plan 2017-2022, which sets the direction, vision, mission and values for Eastern Health.

This plan emphasises staff safety Analysis has shown that the In March 2018, Eastern Health in recognition of increasing majority of this growth was at successfully underwent an organisation- occupational violence and Box Hill Hospital, which experienced wide accreditation survey to confirm its aggression, and articulates an 11 per cent increase in category compliance with the 15 EQuIP National the Eastern Health values of 1 and 2 presentations in 2017-18, Standards, 10 National Standards for patients first, kindness, respect, compared with the previous year, Mental Health Services and four Human excellence, agility and humility. while Maroondah Hospital experienced Service Standards. The Australian See page 7 for more information. a seven per cent increase. Overall, Council on Healthcare Standards there was a 5.5 per cent increase awarded full accreditation to Eastern In 2017-18, Eastern Health’s services (or 2435 more) in patients arriving continued to grow as did the number of Health, which met all the requirements. at our emergency departments via See page 24 for more information. people accessing treatment and care. ambulance, including a seven per cent With 1.32 million episodes of increase at Angliss Hospital. patient care (up 6.9 per cent) placing This demand translated into an BUILDING FOR THE enormous strain on the system, our additional 513 admissions from our FUTURE staff continually responded to the emergency departments to inpatient challenges, putting their patients first beds, primarily in General Medicine, There were a number of major building and providing safe, high-quality care. Specialty Medicine and Mental Health, projects underway across Eastern Health in 2017-18. The new $20 million Last winter, Victoria experienced one of which added pressure on available beds. critical care and short-stay expansion the worst and most protracted influenza at Angliss Hospital was completed, seasons in decades. The influenza with the new Intensive Care Unit being period generally lasts three to four CHECKS AND BALANCES commissioned in October 2018. months but in 2017, it began in May Our robust quality systems for and did not end until November. monitoring patient safety were evident The Victorian Government provided when in late 2017 they identified an At Eastern Health, confirmed cases of $10 million for the construction of a increase in pressure injuries at Box influenza were 31.6 per cent higher breast and cancer centre at Maroondah Hill Hospital. This resulted in a range than at the same time the year before. Hospital, which is stage one of an of strategies being implemented to The sustained, high number of medical integrated cancer centre. Construction immediately address the issue, including emergency presentations, combined was completed in February 2018 and the decision to replace the entire bed with the need to keep a large number the centre comprises 89 treatment and stock. Patient safety is paramount at of patients isolated in single rooms diagnostic spaces, bringing together Eastern Health and the decision to and high levels of staff sick leave, under one roof Eastern Health’s replace the beds was made to minimise placed significant pressure on access cancer, surgical and medical imaging the risk of harm to our patients. for patients seeking admission at all services, as well as BreastScreen our sites. Following the tragic death of a staff Victoria (East Ringwood), which screens member in June 2017, staff safety about 10,000 women each year. As a result, a large number of patients and strategies to reduce occupational scheduled for elective surgery were violence and aggression were the focus A shortage of car parking at Maroondah cancelled in July and August 2017. of considerable effort, led by the new Hospital has been a long-standing Despite this, a record 17,590 elective Occupational Violence and Aggression issue and the planned construction of surgeries were performed in 2017-18. Taskforce. Security staff numbers a 542-space multi-deck car park has Demand in the three emergency increased and a range of initiatives progressed, with financial arrangements departments continued to increase in were implemented to provide staff with for the project assisted by a grant of both overall numbers and the acuity a safe and secure working environment $2 million from the Commonwealth of patients who presented, severely and to also ensure the safety of patients Government’s Community Development stretching our bed capacity and ability and visitors. This work is continuing. Programme Fund. to meet time to treatment targets. See page 12 for more information.

02 “OUR STAFF CONTINUALLY RESPONDED TO THE CHALLENGES, PUTTING THEIR PATIENTS FIRST AND PROVIDING SAFE, HIGH-QUALITY CARE.”

Eastern Health Board Chair Dr Joanna Flynn AM and Chief Executive Adjunct Professor David Plunkett.

Victoria’s Department of Health EMR IMPLEMENTATION and Human Services has committed $6.5 million for the capital works During 2017-18, Eastern Health required to establish a new MRI implemented one of the largest and Nuclear Medicine service at Electronic Medical Record (EMR) Box Hill Hospital. This will be owned solution suites in Australia and the and operated by Eastern Health and largest Cerner EMR solution suite in any will improve access to these crucial metropolitan health service in Victoria. services for people living in the The extent of the change in practice and Another focus will be implementation eastern metropolitan region. processes was profound. However, the of the People Strategy 2018-2022, On 18 June 2018, Eastern Health efforts involved and the challenges for which aims to create an environment commissioned a new eight-bed staff in adopting the single largest change in which Eastern Health employees Addiction Medicine Unit (Rapid to clinical work practice and processes for can flourish and succeed in delivering Withdrawal Unit) at Box Hill Hospital, many years should not be underestimated Eastern Health’s vision of “great care, everywhere, every time”, embed the which complements a new model and all those involved in the successful Eastern Health values and help to ensure of care for clients undergoing drug implementation of the EMR deserve to be applauded. that the health service operates as safely, and/or alcohol detoxification at efficiently and effectively as possible. Wellington House in Box Hill. See page 44 for more information. DEPARTURES AND Eastern Health is the first health This financial year has been very service in Australia to develop this APPOINTMENTS challenging but despite increased innovative residential Alcohol and Ms Joanna Walker and Dr Peter Dorhmann demand for services, it has been Other Drug treatment that can were welcomed to the Board of Directors a successful one. Eastern Health provide enhanced withdrawal and from 1 July 2017 and Prof Andrew Conway appreciates the ongoing support of stabilisation support for Victorians. was reappointed to the Board on 1 August the Department of Health and Human 2017 for a further three-year term. Services, the Minister for Health, the FINANCIAL On 30 June 2018, Prof Pauline Nugent and Hon Jill Hennessy, and the Minister for Mr Stuart Alford retired from the Board Mental Health, the Hon Martin Foley. SUSTAINABILITY after nine years of outstanding service. We would also like to acknowledge the ongoing efforts of the Board of Directors, Despite its best efforts, Eastern From 1 July 2018, Board Chair Dr Joanna the Executive team, staff and volunteers Health did not meet its financial Flynn AM was reappointed for an additional for their work and the contribution targets in 2016-17 and the Board, one-year term, Mr Tass Mousaferiadis they have made to the delivery of safe, management and staff worked was reappointed for a further three-year high-quality care for patients. exceptionally hard to restore term and Ms Felicity Pantelidis and We look forward to continuing to live financial stability and achieve a Mr Andrew Saunders were appointed our values and achieving our vision for break-even result in 2017-18. to the Board for three-year terms. the future: “Great care, everywhere, Managers worked to improve every time”. our financial sustainability while LOOKING FORWARD continuing to provide safe, Dr Joanna Flynn AM high-quality care for increasing The security of information held by Chair numbers of patients. This pleasing Eastern Health is a priority. Continually Eastern Health Board financial result is the culmination of improving cyber security is a focus for the those efforts and everyone involved future and with financial assistance from Adjunct Professor David Plunkett should be commended. the Department of Health and Human Services, Eastern Health will continue to Chief Executive

upgrade its cyber security technology. Eastern Health Report 2017-2018 Annual Health Eastern

03 Finance Committee Chair and Chief Finance Officer

Eastern Health’s total comprehensive result for 2017-18 is a $47.807 million surplus, which takes into account capital purpose income, land and building Board Director and Finance Committee revaluations and depreciation. Chair Stuart Alford and Chief Finance Officer Peter Hutchinson.

Capital income for the year is continued delivery ofmuch-needed The 2017-18 financial year also $55.6 million for the completion services to our community. All patient delivered the lowest unplanned of various projects, including treatment areas met or exceeded absence in many years and the wellbeing of staff was supported the Angliss Hospital expansion, 100 per cent of nominated funding targets for the year. with annual leave taken at higher Electronic Medical Record, levels than recent years. Eastern Health Breast and Cancer In a year with continued pressure Centre and Box Hill Hospital to grow our services, it was terrific to Eastern Health operates three residential aged care facilities and an refurbishment, as well as funds for limit the increase in operating costs to slightly less than five per cent, which aged person’s hostel at four locations additional medical equipment and across the catchment. information technology projects. significantly contributed to the delivery of the modest surplus. The segment reporting illustrates A management revaluation of buildings the favourable net contribution of The main increase in expenditure was was completed at year end and $463,000 for the aged care facilities in employee costs (six per cent) due resulted in the organisation realising and a $362,000 deficit for the aged to growth in acute inpatient activity an increase in value by $61 million, person’s hostel respectively. The poor and a number of enterprise bargaining based on the Valuer-General’s indices. result in the hostel was driven by agreements that covered previous A full revaluation of all buildings will lower occupancy levels at times periods. These salary increases be completed in 2018-19. during the year. involved some back-pay arrangements that increased employee costs. No events or matters have arisen OPERATING SURPLUS since the year-end balance date that have resulted in any significant effect MEETS TARGET MANAGING OUR COSTS on the operations of the organisation. The net result before capital and specific Eastern Health’s management Our commitments for expenditure, items is a surplus of $190,000. This was team, as in prior years, prepared a reported in the notes to the financial the planned outcome, which was to comprehensive operating budget statements, illustrate a continuation break even, and has occurred as a result program for revenue and expenditure, of building plans and investment of Eastern Health benefitting from a accompanied by detailed activity in communication and information combination of growth funds to support schedules for monitoring bed technology infrastructure, supporting increased services and close monitoring management, specialist clinics and a sound foundation for Eastern of staffing and consumable costs. elective surgery. Health to continue providing positive The operating result delivers the health experiences for people and Considerable effort was also directed outcome the Board of Directors signed communities in the east. at the identification of sustainable in the Statement of Priorities with the efficiencies through an overall Minister for Health for the 2017-18 Stuart Alford Economic Sustainability Strategy. financial year. Chair While ensuring we continued to Finance Committe meet legislative requirements, we (Appointment expired 30 June 2018) CONTINUING DEMAND delivered a number of efficiencies, FOR SERVICES including improving the staffing mix Peter Hutchinson and reducing the use of agency nurses Operating revenues grew by nearly six Chief Finance Officer to an all-time low. per cent, as forecast, and enabled the Eastern Health 04 168,898 “OPERATING REVENUES GREW BY emergency department NEARLY SIX PER CENT, AS FORECAST, presentations – highest AND ENABLED THE CONTINUED on record DELIVERY OF MUCH-NEEDED SERVICES TO OUR COMMUNITY.”

Summary of financial results

2018 2017 2016 2015 2014 Board Director and Finance Committee Chair Stuart Alford and Chief Finance $000 $000 $000 $000 $000 Officer Peter Hutchinson. Total revenue 1,070,437 1,008,430 933,199 880,049 986,530 Total expenses 1,083,638 1,038,198 955,856 881,954 821,846 Other operating flows included 16 1,246 (727) - - in the net result for the year

*OPERATING RESULT 190 (8,439) 299 71 792 Total assets 1,033,253 950,222 945,025 931,240 918,797 Total liabilities 308,550 273,542 251,834 234,361 224,265

NET ASSETS 724,703 676,680 693,191 696,879 694,532

TOTAL EQUITY 724,703 676,680 693,191 696,879 694,532

* The operating result is the result for which the health service is monitored in its Statement of Priorities, also referred to as the Net result before capital and specific items.

Sources of revenue Operating expenses Expenses by services

5% Capital purpose 11% Mental income 15% Supplies and health consumables 4% Other operating 8% Emergency revenue 10% Other operating 4% Corporate costs 5% Patient fees 2% Aged care 3% Recoupment of 6% Depreciation and private practice fees amortisation 2% Ambulatory care 83% Government grants 69% Employee costs 73% Acute Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern Our full financial statements start on page 51. 05 At a glance

Our performance

1,327,468 4797 38,037 episodes of patient care – babies born – one baby operations – a record up 6.9% or 85,978 every 108 minutes 17,590 were elective more episodes surgeries

47,711 168,898 ambulance arrivals to 265,107 emergency department our three emergency specialist clinic presentations – up 1.4% – departments – average appointments – up that’s one person every 84% of patients transferred 2.6% or 6620 more 3.1 minutes within 40 minutes appointments

Our financial Our people Our community position

78% 870 Operating result – volunteers $190,000 contributed surplus 208,000 Total revenue – hours of service $1.07 billion Total expenses – 22% $285,000 raised by our auxiliaries $1.08 billion Net assets – $500,000 percentage of women and donated for research $700 million men in the workforce 06 GREAT CARE, EVERYWHERE, EVERY TIME

KINDNESS Healthcare excellence

RESPECT Leading in learning EXCELLENCE PATIENTS FIRST Leading in research and innovation AGILITY

A values-based, HUMILITY safe workplace

A HIGH-PERFORMING ORGANISATION

Together we care, learn, discover and innovate

STRATEGIC INITIATIVES Eastern Health’s Strategic To deliver on our vision over the Plan 2017-2022 will guide us next five years, Eastern Health will Healthcare excellence through the current and future focus its efforts around four strategic initiatives and associated priority Great patient outcomes challenges of a growing and ageing population, a rapidly- goals (left). These strategic initiatives Great patient experiences changing digital environment have been determined after careful Harm-free care and financial responsibility to consideration of the environment in which we operate, the challenges we live within our means. Leading in learning expect to face and the capabilities At Eastern Health, the term “great” and opportunities we have. Great learner outcomes symbolises not just the experience Great learning experiences and outcome of care but also the Our values also represent a transition A dynamic learning organisation systems of healthcare that support for Eastern Health in its approach our staff and our patients to to driving healthcare excellence. Leading in research experience great care, everywhere, It is the first time in 17 years that and innovation every time.This vision statement our organisation’s values have been is embedded in our daily language reimagined. Innovating for performance to guide the work of our teams excellence and represent the aspiration of The decision to revise the values was made specifically in response to Renowned for research our organisation. feedback from our staff about what is Translating research evidence Our mission is wide-ranging and important to them and what kind of and innovation to enhance care encompasses the three business work environments will help them to fields in which we operate every day. thrive. By living these values every A values-based, safe These are the delivery of healthcare day the Eastern Health team will services, education to those in, demonstrate “patients first”. workplace or aspiring to join, the healthcare Safe workplace for all workforce and research into See page 8 for the behaviours that High-performing leaders healthcare and its delivery. underpin each value.

Engaged and empowered Report 2017-2018 Annual Health Eastern people and teams 07 OUR VALUES Respect

Our values reflect our I recognise the rights and dignity of patients, relatives, understanding that, at its most carers, colleagues and members fundamental level, healthcare is of the community. ENABLING OUR about people caring for people. SUCCESS The way we work together in I seek and take into account others’ healthcare teams and with experiences and viewpoints. Eastern Health is committed patients, their families and I have appropriate regard for my to being a high-performing our communities, requires us own worth. organisation. This builds to be kind, respectful, agile I acknowledge and respond to on our past successes in and humble, and to strive for individual and group differences. improving the systems excellence in all that we do. and processes we use, and

I value the people I work with and ensures the safety and As we live these values each day, our the work they do. work environments are characterised reliability of the care we deliver. by respectful and supportive Excellence relationships between staff and Eastern Health understands that I strive to be the best I can be. with our patients and their families. this commitment to performance These values represent and describe I prioritise safety and act safely. excellence and the discipline the very heart of our organisation of continuous improvement I deliver high standards of service and what we stand for. underpin our performance. and clinical practice. Eastern Health staff have identified We apply this discipline to all the behaviours we will demonstrate I seek, act on and provide parts of our organisation, every for each value and for which we hold constructive feedback. day, and it is this commitment and consistency that enables ourselves to account. I embrace and promote best our success. practice. Patients First Along with our commitment I am curious, questioning and I place patients’ needs and to performance excellence, learning all the time. preferences at the centre of through the Strategic Plan we my work. I go beyond what is expected. have confirmed the specific enablers of a high-performing I include the patient in all aspects I come to work to make a difference. organisation. These include: of their care, seeking their input,

keeping them informed and Agility Operating systems that involved in regular communication. create value I have a "can do" attitude.

I take the time to get to know our Strategic partnerships I am always looking for smarter, patients and what matters to them. Digital transformation better ways to do things. I communicate using plain language, A diverse and secure I am flexible and responsive to ask open questions and paraphrase workforce changing and different needs. to check that I understand. Visibility of performance I am willing to try something I listen, I hear and I respond. different. Continued development of capital infrastructure Kindness I think critically and respond rapidly. and equipment. I am welcoming, I smile and am Humility Eastern Health has a number inviting in tone and body language. of enabling plans that drive

I prioritise making people feel I am approachable and seek achievement of our strategic comfortable. feedback. intent. These plans are outlined in Section 5 of the Strategic I am honest and own my mistakes. I am caring, thoughtful and patient. Plan, which is available on the

I say thank you and engage I leave my ego at the door and Eastern Health website at in supportive, meaningful put myself in the patient’s shoes. www.easternhealth.org.au. These plans will be reviewed conversations. I do not think less of myself but and updated to support progress I think of myself less. I look for opportunities to over the life of the Strategic Plan. demonstrate acts of kindness. I model being a member of the I strive to meet a person’s personal team as much as being a leader. and clinical needs. To learn more about how we live our values every day, watch the “Be part of our story” video on our website at www.easternhealth.org.au 08 Caring for 788,260 people

Services located across 2816 square Eastern Health delivers care across the continuum, from health kilometres – the largest geographical area promotion and disease prevention to interventions for some of the of any metropolitan health service in Victoria most complex conditions and critically unwell patients. eWe ar 1510* beds – 7 hospitals and 3 emergency ableo t do this effectively through the integration of clinical care departments with high-quality education and robust research. Our services are Annual operating budget of$1.01 billion delivered from eight precincts and in some instances, directly – this equates to $1931 per minute into people’s homes. Pictured is Box Hill Hospital Emergency We have 9430 employees, 65 per cent Department Nurse Kate Deloro. Kate is one of 3800 nurses who of whom live within the community we serve work across Eastern Health. We also have 370 midwives. *As at 30 June 2018. Bed numbers are subject to change depending on activity and demand. About Us Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

0915 Who we are

Eastern Health is one of Melbourne’s largest metropolitan public health services. We provide a range of emergency, surgical, medical and general healthcare services, including maternity, palliative care, mental health, drug and alcohol, residential care, community health and statewide specialist services to people and communities that are diverse in culture, age, socio-economic status, population and healthcare needs.

Eastern Health is committed Compared with Victorian rates, a larger Eastern Health experiences greater to developing and delivering percentage of people (26.7 per cent) demand for its emergency, inpatient services that meet the needs and speak a language other than English at and ambulatory care services per home, including Mandarin, Cantonese, 100,000 head of population than expectations of our diverse and Greek, Italian and Vietnamese. most other health services. growing community. We invest a lot of time and effort to understand Yarra Ranges has a higher than We are focused on delivering Victorian average number of people performance excellence in everything our community and how it changes we do, across all aspects of care. over time. who identify as Aboriginal or Torres Strait Islander while overall, the This ethos also helps us to attract There are 788,260* people who live Eastern Metropolitan Region has a and retain the best staff. We have within our primary catchment area proportion below the Victorian an active education and research and a further 328,438 people residing average (0.4 per cent locally compared program, and strong affiliations with within our secondary catchment area with 0.8 per cent in Victoria). some of Australia’s top universities and educational institutions. (see map on inside cover). We have It is estimated that 11 per cent of 9430 employees, 65 per cent (or 6129) people in the area are of diverse sexual * Source: Victoria in Future 2016 of whom live within the community orientation, sex or gender identity we serve. and identify as lesbian, gay, bisexual, Eastern Health In comparison to Victoria, the Eastern transgender and/or intersex. Organisational Profile Metropolitan Region has a lower Patients who come to Eastern Health proportion of people born in Australia seek care for a range of health Larger sites and a higher proportion of people born conditions. Eighty-one per cent of in non-English speaking countries, with admissions to our hospitals are people Angliss Hospital almost 25 per cent of the population who live within our primary catchment Box Hill Hospital born in a non-English speaking country. area. The largest volume of admitted Healesville Hospital and The largest proportions of these people activity is for haemodialysis, which Yarra Valley Health were born in China, India, Malaysia collectively accounts for one quarter of Maroondah Hospital and Italy. all patient admissions to Eastern Health. Peter James Centre Wantirna Health Yarra Ranges Health This graph shows primary catchment demand for the top Major Clinically-Related Groups and the source of admissions to Eastern Statewide services Health from the primary catchment area (excluding haemodialysis). Spectrum Turning Point Yarra Ranges Manningham 8,000 Corporate functions Whitehorse Knox Maroondah Boroondara Information, Technology and 6,000 Capital Projects Finance, Procurement and 4,000 Corporate Services Fundraising, Legal Services 2,000 and Corporate Governance People and Culture 0 Learning and Teaching Non Chemotherapy Non Diagnostic sub-specialty Orthopaedics Clinical and sub-specialty Neurology Respiratory Obstetrics gastrointestinal Unqualified Urology Haematology Quality, Planning and Innovation surgery cardiology radiotherapy medicine medicine endoscopy neonate* Research About us About * A newborn who does not require admission for acute care 10 Clinical programs and services Eastern Health organises its 43 clinical services into nine programs, as outlined in the table below. These services are delivered from eight precincts and in some instances, directly into people’s homes. They are divided into two main areas of clinical operations – one that is largely focused around planned activity, including surgery, maternity and specialist (outpatient) clinics (SWMMS), and the other which is largely focused around unplanned activity, including emergency and acute inpatient care (ASPPPA). Each program is led by a program director and an executive clinical director to enhance medical leadership. For more information about how these services are administered, please refer to the organisational structure on page 36.

Directorate Clinical Program Clinical Service Group Clinical Support Clinical Operations Acute and Aged 1 Emergency (ASPPPA) Medicine 2 General medicine Geriatric medicine Acute and Aged 3 Rehabilitation (inpatient) Medicine, Specialty 4 5 Palliative care Medicine and 6 Transition care Ambulatory 7 Residential aged care Care, Pathology, 8 Aged Care Assessment Service Pharmacy, 9 Residential in-reach Patient Access and Allied Health Specialty Medicine 10 Cancer services and Ambulatory Care 11 Renal 12 Cardiology 13 Endocrinology 14 Gastroenterology 15 Haematology/haemostasis and thrombosis 16 Infectious diseases 17 Neurosciences 18 Respiratory 19 Rheumatology 20 Dermatology 21 Eastern@Home Allied Health 22 Sub-acute clinics Medical Imaging 23 Community health

24 Community rehabilitation Pathology 25 Aboriginal health Patient Access Clinical Operations Surgery 26 Anaesthetics Pharmacy (SWMMS) 27 Breast and endocrine Colorectal Surgery, 28 Ear, nose and throat Women and Children 29 30 General/paediatric and Acute Specialist 31 Orthopaedic Clinics, Mental 32 Plastic Health, Medical 33 Upper gastrointestinal/bariatric/thoracic Imaging 34 Urology and Statewide 35 Vascular Services 36 Intensive care services Women and 37 Obstetrics Children and Acute 38 Gynaecology Specialist Clinics 39 Paediatric and neonatology 40 Acute specialist clinics Mental Health 41 Adult (community and rehabilitation) 42 Aged persons (triage and emergency) 43 Child and youth Statewide Services 44 Spectrum 45 Turning Point

To find out more about Eastern

Health, visit our website at Report 2017-2018 Annual Health Eastern www.easternhealth.org.au 11 Occupational health and safety

Eastern Health continues to strengthen its commitment to provide a safe workplace for staff, volunteers, patients and visitors.

In July 2017, Eastern Health Eastern Health’s focus throughout implement a new behavioural established an Occupational 2017-18 remained on key management plan and associated Violence and Aggression (OVA) organisational OHS risks related to behavioural management chart. aggression management, manual Taskforce, chaired by the Chief Work is also underway to strengthen handling and slips, trips and falls. Executive, to review all Eastern Eastern Health’s Code Grey response, Health practices and identify in line with the Department of Health areas for improvement. AGGRESSION and Human Services’ new Code Grey MANAGEMENT Standards, including revising data Feedback from a series of staff forums reporting systems to meet the new resulted in an OVA action plan and Eastern Health continued to receive requirements. framework. There were some 500 strong support from the Victorian pieces of information gathered and Government’s Health Service Violence Our aggression lost-time injury claims themed from these forums. As a result Prevention Fund – see page 13. Eastern frequency rate remained above target of this work, Eastern Health has: Health made two submissions for a this financial year. Work commissioned fourth round of funding in April 2018. by the OVA Taskforce and other key

Implemented additional ongoing Work is also underway as part of the projects will continue throughout security personnel at Box Hill, Behaviours of Concern Guideline to 2018-19. Maroondah and Angliss hospitals Supported the introduction of body- worn cameras for security staff at Box Aggression lost-time injury claims frequency rate per million Hill, Maroondah and Angliss hospitals total productive hours worked Promoted a campaign that supports 10.0 Rolling 12 months ratio Monthly ratio Target staff to actively report incidents 8.0 of aggression and violence 6.0 4.0 Implemented a new Post-Incident Support Guideline for incidents 2.0 related to occupational violence 0.0 June 2013 June 2018 Commenced new SAFE training programs which will ensure staff have access to the prevention and Occupational violence 2017-18 management of aggression training Workcover accepted claims with an occupational violence clause 0.36 they require. This includes an per 100 FTE# orientation face-to-face training Number of accepted workcover claims with lost time injury with an program for new hospital medical 2.19 occupational violence cause per 1,000,000 hours worked officers and interns Number of occupational violence incidents reported 675

Implemented 240 personal duress Number of occupational violence incidents reported per 100 FTE# 10.94 alarms for home visiting staff across Percentage of occupational violence incidents resulting in a staff Ambulatory Care, Mental Health 4.74% injury, illness or condition and Maternity Services # Full-time equivalent Introduced new clinical guidelines that strengthen the management of behaviours of concern and acute Definitions of a planned or unplanned Code Grey, the incident must be included. severe behavioural disturbance, Occupational violence Code Grey is a personal threat. including the use of behavioural Any incident where an employee is contracts and not welcome notices abused, threatened or assaulted in Accepted Workcover claims Partnered with local councils circumstances arising out of or in Claims that were lodged in 2017-18. the course of their employment. to upgrade lighting in the areas Lost time surrounding our major sites and Incident Defined as greater than one day. completed work at Healesville An event or circumstance that could Hospital and Yarra Valley Health have resulted in or did result in harm to Injury, illness or condition to improve car park lighting an employee. Incidents of all severity This includes all reported harm as Provided personal safety sessions with ratings must be included. Code Grey a result of the incident, regardless of whether the employee required About us About the Victoria Police Crime Prevention reporting is not included however, if Units across our major sites. an incident occurs during the course time off work or submitted aclaim. 12 Occupational health and safety

SERIOUS INJURIES SLIPS, TRIPS AND FALLS There were 10 “notifiable” incidents Injuries from slips, trips and falls remained steady throughout 2017-18 and were reported to WorkSafe Victoria. Eight below target for 10 out of 12 months. Regular safety alerts to staff and hazard of these related to staff, with five slips, audits, including Eastern Health grounds and car parks, are designed to identify trips and falls and three from being and manage environmental slips, trips and falls hazards. struck by objects – none were OVA related. Three of the staff slips, trips Lost-time injury slips, trips and falls claims on Eastern Health premises. and falls occurred outside and the Frequency per million total productive hours worked other two were inside our facilities as 8.0 a result of tripping over objects on the 7.0 Rolling 12 months ratio Monthly ratio Target floor. There were two visitor slips, trips 6.0 5.0 and falls incidents, with both occurring 4.0 on the grounds of Eastern Health. 3.0 2.0 1.0 0.0 IMPROVEMENT NOTICE June 2013 June 2018 During the reporting period, there was one contravention of the OHS Act 2004 (Vic) and OHS Regulations MANUAL HANDLING 2007 (Vic) that resulted in WorkSafe Manual handling, both clinical and non-clinical, continues to be a major hazard Victoria issuing an improvement for Eastern Health staff. There has been ongoing work in the clinical manual notice in August 2017. This was handling program area and a review of the patient manual handling training in relation to how Eastern Health framework has commenced and will continue during the first half of 2018-19. recorded the maintenance and details of lifting slings used with the patient hoists manual handling LOST-TIME INJURY CLAIMS equipment at Peter James Centre. Eastern Health’s lost-time injury workers’ compensation claims frequency rate The improvement notice was resolved (i.e. number of lost-time injury workers’ compensation claims as a percentage of in December 2017. total productive working hours per million hours worked) has mostly trended below target in 2017-18. Despite this positive result, there continues to be a strong focus on reviewing and improving safety systems to reduce the number and severity of POLICIES AND staff injuries. PROCEDURES OHS policies and key procedures Lost-time injury claims frequency rate per million total productive were reviewed in readiness for a hours worked successful ACHS accreditation survey 30.0 Rolling 12 months ratio Monthly ratio Benchmark in March 2018. 25.0 20.0 15.0 10.0 5.0 0.0 June 2013 June 2018

Eastern Health Chief Executive Adjunct Professor David Plunkett addresses the media with Victorian Minister for Health, the Hon Jill Hennessy, following the announcement of funding from Round 3 of the Health Service Violence Prevention Fund.

Eastern Health received $555,533 to Support the rollout of personal complement a number of initiatives duress alarms for ambulatory care already implemented. This additional home visiting staff funding was used to: Install swipe-activated door Support an upgrade to CCTV cameras mechanisms to all bedrooms in at the main entrance to Box Hill, acute and aged mental health Maroondah and Angliss hospitals inpatient settings

Install new lock systems to enable Install several client-activated front entrances of inpatient sites to duress alarms in mental health be locked down remotely by staff inpatient units. Report Report 2017-2018 Annual 2017-2018 Annual Health Health Eastern Eastern and/or security 13 14 About us Annual highlights as works have included anexpansion ofshort-stay and paediatric facilities, pictured, as well a new fourth floor, which willincrease the capacity ofcritical care More services. recent Stage oneofa$20millionexpansion project at Angliss Hospital was completed, including facilities and training spaces, as well asafresh environment for staff and clients. Anthony Denham said the new building provided enhanced treatment rooms, research S location brings together allof Turning Point’s treatment, research and education new chapter when they moved to their Richmond premises. This central inner city Turning Point and Spectrum, Eastern Health’s two statewide commenced services, a boost to healthcare in Melbourne’s outer east. October 2018when the new Intensive Care Unit opens and willprovide awelcome ervices, which wereervices, previously in various locations. Statewide Program Services Director the

BUILDING A BETTER ANGLISSHOSPITALBUILDING ABETTER

NEW ERAFOR STATEWIDE SERVICES partial refurbishment ofthe courtyard. The project is due for completion in

October 2017 July 2017 experience by improving safety and patient care. manager MarjaWondergem on day one ofthe new system, which willenhance thepatient Hospital. The EMRsystem has been designed to provide acomprehensive electronic patient Eastern Health launched anextension ofitsElectronic Medical Record (EMR)system at Box Hill May 2018 Pictured are Emergency Hannah Kleinitz guiding associate Department nurse “super unit user” record which isup to date, easy to read and accessibleinstantly by apatient’s healthcare team.

share thehospital’s excitement in such asignificant milestone. With2200births a year, the highlight theircollaboration inproviding safe, high-quality care for mothers and babies. pathologyimaging, and emergency departments were involved inthecountdown to hospital iscloseto the hearts ofmany in the community. Staff from thematernity, medical Angliss Hospital welcomed its100,000th baby, with Taylor Cox born at 10.25amon July 31, 2017.Taylor’s motherElise,pictured with themidwifery team, said she was thrilled to TECHNOLOGY EVOLUTION

100,000 REASONS TO CELEBRATE and cancer to services more than 25,000women every year. occasion with aribbon-cutting cutting ceremony. The centre willdeliver breast V $10 million Eastern HealthBreast and Cancer Centre at Maroondah Hospital. breast cancer screening and care on their doorstep with the opening ofthe Thousands more women in Melbourne’s east now have easieraccessto life-saving ictorian Minister for Health, the Hon Jill Hennessy, was onhand to markthe

BETTER, QUICKER BREASTBETTER, CANCER CARE See page 23 for more information. more for 23 page See

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15 15 Eastern Health 2017-2018 Annual Report Strategic priorities

Eastern Health’s Strategic Plan 2017-2022 helps us to understand our vision and mission, as well as how we are going to deliver them. We have four strategic initiatives and each initiative contains three priority goals.

Healthcare Leading in Leading in A values-based, excellence learning research and safe workplace innovation

ACHIEVING OUR KEY STAKEHOLDERS STRATEGIC PRIORITIES PERFORMANCE Eastern Health has a number of EXCELLENCE Information on the following strategic partnerships with key pages outlines key organisational stakeholders to help us achieve FRAMEWORK improvement activities that are our strategic initiatives and priority goals, including: Eastern Health is committed to agreed between Eastern Health and achieving our strategic initiatives the Victorian Minister for Health as Our community, through a and organisational objectives, and a component of the Statement of register of interested consumers utilises an agreed Performance Priorities each year. and community representatives Excellence Framework to ensure on a range of committees, They are consistent with Eastern we remain focused on these including the Community Advisory Health’s priorities, as identified Committee (see page 39) strategic priorities. within the Strategic Plan, and align Performance excellence occurs when with the government’s priorities Victorian Department of Health individuals and teams understand and and policy directions. and Human Services utilise all the elements of performance The Statement of Priorities is an Other Victorian health services excellence in their everyday practice annual accountability agreement – organisational planning, enterprise Community health services that sets out key performance risk management, performance expectations, targets and funding Eastern Melbourne Primary standards, performance monitoring and performance improvement and for the year, as well as government Health Network innovation. service priorities. These include Universities and other training the shared objectives of safe, Improvement and innovation institutions high-quality service provision, ease work occurs at the local (small), of access and financial sustainability. Research organisations and program (medium), site (medium), funding bodies directorate (large) or organisation- Changes to key performance wide (large) level and is undertaken measures in 2017-18 strengthened Local governments and other using the Eastern Health Model for the focus on high-quality and safe government agencies and Improvement. care, organisational culture, patient authorities. experience and access and timeliness All improvements are documented on Improvement and Innovation of care in line with ministerial and Plans, which are monitored and departmental priorities. reported on a quarterly basis. A Program Management Office has been established to support the Eastern Health’s organisation to improve the visibility, Strategic Plan 2017-2022 governance, prioritisation and delivery and Statement of Priorities are of improvement projects across the Our Performance Our available on the Eastern Health organisation. website at www.easternhealth.org.au 16 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Implement actions identified Better Health Better Health Achieved for year 2 of the action plan

A system geared Reduce statewide to progress the aims and Actions identified for year 2 of to prevention as risks initiatives of the Victorian the Victorian 10 Year Mental much as treatment Build healthy 10 Year Mental Health Plan Health Plan have been completed. Everyone neighbourhoods including a greater focus on Key milestones include: understands prevention and delivering Help people to stay Commencement of the HOPE their own health better services to achieve healthy positive health outcomes. Initiative in late 2017, which and risks provides tailored and enhanced Target health gaps Illness is detected holistic support for people who and managed early have been discharged from inpatient mental health services Healthy and who are at risk of suicide. neighbourhoods and communities Development and implementation encourage healthy of a post-intervention suicide lifestyles protocol, in collaboration with Victoria Police in the eastern region. Training all community mental health staff who work with adult clients in the Collaborative Recovery Model, as part of the Recovery Framework. This training program will be extended to embed these processes across the Mental Health Program. The Consumer, Family, Child and Carer Advisory Committee terms of reference were also revised to ensure collaborative engagement with consumers regarding program strategies. The Recovery Model implementation will be evaluated in June 2018. Commencement of the Youth Engagement and Treatment Initiative in October 2017 with high demand and favourably received by key stakeholders. The service is co-located with regional partners. Advisory and reference groups were also established to provide oversight of the service.

Expansion of the Specialist Child Treatment Team with additional staff and enhanced partnerships with key stakeholders. As a result, a pilot service was established with Maternal Child Health Services, with favourable outcomes including support for at-risk infants and accessibility to families with young children.

Achieved In progress Not achieved Report 2017-2018 Annual Health Eastern

17 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Complete the Achieved implementation of identified actions and Action items to address Eastern Health’s report compliance to ensure capability for responding to family violence organisation-wide systems are on track. These include: effectively identify, report and respond to instances Development of two education packages of family violence. Actions in 2016-17 comprising of an awareness include: level and an advanced level, which were implemented in priority areas such building staff capability as emergency departments, mental health and aged care. This was extended enhancing capacity in 2017-18 with more than 900 staff to respond to service receiving training to enable a sensitive demand; and and meaningful response to individuals developing organisational experiencing family violence. Staff are partnerships in the also working with the Australian Nursing area of health justice, and Midwifery Federation (ANMF) to particularly in relation have this training certified as Case Based to maternity and elder Discussion (CPD) eligible by the ANMF. abuse. In addition, an Elder Abuse forum was conducted on World Elder Abuse Day with a capacity attendance and positive feedback about the event. Determining and communicating to staff an increased credentialing requirement in the area of family violence for social workers. Additional dedicated funding to further enhance this program of work in 2018-19. Planning for this is underway. Examples being considered include family violence screening in maternity services and an alcohol and drug specialist family violence response, while sustainability of these services into the future will also be a focus.

Measuring our performance

One of the ways They are also aligned to the strategic initiatives (see page 16). Eastern Health Results against a number of these indicators are also available at monitors its performance the frontline, where the data can be broken down into individual is through a scorecard. wards or departments. It is also aggregated to single scores for each strategic initiative and an overall composite score which is This scorecard tracks the reported at Board and Executive Committee level. achievement of Each year, the measures and targets reported on the scorecard are reviewed to ensure they continue to be aligned with and 160 drive continuous improvement. key performance indicators – Eastern Health’s performance against key government service 89 of which are reported priorities can also be found on the Department of Health and Our Performance Our to the Board. Human Services website at www.dhhs.vic.gov.au. 18 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Build on the successful Achieved implementation of the Closing the Health Gap This program of work to build culturally- program of work to embed safe practices continued to expand during culturally-safe practices for 2017-18. This included a review of the Aboriginal and Torres Strait Closing the Gap governance structure Islander patients, including to enable more effective oversight and ensuring that reception implementation of initiatives to close and treatment areas are the health gap. In October 2017, three culturally welcoming for sub-groups were established to focus on Aboriginal and Torres Strait the high priority areas of: Islander people. Communications and events; Internal improvement; and External partnerships. A cultural audit was undertaken to continue ensuring cultural safety across Eastern Health services with action taken in response to the audit findings. Eastern Health is also finalising the development of a Collaborative Assessment with Aboriginal Clients and Families guideline that is expected to be implemented early in 2018-19. A Closing the Gap Co-ordinator was recruited, with the successful applicant commencing in January 2018. The Mental Health Program was also successful in obtaining funding for four years for two Aboriginal mental health traineeships to work across the access and community streams. Both trainees will work towards their degrees through Charles Sturt University. Funding for a Clinical Engagement role in mental health was also secured and this role is now funded permanently through Eastern Health. Implementation of the Closing the Gap Plan will continue as scheduled with planning underway for NAIDOC Week celebrations in July 2018 and the Closing the Gap Family Sports Day, scheduled for March 2019.

Complete the development Achieved of and explore prioritisation of the Master Plan for A Master Plan for the Wantirna Health Wantirna Health. precinct was completed during 2017-18. A business case to fund the first stage of capital works has been developed in collaboration with the Department of Health and Human Services for future consideration. Eastern Health will continue to work in partnership with the Department to acquire funding to progress this work to enhance and expand facilities. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

19 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Complete the refresh of Achieved the Master Plan for the Angliss Hospital precinct. An Angliss Hospital Precinct Master Plan refresh project was completed in 2017-18. Eastern Health will continue to work in partnership with the Department of Health and Human Services to seek funding to progress with capital development across the precinct, in accordance with the priorities identified in the Master Plan.

Complete the development Achieved of and commence implementation of the A comprehensive action plan to address action plan to address the risks associated with occupational the risks associated with violence and aggression was developed. occupational violence and Implementation of the plan is on track aggression in the workplace. including: Successful application to the Department of Health and Human Services (DHHS) Health Service Violence Prevention Fund to support a range of new initiatives A review of Code Grey (aggression incident) procedures to ensure alignment with DHHS guidelines DHHS support in the form of additional security staff across the major sites; and A new SAFE (Safe, Aggression Free Environment) training program was successfully trialled and is currently being progressively implemented

Listening to our consumers

Our patients play a significant role in shaping our programs and services. We are committed to listening and acting on their feedback, which we gather through a number of channels. Eastern Health’s Centre for Patient Experience provides a framework, systems and support for effective community and patient participation and oversees the patient experience strategy, known as In the Patient’s Shoes. Our strategic and annual planning processes also include consumers and we have increased consumer engagement. Pictured are Oncology in the Home Associate Nurse Unit Manager Maree Lennon and patient Lawrence Harvey. See page 25 for information

Our Performance Our about improvement work in this area.

20 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Progress the implementation Better Access Better Access Achieved of the major projects

Care is always Plan and invest associated with the Implementation of the “Every Minute there when people Unlock innovation "Every Minute Matters" Matters” program of work continued need it improvement plan with a throughout 2017-18 to enhance Provide easier More access to focus on enhancing patient emergency access performance. At the access care in the home flow across the major start of the year, 17 initiatives identified and community transitions of the continuum for 2017-18 were further refined to of care including enhanced seven priority initiatives, focusing on a access to services provided range of clinical and non-clinical areas in the home and community. across the care delivery system and dedicated to improving performance in the following emergency access indicators: four-hour patient length of stay time to treatment; and ambulance off-stretcher time. These initiatives are being supported by the Department of Health and Human Services through dedicated project funding. Each of the seven projects are being implemented utilising Eastern Health's four-stage Model for Improvement process and are at various stages based on their scale, scope and progress throughout the year. All of these initiatives are being reported through the Program Management Office to ensure visibility and adherence to project management systems and processes. The impact of this work has been further supported by additional funding to increase capacity and workforce in key areas.

Implement the identified Better Access Better Access Achieved actions to ensure Eastern

People are Ensure fair access Health is prepared for the During 2017-18, Eastern Health connected to introduction of the National implemented the identified actions to the full range of Disability Insurance Scheme ensure the organisation was prepared care and support (NDIS) within the Eastern for the introduction of the National they need Metropolitan Region and Disability Insurance Scheme (NDIS). There is equal complete the evaluation of This included a decision that Eastern access to care Eastern Health becoming a Health would not register as a provider registered provider under under this funding scheme. Where this scheme. barriers to service provision have been encountered, there has been active management to identify alternative arrangements for patients. Additional areas of focus include refining systems for the engagement of program-based NDIS representatives in registering issues, measuring and responding to Eastern Health's performance in relation to NDIS patients and liaison with the Department of Health and Human Services regarding persistent barriers/risks. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

21 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Progress the implementation Achieved of the HealthLinks chronic care initiative to further Implementation of the HealthLinks enhance the co-ordination Chronic Care initiative progressed and delivery of services throughout the year with a pilot project for clients with chronic being undertaken. Ethics approval was health conditions to sought and received, and a formal reduce avoidable hospital evaluation of the program will be admissions. undertaken by the CSIRO over the course of the program. The financial implications and impact of this new service model are being evaluated and a project steering committee will continue to oversee the initiative and monitor its implementation. The proposed model is planned for implementation in 2018-19.

Actively collaborate with Achieved organisational partners through the Eastern Implementation of priority areas in the Melbourne Primary Health Eastern Melbourne Primary Health Care Care Collaborative to Collaborative (EMPHCC) Primary Health implement actions identified Strategic Plan 2017-2018 was overseen in the Primary Health Plan by the EMPHCC Governance Group. 2017-18. These priority areas included end of life care, the HealthLinks Chronic Care program (refer to deliverable above) and diabetes prevention and management. A planning workshop was held in early 2018 to consider the outcomes from a partnership evaluation that was undertaken in late 2017. The Governance Group also confirmed the process for the next EMPHCC Strategic Plan.

Connect with Respect

In 2012, Eastern Health reinforced its commitment to closing the health gap between Aboriginal and Torres Strait Islander people and non-indigenous Australians when it signed the Statement of Intent with members of the local Aboriginal community (see page 19 for initiatives in this area). A special celebration of Aboriginal culture at Maroondah PARC (Prevention and Recovery Care) in February 2018 emphasised the importance of cultural inclusiveness when providing better mental health care to our local Aboriginal communities. A Welcome to Country by Wurundjeri Elder Aunty Joy Murphy, a smoking ceremony and Aboriginal artwork specifically created for the service were among the highlights. Pictured are Aboriginal engagement clinician Kate Locastro and consumer Our Performance Our representative Eddie Thomson with the artwork. 22 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Complete the capital Achieved development works and commence delivery of The Eastern Health Breast and Cancer integrated services from the Centre at Maroondah Hospital is fully Eastern Health Breast and operational, with the construction Cancer Centre to enhance program completed in early 2018 and the quality of and access services commencing in April 2018. to integrated breast cancer All services completed their relocation healthcare services. and commissioning of new facilities in late May 2018.

Complete capital Achieved development works and commence delivery of Angliss Hospital’s Intensive Care Unit enhanced critical care capital works have been completed and services from stage 1 were officially opened on 1 September of the Angliss Hospital 2017. The Intensive Care Service will redevelopment. be fully operational by October 2018. This includes progressing The capital redevelopment of the stage 2 capital works. emergency department and short-stay unit (stage 2) is also complete and will commence services in July 2018.

Progress the implementation Better Care Better Care Achieved of activities identified for

Target zero Put quality first year 3 of the Great Digital The extended Electronic Medical Record avoidable harm Join up care Information Management (EMR) went live at Box Hill Hospital on Healthcare that and Transformation Strategy, 29 October 2017. In addition, an electronic Partner with Specimen Collection module (for pathology focuses on in alignment with Eastern patients investigations) was implemented across all outcomes Health’s new Strategic Plan and the Digitising Health sites. Adoption, stabilisation and transition Strengthen the Patients and Strategy, and in accordance to “business as usual” are now the focus workforce carers are active with the Victorian to ensure full integration within and across partners in care Embed evidence Auditor-General’s Office the health service. A post-implementation recommendations. review was completed to identify key Care fits together Ensure equal care In particular, this will include learnings for both Eastern Health and around people’s the organisation-wide future EMR implementations inVictoria. needs Issues experienced post “go-live” have integration of the Cerner been addressed and optimisation Electronic Medical Record opportunities are currently under review. solution. Assurance was provided through the post-implementation review regarding the planned implementation of the FirstNet solution at Angliss and Maroondah hospitals in late 2018 or early 2019.

Our commitment to eQuality

Eastern Health has commenced work using the Rainbow eQuality Guide to identify and adopt “actions for inclusive practices” to be more responsive to the health and wellbeing of lesbian, gay, bisexual, transgender and intersex (LGBTI) individuals and communities. One of the ways we do this is by participating in the Pride Cup, which is an event that celebrates diversity and inclusion in sport for the LGBTI community. For the fourth year in a row, Eastern Health sponsored the Yarra Glen football and netball matches, with Eastern Health staff talking to patrons about the organisation’s commitment to providing a positive and safe environment for the LGBTI community. Eastern Health has worked with consumers from the LGBTI community to demonstrate it is an inclusive health service. Examples include ensuring the organisation provides a welcoming environment by displaying the rainbow flag and eQuality posters. Report Report 2017-2018 Annual 2017-2018 Annual Health Health Eastern Eastern

23 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Embed Eastern Health’s Achieved new values and strategic initiatives, including Eastern Health's new values, contained in the "A values-based, safe Strategic Plan 2017-2022, have now been workplace" established in the embedded across the organisation’s systems and Strategic Plan 2017-2022, in processes following the plan’s approval by the all organisational operating Minister for Health in August 2017. This work has systems to strengthen the been further supported by the development and organisation’s positive approval of a “People Strategy” that includes a workforce culture. significant focus on workforce culture. A project plan focusing on actions to strengthen engagement and workforce culture has been developed and its implementation is underway.

Undertake an evaluation Achieved of organisational systems against the new Department Following a comprehensive evaluation, a program of Health and Human of work to ensure organisational systems align with Services Clinical Governance the Department of Health and Human Services Framework and establish a Clinical Governance Framework was developed plan to address any gaps. and is on track. A project plan includes revision of the Eastern Health Clinical Governance Framework and policy. A “gap analysis” has been undertaken to inform the development of a draft framework and policy for consultation with members of the Clinical Executive Committee and Quality and Safety Committee. Final approval will be sought in late June 2018 followed by wide dissemination to clinical leaders across Eastern Health.

Accreditation

Eastern Health demonstrates its commitment to excellence through external accreditation with a range of industry standards, including the National Safety and Quality Health Service Standards.

In March 2018, the Australian Our high-achieving areas were: cardiology service are accredited Council on Healthcare Standards under the National Association of 1.2.2: Action is taken to improve the (ACHS) awarded Eastern Health full Testing Authorities. accreditation for four years. safety and quality of patient care Our four residential aged care 1.6.2: Actions are taken to maximise This followed an extensive facilities – Edward Street Nursing patient quality of care organisation-wide survey when Home in Upper Ferntree Gully, Eastern Health was assessed against 8.2.4: Action is taken to reduce the Monda Lodge in Healesville, the National Safety and Quality frequency and severity of pressure Mooroolbark and Northside in Health Service Standards, ACHS injuries; and Burwood East are accredited by Evaluation Quality Improvement the Australian Aged Care Quality Program (EQuIP) National Standards, 8.3.1: Quality improvement Agency and our palliative care service National Standards for Mental Health activities are undertaken to prevent is accredited under the National Services and Department of Health pressure injuries and/or improve the Standards Assessment Program. and Human Services Standards. management of pressure injuries. Yarra Valley Health’s general Eastern Health met all core standards Accreditation was awarded until practice clinic in Healesville also and also received four “Met with March 2022. Merit” ratings, which is the highest has full accreditation under the scoredo use t recognise excellence Eastern Health’s pathology Royal Australian College of General

Our Performance Our for those actions. laboratories, medical imaging and Practitioners accreditation scheme.

24 Performance against strategic priorities

Goals Strategies Health Service Deliverables Outcome

Develop and implement a Mandatory actions Achieved against the "Target plan to educate staff about zero avoidable their obligations to report An education program to ensure staff are harm" goal patient safety concerns. aware of their obligations to report safety concerns was developed and implemented Develop and across Eastern Health. A high level of implement a plan organisation-wide compliance has been to educate staff achieved with completion of the National about obligations to Standards iLearn training package exceeding report patient safety 90 per cent across Eastern Health in 2018. concerns. This education has now been embedded as an annual requirement for all staff.

In partnership with In partnership Achieved with consumers, consumers, plan and identify three priority implement initiatives to In partnership with consumers, a new improvement areas address priority areas “Patients First” program of improvement work using Victorian identified from the Victorian has been established. A Steering Committee, Healthcare Healthcare Experience chaired by the Chief Executive and including Experience Survey Survey. These include: consumers, Eastern Health staff and a Safer data and establish Care Victoria (SCV) representative, meets decision-making in care an improvement regularly to oversee this work. The program is focused on improving capability in the plan for each. These courtesy and kindness, following three areas: should be reviewed and communication. every six months to Patient and family involvement in reflect new areas decision-making about care; for improvement in Courtesy and kindness; and patient experience. Communication. Specific examples include the communication training project in General Medicine and exploration of the Institute for Healthcare Improvement (IHI) “Joy in Work” program by Maternity Services. This program is responsible for overseeing Eastern Health’s participation in the IHI co-production learning community which is receiving valuable support from SCV.

Healthcare in any language

Eastern Health employs an in-house team of NAATI-accredited interpreters and was the first metropolitan health service to employ a Chin Hakha interpreter. About 55 per cent of services are delivered in-house. There were 10,374 patients who required an interpreter in 2017-18. For more information, please refer to Eastern Health’s Quality Account at www.easternhealth.org.au 6.1% 8.71% 72 (or 10,374) (or 14,798) languages in which patients requiring patients with a primary services were an interpreter language other provided than English Report Report 2017-2018 Annual 2017-2018 Annual Health Health Eastern Eastern 25 High quality and safe care

Key performance indicator Target 2017-18 result Accreditation Accreditation against the National Safety and Quality Health Service Standards Full compliance Achieved Compliance with the Commonwealth’s Aged Care Accreditation Standards Full compliance Achieved Infection prevention and control Compliance with the Hand Hygiene Australia program 80% 88% Percentage of healthcare workers immunised for influenza 75% 78% Patient experience Victorian Healthcare Experience Survey – data submission Full compliance Not Achieved 95% positive Victorian Healthcare Experience Survey – positive patient experience – Quarter 1 92% experience 95% positive Victorian Healthcare Experience Survey – positive patient experience – Quarter 2 94% experience 95% positive Victorian Healthcare Experience Survey – positive patient experience – Quarter 3 92% experience 75% very positive Victorian Healthcare Experience Survey – discharge care – Quarter 1 75% experience 75% very positive Victorian Healthcare Experience Survey – discharge care – Quarter 2 75% experience 75% very positive Victorian Healthcare Experience Survey – discharge care – Quarter 3 74% experience Victorian Healthcare Experience Survey – patients perception of cleanliness – Quarter 1 70% 70% Victorian Healthcare Experience Survey – patients perception of cleanliness – Quarter 2 70% 71% Victorian Healthcare Experience Survey – patients perception of cleanliness – Quarter 3 70% 68% Healthcare associated infections Number of patients with surgical site infection No outliers Achieved Number of patients with ICU central line-associated bloodstream infection (CLABSI) Nil Achieved Rate of patients with SAB1 per occupied bed day ≤ 1/10,000 0.8 Adverse events Number of sentinel events Nil 7 Mortality – number of deaths in low mortality DRGs2 Nil N/A* Mental health Percentage of adult acute mental health inpatients who are readmitted within 14% 13% 28 days of discharge Rate of seclusion events relating to a mental health acute admission – all age groups ≤ 15/1,000 8 Rate of seclusion events relating to a child and adolescent acute mental health admission ≤ 15/1,000 6 Rate of seclusion events relating to an adult acute mental health admission ≤ 15/1,000 10 Rate of seclusion events relating to an aged acute mental health admission ≤ 15/1,000 2 Percentage of child and adolescent acute mental health inpatients who have a 75% 84% post-discharge follow-up within seven days Percentage of adult acute mental health inpatients who have a post-discharge 75% 82% follow-up within seven days Percentage of aged acute mental health inpatients who have a post-discharge 75% 95% follow-up within seven days Maternity and newborn Rate of singleton term infants without birth anomalies with Apgar score <7 at 5 minutes ≤ 1.6% 1.7% Rate of severe foetal growth restriction (FGR) in singleton pregnancy undelivered ≤ 28.6% 28.0% by 40 weeks Continuing care Functional independence gain from an episode of GEM3 admission to discharge ≥ 0.39 0.55 relative to length of stay Functional independence gain from an episode of rehabilitation admission to ≥ 0.645 1.047 discharge relative to length of stay

1: SAB is Staphylococcus Aureus Bacteraemia. 2: DRG is Diagnosis Related Group.

Our Performance Our 3: GEM is Geriatric Evaluation and Management. * This indicator was withdrawn during 2017-18 and is currently under review by the Victorian Agency for Health Information. 26 Timely access to care

2017-18 result

Angliss Box Hill Maroondah Key performance indicator Target Hospital Hospital Hospital Emergency care Percentage of patients transferred from ambulance to 90% 95% 78% 88% emergency department within 40 minutes Percentage of Triage Category 1 emergency patients seen 100% 100% 100% 100% immediately Percentage of Triage Category 1 to 5 emergency patients 80% 84% 71% 82% seen within clinically recommended time Percentage of emergency patients with a length of stay in the 81% 81% 59% 67% emergency department of less than four hours Number of patients with a length of stay in the emergency 0 0 0 0 department greater than 24 hours

Key performance indicator Target 2017-18 result Elective surgery Percentage of urgency category 1 elective surgery patients admitted within 30 days 100% 100% Percentage of urgency category 1,2 and 3 elective surgery patients admitted 94% 87% within clinically recommended time 5% or 15% Percentage of patients on the waiting list who have waited longer than clinically proportional 14% recommended time for their respective triage category improvement from prior year Number of patients on the elective surgery waiting list1 2,509 2452 Number of hospital initiated postponements per 100 scheduled elective ≤ 8 /100 7.3 surgery admissions Number of patients admitted from the elective surgery waiting list 16,830 17,590 Specialist clinics Percentage of urgent patients referred by a GP or external specialist who 100% 77% attended a first appointment within 30 days Percentage of routine patients referred by GP or external specialist who attended 90% 95% a first appointment within 365 days

1: The target shown is the number of patients on the elective surgery waiting list as at 30 June 2018.

Effective financial management

Key performance indicator Target 2017-18 result Finance Operating result ($m) 0.00 189 Average number of days to paying trade creditors 60 days 59.44 Average number of days to receiving patient fee debtors 60 days 59.45 Public and Private WIES1 activity performance to target* 100% 95.57% 0.7 or 3% improvement Adjusted current asset ratio from health 0.467 service base target Number of days of available cash 14 days 7.6

1: WIES is a Weighted Inlier Equivalent Separation. * Following an adjustment to the WIES funding calculations, Eastern Health was funded for 101.11 per cent despite a shortfall in the activity target Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern for 2017-18. 27 Strong governance, leadership and culture

Key performance indicator Target 2017-18 result

Organisational culture People Matter Survey – percentage of staff with an overall positive response to 80% 75% safety and culture questions People Matter Survey – percentage of staff with a positive response to the question, “I am encouraged by my colleagues to report any patient safety concerns 80% 84% I may have” People Matter Survey – percentage of staff with a positive response to the 80% 79% question, “Patient care errors are handled appropriately in my work area” People Matter Survey – percentage of staff with a positive response to the question, “My suggestions about patient safety would be acted upon if 80% 77% I expressed them to my manager” People Matter Survey – percentage of staff with a positive response to the question, “The culture in my work area makes it easy to learn from the errors 80% 72% of others” People Matter Survey – percentage of staff with a positive response to the 80% 77% question, “Management is driving us to be a safety-centred organisation” People Matter Survey – percentage of staff with a positive response to the 80% 66% question, “This health service does a good job of training new and existing staff” People Matter Survey – percentage of staff with a positive response to the 80% 69% question, “Trainees in my discipline are adequately supervised” People Matter Survey – percentage of staff with a positive response to the 80% 77% question, “I would recommend a friend or relative to be treated as a patient here”

Results are from the People Matter Survey conducted in May 2017.

Eastern Health’s growth over the past five years is depicted in the tables below

Number of elective surgeries Number of emergency presentations

20,000 200,000

15,000 150,000

10,000 100,000

5,000 15,157 15,366 16,523 16,987 17,590 50,000 143,375 151,810 157,532 166,554 168,898

0 0 2013-14 2014-15 2015-16 2016-17 2017-18 2013-14 2014-15 2015-16 2016-17 2017-18

Number of babies born Episodes of patient care

6000 1,250,000

1,000,000 4000 750,000

500,000 2000 4559 4655 4939 5026 4797 250,000 986,125 1,173,359 1,175,249 1,222,461 1,327,468

0 0 2013-14 2014-15 2015-16 2016-17 2017-18 2013-14 2014-15 2015-16 2016-17 2017-18 Our Performance Our

28 Activity and funding

2017-18 Key performance indicator Activity Achievement

Acute Admitted WIES Public 79,158 WIES Private 16,939 WIES DVA 759 WIES TAC 561 Acute Non-Admitted Home Enteral Nutrition 437 Home Renal Dialysis 65 Specialist Clinics – Public 154,543 Sub-Acute and Non-Acute Admitted Sub-Acute WIES – Rehabilitation Public 1322 Sub-Acute WIES – Rehabilitation Private 553 Sub-Acute WIES – GEM Public 1689 Sub-Acute WIES – GEM Private 828 Sub-Acute WIES – Palliative Care Public 480 Sub-Acute WIES – Palliative Care Private 194 Sub-Acute WIES – DVA 143 Transition Care – Bed days 25,672 Transition Care – Home days 7474 Subacute Non-Admitted Health Independence Program – Public 131,201 Aged Care Residential Aged Care 18,527 HACC 6057 Mental Health and Drug Services Mental Health Ambulatory 145,250 Mental Health Inpatient – Available bed days 44,195 Mental Health Residential 19,894 Mental Health Service System Capacity 2 Mental Health Sub-Acute 17,394 Drug Services 5720 Primary Health Community Health / Primary Care Programs 27,281 Other Health Workforce 347

WIES is a Weighted Inlier Equivalent Separation. HACC is Home and Community Care. GEM is Geriatric Evaluation and Management. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

29 ENVIRONMENTAL develop initiatives that improve sustainability initiatives, transferring efficiencies and reduce our from paper to electronic medical PERFORMANCE environmental footprint. records and choosing more environmentally-friendly products. Eastern Health reinforced its This has included a focus on water, commitment to environmental waste management, providing Below is a summary of our sustainability by continuing to further education to staff about performance during 2017-18:

2013-2014 2014-2015 2015-2016 2016-2017 2017-2018 Greenhouse gas emissions Total greenhouse gas emissions (tonnes CO2e) Scope 1 – Direct emissions combined 6614 7152 8380 7947 Scope 2 – Indirect emissions combined 51,545 44,016 42,027 39,546 Total 38,729 58,159 51,168 50,407 47,492 Normalised greenhouse gas emissions Emissions per unit of floor space (kgCO2e/m2) 332.00 269.31 236.94 233.55 220.05 Emissions per unit of separations (kgCO2e/separations) 94.24 406.18 343.00 308.54 281.20 Emissions per unit of bed day (kgCO2e/OBD) 100.00 126.99 108.03 100.74 97.56 Stationary energy Total stationary energy purchased by energy type (GJ) Diesel oil in buildings 2859 1124 1118 968 417 Electricity 96,092 157,256 139,900 138,804 131,818 Natural gas 98,221 128,852 137,279 161,314 153,649 Total 197,172 286,108 278,297 301,086 285,884 Normalised stationary energy consumption Energy per unit of floor space (GJ/m2) 1.74 1.32 1.29 1.40 1.32 Energy per unit of separations (GJ/separations) 1.45 2.00 1.87 1.84 1.69 Energy per unit of bed day (GJ/OBD) 0.63 0.62 0.59 0.60 0.59 Embedded generation Total embedded stationary energy generated by energy type (GJ) Solar power N/A N/A N/A N/A 29 Total N/A N/A N/A N/A 29 Water Total water consumption by type (kL) Potable water 187,320 208,502 209,422 227,628 206,765 Reclaimed water 14,912 11,034 24,008 34,074 39,517 Total 202,232 219,536 233,430 261,702 246,282 Normalised water consumption (Potable + Class A) Water per unit of floor space (kL/m2) 0.87 0.97 0.97 1.05 0.96 Water per unit of separations (kL/separations) 1.38 1.46 1.40 1.39 1.22 Water per unit of bed day (kL/OBD) 0.42 0.46 0.44 0.45 0.42 Water re-use and recycling Re-use or recycling rate (%) 7 5 10 13 16 Waste and recycling Waste (kg) Total waste generated 1,155,000 1,234,000 1,302,000 2,443,882 2,541,424 Total waste to landfill generated 1,542,000 1,732,000 1,816,000 1,900,905 1,900,980 Total waste to landfill per patient treated 0.21 1.67 1.61 2.30 2.30 Recycling rate (%) 4.1 19.4 22.1 26.25 30.17 Paper Total reams of paper 45,104 51,138 51,786 52,903 52,042 Carbon neutural (0% recycled) 43,550 49,203 50,309 47,694 45,471 Rate recycled paper (0%-49%) 1554 1935 1477 2224 2449 Rate recycled paper (50%-74%) 0* 0* 0* 2225 2607 Rate recycled paper (75%-100%) 0* 0* 0* 760 1515 Transport Corporate transport Reported vehicle kilometres 711 663 576 561 551 Tonnes CO2e per 1,000 reported kilometres 2,954,355 2,954,355 2,495,381 2,399,201 2,336,479

* This is a new indicator and therefore there is no comparative data.

Our Performance Our Results prior to 2014-15 do not reflect Eastern Health's total facility portfolio due to differing reporting standards. The figures for 2017-18 are estimates as at 30 June 2018. 30 Statutory compliance

FREEDOM OF to their medical records and four the Act. Most applications were non-personal requests from media, a state received from patients, their legal INFORMATION member of parliament and a law firm. or other representative, or surviving next of kin and most were for access Eastern Health complies with the Full access to documents was provided in to medical records. Victorian Freedom of Information Act 820 requests. Partial access was granted 1982 which allows individuals to apply for 420 requests, while seven requests Eastern Health collected $32,295 in for access to government documents were denied in full. The most common application fees and waived $6725. that are not available for public reason for Eastern Health seeking to fully Eastern Health collected $29,040 in inspection. or partially exempt requested documents charges to access documents and In 2017-18, Eastern Health received was the protection of personal privacy waived $22,242. 1378 requests under the Freedom in relation to requests for information For information about how to of Information Act 1982. This total about persons other than the applicant. comprised of 1374 personal make an FOI request and any costs requests, mostly from patients or There were 11 requests either withdrawn associated with the request, visit their representatives seeking access by the applicant or processed outside www.easternhealth.org.au

Freedom of information requests 2013-14 2014-15 2015-16 2016-17 2017-18 Number of requests 1153 1173 1243 1262 1378 Access provided in full 739 747 759 708 820 Access provided in part 337 307 376 410 420 No documents 30 36 44 38 40 Access denied 2 4 10 8 7 Request withdrawn by applicant 9 17 25 7 9 Transferred to another agency 0 0 0 1 0 Complaints lodged with OVIC 4 7 6 6 4 Referred to OVIC for review 6 6 6 6 9 Decisions deferred to VCAT 0 0 1 1 1 Requests not completed 36 62 29 89 80 Requests processed outside the Act - - - 2 2

OVIC – Office of the Victorian Information Commissioner (formerly known as FOI Commissioner)

PROTECTED There were no disclosures to the Eastern Health has no matters to report IBAC in 2017-18. in relation to its obligation under section DISCLOSURES For more information, visit 40 of the Safe Patient Care Act 2015. Eastern Health complies with the www.ibac.vic.gov.au. Protected Disclosure Act 2012 (Vic), which forms part of Victoria’s anti- CARER INVOLVEMENT corruption laws. Neither “improper CAR PARKING The Carers Recognition Act 2012 (Vic) conduct” nor reprisal against a person Eastern Health complies with the promotes and values the role of people for a “protected disclosure” is acceptable Department of Health and Human in carer relationships and recognises to us. We support the making of Services hospital circular on car the contribution that carers and people disclosures about such conduct to parking fees and details of car parking in carer relationships make to the social the Independent Broad-based fees and concession benefits can be and economic fabric of the Victorian Anti-corruption Commission (IBAC). viewed at www.easternhealth.org.au. community. We are taking measures Any requests for information about to finalise compliance with our our procedures for the protection SAFE PATIENT CARE obligations under the Act, as outlined of persons from unlawful reprisal in our Patient and Family-Centred Care Workforce management systems for protected disclosures should be Standard that guides our practice and and processes ensure Eastern directed to the Executive Director of in our Partners in Care booklet that is Health complies with the Safe People and Culture at Eastern Health. provided to every patient on admission. Patient Care (Nurse to Patient and Protected disclosures are distinguished Midwife to Patient Ratios) Act This will ensure that the needs of from complaints or grievances that would 2015, which requires that minimum carers are recognised and responded to be dealt with under Eastern Health’s nurse-to-patient ratios are met when when the person for whom they care is usual complaint or grievance processes, determining nurse and midwife admitted to Eastern Health or when the

such as a patient’s healthcare complaint staffing levels across those services carer is admitted to Eastern Health. Report 2017-2018 Annual Health Eastern or an employee’s industrial grievance. and wards covered by this legislation. 31 Statutory compliance

Details of individual consultancies (valued at $10,000 or greater)

In 2017-18, there were six consultancies where the total fees payable to the consultant were greater than $10,000, with a total expenditure of $116,122. Details of individual consultancies can be viewed at www.easternhealth.org.au.

Total approved Expenditure Future project fee 2017-18 expenditure Start End (excluding (excluding (excluding Consultant Purpose of consultancy date date GST) GST) GST) Delivery of a community Arabic Welfare Jul-17 Aug-17 14,000.00 14,000.00 - activity plan Review of medical Clayton Utz Jul-17 Oct-17 33,510.00 33,510.00 - workforce unit David Caple & OHS strategy review Jul-17 Jul-17 26,875.00 26,875.00 - Associates Pty Ltd Program management office MetaPM Pty Ltd Nov-16 Jul-17 80,522.73 28,437.50 design and implementation Review of the People and Graylin Pty Ltd Jul-17 Jul-17 13,300.00 13,300.00 - Culture function TOTAL 168,207.73 116,122.50 -

In 2017-18, Eastern Health engaged 10 consultancies where the total fees payable to the consultants were less than $10,000, with a total expenditure of $39,324 (excl. GST).

ADDITIONAL (e) Details of any major external (i) Details of assessments and reviews carried out on the health measures undertaken to improve INFORMATION service the occupational health and safety Details in respect of the items listed of employees Details of major research and below have been retained by Eastern (f) development activities undertaken General statement on industrial Health and are available to the relevant (j) by the health service that are relations within the health service Ministers, Members of Parliament not otherwise covered either and details of time lost through and the public on request (subject to in the report of operations or in industrial accidents and disputes, freedom of information requirements, if applicable): a document that contains the which is not otherwise detailed in financial statements and report the report of operations (a) Declarations of pecuniary interests of operations have been duly completed by all (k) A list of major committees relevant officers (g) Details of overseas visits sponsored by the health service, undertaken, including a summary the purposes of each committee (b) Details of shares held by senior of the objectives and outcomes and the extent to which those officers as nominee or held of each visit purposes have been achieved beneficially (h) Details of major promotional, (l) Details of all consultancies and (c) Details of publications produced public relations and marketing contractors, including consultants/ by the entity about itself and how activities undertaken by the health contractors engaged, services these can be obtained service to develop community provided and expenditure (d) Details of changes in prices, fees, awareness of the health service committed for each engagement. charges, rates and levies charged and its services by the health service Our Performance Our

32 Statutory compliance

NATIONAL ATTESTATION ON DATA INTEGRITY COMPETITION POLICY COMPLIANCE WITH I, David Plunkett, certify that Eastern Eastern Health is committed to ensuring HEALTH PURCHASING Health has put in place appropriate that services demonstrate both quality internal controls and processes to and efficiency. Competitive neutrality, VICTORIA (HPV) HEALTH ensure that reported data accurately which supports the Commonwealth PURCHASING POLICIES reflects actual performance. Eastern Health has critically reviewed these Government’s National Competition I, David Plunkett, certify that Eastern Policy, helps to ensure net competitive controls and processes during the year. Health has put in place appropriate advantages that accrue to a government internal controls and processes to business are offset. ensure that it has complied with Eastern Health understands the all requirements set out in the HPV requirements of competitive neutrality Health Purchasing Policies, including and acts accordingly. It complies with the mandatory HPV collective agreements Adjunct Professor David Plunkett Competitive Neutrality Policy Victoria as required by the Health Services Act Chief Executive and any subsequent reforms that 1988 (Vic) and has critically reviewed Eastern Health relate to responsible expenditure and these controls and processes during infrastructure projects, and the creation 9 August 2018 of effective partnerships between the year. private enterprise and the public sector. CONFLICT OF INTEREST BUILDINGS AND FACILITIES I, David Plunkett, certify that Eastern Health has put in place appropriate Eastern Health complies with the Adjunct Professor David Plunkett internal controls and processes to building and maintenance provisions Chief Executive ensure that it has complied with of the Building Act 1993, with all works Eastern Health the requirements of hospital circular completed in 2017-18 according to 07/2017 Compliance Reporting in the relevant provisions of the National 9 August 2018 Health Portfolio Entities (Revised) Construction Code. and has implemented a “Conflict of Eastern Health ensures works are Interest” policy consistent with the inspected by independent building ATTESTATION minimum accountabilities required surveyors and maintains a register ON FINANCIAL by the Victorian Public Sector of building surveyors, as well as the Commission. jobs they have certified and for which MANAGEMENT occupancy certificates have been issued. COMPLIANCE Declaration of private interest forms have been completed by all Executive All building practitioners are required to I, Joanna Flynn, on behalf of the staff within Eastern Health and show evidence of current registration Responsible Body, certify that members of the Board, and all declared and must maintain their registration Eastern Health has complied with conflicts have been addressed and are status throughout the course of their the applicable Standing Directions being managed. Conflict of interest is work with us. of the Minister for Finance under a standard agenda item for declaration the Financial Management Act 1994 and documenting at each Executive VICTORIAN INDUSTRY and Instructions. Committee and Board meeting. PARTICIPATION POLICY Eastern Health complies with the Victorian Industry Participation Policy (VIPP) Act 2003, which requires local industry participation in supplies, Dr Joanna Flynn AM Adjunct Professor David Plunkett taking into account the value for Chair Chief Executive money principle and transparent Eastern Health Board Eastern Health tendering processes. 9 August 2018 9 August 2018 Eastern Health completed a VIPP Contestability Assessment for two projects that commenced in 2017-18. Details of ICT expenditure A VIPP plan was not required for one of these projects because it was Total Information and Communication Technology (ICT) expenditure incurred assessed and deemed non-contestable. during 2017-18 is $49.6 million (excluding GST), as per below: An application was made to the Industry Capability Network (ICN) for BAU Non-BAU the other project tender however, the tender process was not finalised Total Operational Capital within the 2017-18 financial year. Expenditure expenditure expenditure expenditure There were no contracts awarded $30.2 million $19.4 million $1.3 million $18.1 million under this policy in 2017-18 and no Report 2017-2018 Annual Health Eastern conversations with the ICN. BAU – Business as usual 33 CHALLENGES AND Evidence shows that the time patients spend in the OPPORTUNITIES emergency department (ED) Eastern Health operates within a impacts on their length of stay healthcare system that is constantly and on hospital mortality rates. evolving in response to a broad range As agreed in the Statement of of internal and external factors. Priorities, we aim for at least Changes in this environment often 81 per cent of patients to be KEY CHALLENGES present a range of challenges and moved from the ED in less than four Minimising variation and opportunities that must be considered hours. In short, overcrowding in eliminating harm and acted on to ensure we continue the emergency department leads to provide high-quality and safe care. to a poor patient experience and Equity of access in the face addressing this challenge requires a of changing demand During the past six years, Eastern whole-of-health service approach. Health has embedded a robust Consumer health literacy Many of these initiatives are and expectations of care Performance Excellence Framework happening outside the emergency (see page 16) in order to manage the department to reflect the notion Leadership and the workforce scope and volume of change across that every space (cubicle, bed, the organisation and to take advantage consulting room) and "every minute" Delivering services of opportunities. matters. Each piece of work is being sustainably undertaken using the Eastern Health Identifying and prioritising efforts Managing health information improvement methodology and and organisational knowledge towards those initiatives that will is documented and measured so deliver the greatest gains in health progress can be easily tracked. Utilising technology to outcomes for individuals and the enhance care delivery wider community receive significant Eastern Health is currently outcomes. attention. Our Strategic Plan,as implementing seven priority initiatives that focus on a range of outlined on pages 7-8, guides us in the For more information about clinical and non-clinical areas across decisions we make to achieve great Eastern Health’s challenges and the care delivery system and which health outcomes for our community. opportunities, and how we will are all dedicated to improving our respond to them effectively, emergency access performance. Providing timely access please refer to the Strategic Key outcomes have included an Plan 2017-2022 which is Eastern Health is committed to increase of 15 general medicine beds, available on our website at providing services in a timely four surgical beds, six paediatric beds www.easternhealth.org.au manner. In 2017-18, we continued and three emergency department the “Every Minute Matters” program cubicles at Box Hill Hospital. An of improvement work with a focus additional 17 sub-acute beds have on enhancing patient flowacross also been opened, with 12 in the the continuum of care, including GEM@Home program, which enables enhanced access to services provided earlier discharge home, including for in the home and community. patients returning to residential care.

Managing our risks

Eastern Health takes a balanced approach to risk management in order to ensure systematic identification, analysis, recording and reporting of risks and opportunities important to the achievement of our strategic initiatives, as outlined on page 16.

Eastern Health proactively and reporting, compliance, statewide, the potential to impact on the reactively addresses a broad inter-agency and project-based risks. achievement of desired results range of risks that may impact or See page 40 for representatives and outcomes. are impacting the organisation. on the committee. For more information about how Eastern Health's Risk and Audit Risk management is embedded in Eastern Health manages key risks, Committee has oversight of the day-to-day practice and all managers including case studies, please refer enterprise risk management system, and staff routinely manage risks, to the Quality Account 2018 at with a focus on the most significant including occupational health www.easternhealth.org.au. risks facing the organisation, including and safety (see pages 12-13) and Our Performance Our Our Performance Our strategic, operational, financial, quality of care matters that have 34 Committee structure Our Governance

Executive Committee Remuneration Committee Strategy, People Committee andITAdvisory Risk andAuditCommittee CommitteeAdvisory CarePrimary andPopulation Health Quality andSafety Committee Finance Committee CommitteeCommunity Advisory Board ofDirectors

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35 35 Eastern Health 2017-2018 Annual Report Organisational structure

Eastern Health introduced a new organisational structure in February 2017. There are eight directorates with responsibility for the management of organisational operating systems and organisational performance.

Executive Director People and Culture Katherine MacHutchison

Executive Director Eastern Health Research (Chief Medical Officer) Board Adj Clinical A/Prof Colin Feekery

Executive Director Learning and Teaching Chief Executive (Chief Nursing and Executive Assistant Midwifery Officer) Tracey de Jong Adjunct Professor Adj Clinical A/Prof Kath Riddell David Plunkett Executive Director Clinical Operations (ASPPPA) Office of the Acute and Aged Medicine, Maroondah Hospital Specialty Medicine Peter James Centre Chief Executive and Ambulatory Care, Wantirna Health Director Pathology, Pharmacy, Eastern Health Foundation Patient Access and Allied Health Matt Sharp Jason Smith

Chief Counsel Executive Director Sue Allen Clinical Operations (SWMMS) Surgery, Women and Children Angliss Hospital Director and Acute Specialist Clinics, Box Hill Hospital Corporate Governance Mental Health, Medical Imaging Yarra Ranges Health Alison Duncan-Marr and Statewide Services Karen Fox

Executive Director Quality, Planning and Innovation (Chief Allied Health Officer) Gayle Smith

Our nine clinical programs Executive Director (see page 11) are backed by Information, Technology and corporate and clinical support Capital Projects services. Clinical program and Zoltan Kokai site responsibilities are combined and organised to promote maximum service integration Executive Director and timely decision-making for Finance, Procurement and local and program requirements. Corporate Services (Chief Finance Officer and See pages 41-42 for information Chief Procurement Officer) Our Governance Our Our Governance Our about our Executive Committee. Peter Hutchinson

36 Board of Directors

Eastern Health is a public health service as defined by the Health Services Act 1988 and is governed by a Board of Directors, consisting of up to nine members, appointed by the Governor in Council on the recommendation of the Victorian Minister for Health.

The Board must perform its During 2017-18, Eastern Health’s Board Directors were: functions and exercise its powers DR JOANNA M FLYNN AM Independent Member of Audit subject to any direction given by Committee, Victorian Curriculum MBBS MPH HonDMedSc FRACGP FAICD the Minister for Health and subject and Assessment Authority to the principles contained within Appointed Chair of Eastern Health 1 July 2009 the Health Services Act 1988 and HON FRAN BAILEY Current professional positions Public Administration Act 2004. BAEd DipT (Secondary) GAICD Chair, Medical Board of Australia Appointed 1 July 2014 The Board provides governance of Chair, Health Service Board Chairs Eastern Health and is responsible for (Victoria) Current professional positions its financial performance, strategic Chair, Animal Aid Board Director, Ambulance Victoria directions, quality of healthcare Chair, National Emergency Honours services and strengthening community MR STUART ALFORD Director, National Board, Restaurant involvement through greater and Catering partnerships. BEcon(Hons) FCA MAICD Appointed 1 July 2009 Ambassador, Cascades National The Board is responsible for ensuring Retired 30 June 2018 Heritage Project, Second Bite and Eastern Health performs its functions the Gertrude Opera under section 65 of the Health Services Current professional positions Act 1988, including the requirement Director, Metropolitan Fire and PROFESSOR ANDREW to develop statements of priorities Emergency Services Board and strategic plans, and to monitor Director, AMES Australia CONWAY compliance with these statements Deputy Chair and Director, FIPA FFA FCMA FCPA (UK) MAICD FAIM and plans. The Board also has Kilvington Grammar BCom BTeach(Sec) Appointed 1 July 2011 responsibility for the appointment Director, Scoroband Pty Ltd of the Chief Executive. Chair of Audit Committee, Office Current professional positions Chief Executive Officer, Institute The Eastern Health by-laws enable of the Australian Accounting of Public Accountants the Board to delegate certain Standards Board authority. The by-laws are supported Chair of Audit Committee, Office Professor of Accounting by the Delegations of Authority, of the Australian Auditing and (honoris causa), Shanghai University enabling designated executives and Assurance Standards Board of Finance and Economics staff to perform their duties through Deputy Chair of Audit and Risk Vice-Chancellor’s Distinguished exercising specified authority. Committee, Department of Fellow, Deakin University Education and Training Adjunct Professor, Deakin University The Directors contribute to the governance of Eastern Health Independent Chair, Pitcher Partners Adjunct Professor, Langzhou collectively as a Board. The Board Network Audit Review Panel University of Technology normally meets monthly and 12 meetings are scheduled each Meetings eligible Meetings financial year. Board Directors to attend attended Eastern Health welcomed Dr Peter Dr Joanna Flynn AM 13 12 Dohrmann and Ms Joanna Walker as Mr Stuart Alford 13 11 Hon Fran Bailey 13 12 Board Directors in July 2017 while the Prof Andrew Conway 12 10 appointments of Mr Stuart Alford and Dr Peter Dohrmann 13 13 Professor Pauline Nugent expired on Ms Jill Linklater 13 13 30 June 2018 after the maximum of Mr Tass Mousaferiadis 13 12 nine years’ service to Eastern Health. Prof Pauline Nugent 13 11 In January 2018, Mr Lance Wallace was Ms Joanna Walker 13 13 appointed as the Minister for Health’s

Prof Conway was reappointed on 1 August 2017, therefore he was eligible to attend Report 2017-2018 Annual Health Eastern Delegate to the Board of Directors. 12 meetings. 37 Board of Directors

DR PETER DOHRMANN PURPOSE, FUNCTIONS, MBBS FRACS GradDipOccEnvH FRACMA POWERS AND DUTIES Appointed 1 July 2017 Eastern Health’s core objective is CLINICAL Professional positions to provide public health services GOVERNANCE Director of Neurosciences, in accordance with the principles FRAMEWORK Epworth HealthCare established as guidelines for the Senior Clinical Adviser, Australian delivery of public hospital services Clinical governance is the Health Practitioner Regulation Agency in Victoria under section 17AA of system by which Eastern the Health Services Act 1988. Health, including the MS JILL LINKLATER The other objectives of Eastern Board, the Quality and RN BScN MHA Grad Dip Health & Health, as a public health service, Safety Committee and Medical Law FACN FGIA GAICD are to: the Executive, managers, clinicians and staff, Appointed 1 July 2016 Provide high-quality health services share responsibility and Current professional positions to the community which aim to Board Member, Chair of Community meet community needs effectively accountability for the Advisory Committee, Member of and efficiently quality of care delivered Clinical Governance Committee and across our services. Integrate care as needed across Governance Committee, Uniting service boundaries, in order to This includes elements such as AgeWell (Victoria and Tasmania) achieve continuity of care and continuously improving services, Member, Disability Services promote the most appropriate minimising risks and fostering Board Victoria level of care to meet the needs an environment of excellence Member, Deakin University Centre of individuals in care for consumers, patients for Quality and Patient Safety and residents. (QPS) Research External Advisory Ensure that health services Committee are aimed at improvements Eastern Health’s Clinical in individual health outcomes Consultant, Health, Disability, Governance Framework is and population health status by Aged Care Services aligned with the Department allocating resources according to of Health and Human Services Management Systems Auditor best-practice healthcare approaches and Accreditation Surveyor framework under five domains Ensure that the health service – Leadership and Culture, MR TASS MOUSAFERIADIS strives to continuously improve Consumer Partnerships, quality and foster innovation BEd Grad Dip HealthEd Grad Cert Workforce, Risk Management and Clinical Practice. BusMgt GAICD Support a broad range of Appointed 8 December 2015 high-quality health research to The Department recently Professional positions contribute to new knowledge released a new framework. and take advantage of knowledge Board Member, Victorian Eastern Health is currently gained elsewhere Responsible Gambling Foundation reviewing and updating its Board Member, FoodBank Victoria Operate in a business-like manner Clinical Governance Framework Vice President, Star Health which maximises efficiency, to ensure it aligns with this effectiveness and cost-effectiveness, new version. See page 24 for and ensures the financial viability more information. PROFESSOR PAULINE of the health service NUGENT BAppSc (Nursing Ed) Med Ensure that mechanisms are available to inform consumers and Appointed 1 July 2009 protect their rights, and to facilitate Retired 30 June 2018 consultation with the community Professional position Provost, Australian Catholic University Operate a public health service, as authorised by or under the Act MS JOANNA WALKER Carry out any other activities that BBus(Acc) MBA GAICD may be conveniently undertaken in Appointed 1 July 2017 connection with the operation of a public health service or calculated Professional positions to make more efficient any of the Board Member and Member of health service’s assets or activities. the Audit and Risk Committee, Southern Alpine Resort Management

Our Governance Our Director, Kapstone Pty Ltd For more information, please refer to our performance against strategic priorities on pages 17-25. 38 Board committees

In accordance with the Health Services Act 1988, the Board of Directors is supported by several committees and advisory committees. The responsibilities of each committee are set out in its terms of reference.

Each committee is required to For more information about the The Quality and Safety Committee is report to the Board through Community Advisory Committee, responsible to the Board for ensuring its minutes and may make visit www.easternhealth.org.au that safe, effective and accountable systems are in place to monitor and recommendations. At its meetings, improve the quality and safety of the Board discusses the committee FINANCE COMMITTEE health services provided by Eastern minutes that are introduced by Chair: Health and that any systemic problems the relevant Committee Chair. Mr Stuart Alford identified with the quality and safety of health services are addressed Members: in a timely manner. It also ensures COMMUNITY ADVISORY Hon Fran Bailey Eastern Health strives to continuously COMMITTEE (from September 2017) improve quality and safety and foster Dr Joanna Flynn AM innovation; and that clinical risk and Chair: Prof Andrew Conway patient safety are managed effectively. Mr Tass Mousaferiadis Ms Joanna Walker The committee has assisted the Board (from September 2017) Members: to exercise its clinical governance Dr Peter Dohrmann Mr Tass Mousaferiadis responsibility throughout the year. (from September 2017) (until September 2017) Hon Fran Bailey The primary function of the Finance (until September 2017) Committee is to assist the Board in PRIMARY CARE AND Adj Prof David Plunkett fulfilling its responsibilities to oversee POPULATION HEALTH Eastern Health’s assets and resources. The role of the Community Advisory It reviews and monitors the financial ADVISORY COMMITTEE Committee is to provide direction performance of Eastern Health in Chair: and leadership in relation to the accordance with approved strategies, Ms Jill Linklater integration of consumer, carer and initiatives and goals. community views at all levels of health Members: The committee makes service operations, planning and policy Dr Joanna Flynn AM recommendations to the Board development, and to advocate to the Adj Prof David Plunkett regarding Eastern Health’s Board on behalf of the community, financial performance, financial Ms Sandy Austin consumers and carers. commitments and financial policy. Regional Director, Eastern Metro Members of the committee representing The committee normally meets Health, Department of Health and the community in which Eastern Health monthly and 11 meetings are Human Services scheduled each financial year. operates are Ms Sue Emery, Ms Diane Mr John Ferraro Fisher, Ms Angela Fitzpatrick, Ms Liz The committee has assisted the Board Program Director, Acute and Aged Flemming-Judge, Ms Raj Liskaser, to exercise its financial stewardship Medicine, Eastern Health Ms Tarnya McKenzie, Ms Gloria Sleaby responsibility throughout the year. and Mr Shan Thurairajah. Ms Kathy Ms Ronda Jacobs Collet, a Carer Consultant in the Mental Chief Executive, Carrington Health Health Program, is an associate of the QUALITY AND SAFETY Prof Danielle Mazza committee. COMMITTEE Head of the Department of General In 2017-18, some of the activities Chair: Practice, Monash University Prof Pauline Nugent that members participated in Mr Matt Sharp included ongoing involvement in Members: Executive Director, Clinical Operations numerous expert advisory committees, Dr Peter Dohrmann (ASPPPA), Eastern Health governance committees and quality (from September 2017) Ms Robin Whyte improvement projects, as well as Mr Tass Mousaferiadis involvement in organisational planning Chief Executive, Eastern Melbourne Ms Jill Linklater and assisting with the preparation Primary Health Network

Ms Liz Flemming-Judge Report 2017-2018 Annual Health Eastern of the annual Quality Account. (community representative) Continued on page 40 39 Board committees

The role of the Primary Care and Liaison with the Victorian Auditor- Development and implementation Population Health Advisory Committee General or the Auditor-General’s of Eastern Health’s annual is to monitor and report to the Board nominee, as required Statement of Priorities, agreed with on the effective implementation of the the Victorian Minister for Health Internal auditor’s qualifications, Primary Care and Population Health performance, independence Monitoring implementation of Plan and any barriers to its successful and fees the People Strategy, Research implementation. Plan and Great Digital Information Financial reporting and statutory In accordance with the requirements Management and Transformation compliance obligations of Eastern of section 65ZC of the Health Services Strategy Health. Act 1988, the committee consists of Planning and monitoring of major members who between them have: The committee also assists the Board capital works and projects. in relation to oversight and review of Expertise in or knowledge of the risk management, occupational health In 2017-18, the committee focused provision of primary health services on the development of the People and safety, and legislative compliance. in the areas served by Eastern Health Strategy 2018-2022 and Research Plan In accordance with the Standing 2018-2022, implementation of the Expertise in identifying health Directions of the Minister for Finance Great Digital Information Management issues affecting the population under the Financial Management Act and Transformation Strategy and a served by Eastern Health and 1994, the committee is comprised number of other projects, including designing strategies to improve of three or more Board Directors. the development of service and capital the health of the population All members are independent. planning, and master planning for Knowledge of the health services various sites. The committee has assisted the provided by local government in Board to exercise its financial and The committee also monitored the the areas served by Eastern Health. risk management responsibility implementation of the Electronic Activities in 2017-18 included throughout the year. Medical Record (see page 23). monitoring the implementation of the Eastern Melbourne Primary Healthcare Collaborative Primary Health Strategic STRATEGY, PEOPLE REMUNERATION Plan (see page 22). Eastern Health AND IT ADVISORY COMMITTEE is a founding partner of the Eastern COMMITTEE Chair: Melbourne Primary Healthcare Dr Joanna Flynn AM Collaborative. Chair: Hon Fran Bailey Members: Prof Andrew Conway Members: RISK AND AUDIT Mr Tass Mousaferiadis Dr Peter Dohrmann COMMITTEE (from September 2017) The primary purpose of the Chair: Ms Jill Linklater Remuneration Committee is to Prof Andrew Conway Adj Prof David Plunkett assist the Board to discharge its responsibilities under government Members: The Strategy, People and IT Advisory policy in relation to the remuneration Mr Stuart Alford Committee is responsible to the of the Chief Executive and members Hon Fran Bailey Board for monitoring the performance of the Executive. of Eastern Health with regard to: Mr Tass Mousaferiadis The committee assisted the Board Ms Joanna Walker Development, implementation and to fulfil its obligations with respect (from September 2017) monitoring of progress on Eastern to Executive emr uneration. The purpose of the Risk and Audit Health’s Strategic Clinical Service Committee is to assist the Board to Plan and Strategic Plan discharge its responsibilities by having Development, implementation oversight of the: and monitoring of progress on Integrity of the financial statements designated Corporate Plans in and financial reporting systems of accordance with Eastern Health’s Eastern Health integrated planning framework Our Governance Our

40 Executive

ADJUNCT PROFESSOR He entered management after PETER HUTCHINSON successfully completing a Master DAVID PLUNKETT of Health Administration and Executive Director Chief Executive subsequently, was admitted as a Finance, Procurement Fellow to the Royal Australasian and Corporate Services David has worked at Eastern Health College of Medical Administrators. (Chief Finance Officer and since 2002 and was appointed He is currently a censor and Chief Procurement Officer) Chief Executive in September 2016. national examiner for the college. Peter commenced at Eastern Health David is responsible to the Board of He has previously held senior in 2000. He is responsible for Eastern Directors for the overall management management positions at the Royal Health’s financial services, management and performance of Eastern Health. Children’s Hospital (Melbourne) accountant services, procurement and Prior to this appointment, David was and Western Health. the Executive Director of Acute Health/ supply, facilities and infrastructure, Chief Nursing and Midwifery Officer, security, property and retail. along with a number of other roles. KAREN FOX Peter has held a variety of roles in the public health system during the past David’s focus on the patient and Executive Director 25 years and fulfils the functions of outcomes has been enhanced by his Clinical Operations (SWMMS) – Eastern Health’s Chief Finance Officer work as a surveyor with the Australian Surgery, Women and Children and Chief Procurement Officer. He holds Council on Healthcare Standards. and Acute Specialist Clinics, a Bachelor of Commerce (Accounting, Mental Health, Medical Imaging Economics) and is a fellow of the Prior to joining Eastern Health, David and Statewide Services held senior roles at Epworth Richmond Australian Health Services Financial and Latrobe Regional Hospital. Karen commenced at Eastern Health Management Association. He holds a Master of Business in 2006 and was appointed to her Administration and is a fully qualified current role in February 2017. Prior perioperative (theatre) nurse. to this, she held the position of ZOLTAN KOKAI Executive Director of Access and Executive Director Patient Support Services since May Information, Technology and 2013. Karen is responsible for the ADJUNCT CLINICAL Capital Projects ASSOCIATE PROFESSOR management and performance of surgery, women and children Zoltan commenced at Eastern Health in COLIN FEEKERY services, acute specialist clinics, July 2004. He was appointed to his current Executive Director mental health, medical imaging and role in February 2017 and leads the information, technology and major capital Research statewide services. projects functions, including information (Chief Medical Officer) She is committed to listening to and communication technology, health Colin was appointed to the position of staff, patients, clients and consumers information and decision support services, Chief Medical Officer at Eastern Health to ensure Eastern Health is biomedical engineering, the library and in July 2008. In February 2017, Colin’s providing reliable, safe, high-quality the e-health team, which successfully led role was changed to emphasise the care and positive experiences. the introduction of an Electronic Medical organisation’s commitment to research. Karen’s previous roles at Eastern Record under the digital transformation Health have included capital strategy. Colin is currently mandated to grow project management, corporate and develop research and has ongoing governance, strategy, planning Zoltan has led the Angliss Hospital responsibility for the management and risk management. Karen has expansion and the Eastern Health and future planning of the medical also worked in country Victoria Breast and Cancer Centre capital works workforce. He also manages Eastern and at Bayside Health. She has a project. He previously led Maroondah Health’s medico-legal service. Bachelor of Applied Science (Health Hospital and Eastern Health’s acute and By training, Colin is a paediatrician Information Management), a Master community health services. and he is a Fellow of the Royal of Public Health and a Diploma of Prior to joining Eastern Health, Zoltan Australasian College of Physicians. Management. held several executive and senior roles at a number of major metropolitan health services. He has undergraduate degrees in business and information systems, and a Master of Business Administration. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

41 Executive

KATHERINE MATT SHARP EASTERN HEALTH MACHUTCHISON Executive Director FOUNDATION Executive Director Clinical Operations (ASPPPA) – Our Foundation helps realise our People and Culture Acute and Aged Medicine, communities’ aspirations for great Specialty Medicine and healthcare through philanthropy. Katherine commenced at Eastern Ambulatory Care, Pathology, Health in April 2017. She is Pharmacy, Patient Access and Below are just some of the areas responsible for Eastern Health’s Allied Health where this generosity has made human resources services, a difference. Matt commenced at Eastern Health occupational health and safety in 2014 as the Executive Director Stopping breast cancer and emergency management, of Continuing Care, Ambulatory, communications and volunteer Mental Health and Statewide in its tracks services. She holds a Graduate Services, and commenced his Any test, let alone a breast cancer Diploma in Human Resources current role in February 2017. test, can be a confronting experience Management and Industrial The Clinical Operations (ASPPPA) but thanks to generous individuals, Relations, and a Bachelor of Arts. directorate comprises acute businesses and community groups, (emergency and general medicine) more women will have access to the Katherine has also worked at latest 3D cancer detection technology. Epworth Healthcare, the Department and aged (sub-acute, transition care, residential aged care, chronic Their support will enable the purchase of Business and Innovation, Cancer disease) medicine, specialty of new 3D mammography equipment Institute NSW, Mayne Health, medicine and ambulatory care, which can detect up to 40 per cent Australian Hospital Care and Coles pathology, pharmacy, patient more cancers than 2D scans. This Myer Limited. access and allied health. The focus equipment, to be located at the new of this role is to ensure patients Eastern Health Breast and Cancer CLINICAL ASSOCIATE move seamlessly between different Centre, will be available to women services across Eastern Health. from across our catchment and along PROFESSOR the spectrum of breast cancer care. KATH RIDDELL A registered nurse by profession, Matt was previously the Chief Looking towards the future Executive Director Executive of Rochester and through research Learning and Teaching Elmore District Health Service. A record $500,000 was awarded in this (Chief Nursing and Midwifery He has considerable leadership, year’s Research and Innovation Grants Officer) management and clinical experience in both regional and Program thanks to our donors. This will Kath commenced at Eastern Health rural Victoria. provide researchers from a range of in 2008 and was appointed to her disciplines the opportunity to discover current role in February 2017. treatments and explore medical This role encompasses two portfolios GAYLE SMITH practices that can provide immediate – learning and teaching for all clinical benefits to patients. The depth and Executive Director staff and professional lead for the breadth of research conducted through Quality, Planning and Innovation nursing and midwifery workforce. this program extends across all aspects (Chief Allied Health Officer) Kath has always been committed of healthcare, including surgery, aged to developing and supporting Gayle commenced at Eastern care, emergency, drug and alcohol, oncology and mental health. clinicians with first-class learning Health in February 2010. Her role opportunities, so patients receive includes responsibility for Eastern the highest standard of clinical care Health’s performance excellence, Our wonderful auxiliaries and outcomes, and students are strategy, planning and risk Auxiliary members give vital support supported to embrace a life-long management, clinical governance, to our patients, their families and our learning philosophy. quality and safety, consumer and staff by providing a friendly smile and community participation, and helping hand. They also raise valuable She believes this role is a truly continuous improvement systems. funds through activities such as hospital unique opportunity to create a new kiosks and opportunity shops. Our Gayle also has professional inter-professional learning culture auxiliaries raised $285,000 in 2017-18 responsibility for Allied Health. at Eastern Health. Prior to her for new medical equipment, including Gayle holds a Bachelor of Applied appointment, Kath was the Director operating theatre tables and patient Science (Occupational Therapy), a of Practice Development and monitors in the emergency department. Master of Business Administration Workforce at Eastern Health since and a Professional Certificate in 2011 and Deputy Chief Nursing and Health System Management. Midwifery Officer since 2014. To find out more about the Eastern

Our Governance Our Health Foundation, visit its website at www.easternhealth.org.au/foundation 42 Our People

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43 43 Eastern Health 2017-2018 Annual Report Working at Eastern Health

Eastern Health’s Strategic Plan 2017-2022 has a bold and powerful vision to provide “great care, everywhere, every time”. Delivery of this exciting vision will depend on many factors but at the heart of it are our people.

Our people are the key to ongoing Safety and wellbeing Highlights success and we must support We will have a safety-focused them to thrive, manage and lead. culture that prioritises the health It is also critical for us to attract, and emotional wellbeing of our develop and retain the best employees. people who will put patients Secure and diverse workforce first in everything they do. We will build a secure and diverse Eastern Health is operating in a workforce to ensure we have rapidly-changing global environment, employees who are available, skilled which significantly affects our and engaged, so that we can service workplace. Expected technological our community in the short and 43.16 advancements in digital health and long term. average age of the cognitive cloud will impact how employees and where we provide healthcare. Communications and brand We will continue to strengthen In addition, growing demand for our our communications and the services and the increasing expectations Eastern Health brand to ensure our 18 of our community will require a employees feel informed, heard and age of youngest workforce that is resilient, agile and inspired to work at Eastern Health. employee patient-focused. (ward clerk) Our new People Strategy 2018-2022, approved in March 2018, outlines an OUR VALUES integrated approach to creating an In 2017, for the first time in 17 85 environment in which our people can years, Eastern Health’s values were age of oldest employee flourish and succeed in delivering reimagined. (visiting medical officer) Eastern Health’s vision. This strategy will

develop excellence in seven key areas: Patients First Agility 78% Engagement Humility percentage of workforce We will have a passionate, engaged and empowered workforce that lives Respect that is female our values and brings our vision and Kindness mission to life. Excellence 82 Leadership These values inform the way staff number of nationalities We will develop our leaders to inspire think, act and speak, and shape that make up the our employees to deliver great care, workplace culture. To support staff Eastern Health everywhere, every time. to have a strong understanding of each of the six values, more than workforce Attraction and recruitment 850 staff were asked to provide We will recruit the best people feedback about what each value and be a career destination for means to them and what each value 22 high-performing healthcare talent. looks like in action. number of staff who Performance As a result of this robust identify as Aboriginal We will enable our employees consultation, each value was and Torres Strait Islander to thrive through meaningful defined with observable behaviours, conversations focused on performance as outlined on page 8. There were no staff who identified as Our People Our and development. other than male or female.

44 Working at Eastern Health

To further embed these values, Research indicates employee each value was awarded to a engagement drives healthcare nominated staff member as part quality, patient experience and of the 2017 Aspire to Inspire (A2i) financial returns and as such is a Awards (see page 48). Furthermore, key measure for Eastern Health. the values are embedded within Survey results have been shared annual performance appraisals, our with staff and action plans recruitment processes and tools, developed for 100 per cent of and in the design of our upcoming Eastern Health’s programs and leadership development program. directorates. Work will continue over the next 12 months to ensure these values come to life and resonate with our staff. LEADERSHIP Edwina Wong and Darpi Patel are helping to prevent patient falls on Ward 9.1 at Box Hill FRAMEWORK Hospital, as part of the Falls Prevention and Eastern Health has developed a Wellbeing Program, one of many programs ATTRACTION AND that benefit from volunteer assistance. They RECRUITMENT leadership framework that is aligned are pictured with patient Janice Jaboor. with our Strategic Plan. A success As part of our commitment to profile has been developed at each high-quality recruitment, a leadership level of the organisation significant piece of work has been Our volunteers through a rigorous focus group completed to develop values-based, and validation process. best-practice recruitment processes. These improvements have included Participants were required to In 2017-18 a systems upgrade, increased define the knowledge, experiences, reporting and refined processes that competencies and personal are aimed at reducing the length of attributes required for success. 870 time to fill positions and ensure a This framework will guide volunteers supported high-quality candidate experience. our leadership development, recruitment and performance In addition, a suite of recruitment development processes, and 106 tools and templates were developed, ensure Eastern Health has the programs, enabling our leaders to recruit leadership to deliver on current contributing high-quality employees who align and future objectives. with our values and are a good fit for Eastern Health. A full-day recruitment 208,800 workshop focusing on values and SAFETY LEADERSHIP hours of service. behaviours, and the recruitment Developing safety leadership lifecycle was also designed to While the dollar value to Eastern capability is a key goal that Eastern develop the recruitment capability Health equates to $5.02 million, the Health endeavours to undertake of our managers. qualitative value is immeasurable in to effectively achieve its strategic terms of the difference this workforce initiative of being “a values-based, makes to the lives of our patients, ENGAGEMENT safe workplace” as well as “a carers, staff and the community. high-performing organisation”. The People Matter Survey has Work is underway to develop a Our volunteers provide support for a been distributed to Eastern Health safety leadership program to range of services and programs across employees by the Victorian Public enable managers to provide Eastern Health. These include acting Service Commission since 2012. strong leadership in driving a as welcome ambassadors, assisting In 2017, Eastern Health achieved a culture of safety. staff and patients in the emergency response rate of 41 per cent, which department, cancer services, was a five per cent increase on 2016. The challenge for Eastern Health palliative care, falls prevention and The People Matter Survey measures leaders is not only to improve the wellbeing, rehabilitation, mental employee engagement and job safety of their employees but also to health, spiritual care, medical imaging, satisfaction (see page 28 for some develop the competencies, skills and respiratory laboratory, nutrition key results). behaviours to build high-performing, services, patient transport, the patient engaged and empowered teams. library,t pe therapy visits, aged care Programs will be developed for activities and hospital in the home. three levels of the organisation, In addition, in early 2018 a new including team leader, manager group of dedicated volunteers was and director. recruited to assist patients and staff at the newly-opened Eastern Health Breast and Cancer Centre. Report Report 2017-2018 Annual 2017-2018 Annual Health Health Eastern Eastern

45 Working at Eastern Health

Workforce data

2013-14 2014-15 2015-16 2016-17 2017-18 Full-Time 2675 2628 2681 2726 2748 Part-Time 4720 4854 4982 5249 5403 Casual 1119 1201 1393 1462 1279

TOTAL 8514 8683 9056 9437 9430

Most of our staff members work in the areas of nursing, medical, allied health and clinical support services, such as physiotherapy, occupational therapy, medical imaging and pathology. They are complemented by corporate, administrative and clerical staff. There has been a steady rise in the number of staff during the past five years as a result of increased demand, expanding programs and services, and the opening of new facilities and beds.

June June Current month FTE Year to date FTE Labour category 2017 2018 2017 2018 Nursing 2822.9 2859.32 2741.5 2819.94 Administrative and clerical 905.6 886.03 889.8 890.85 Medical support* 574.1 573.89 558.5 571.96 Hotel and allied services 315.4 310.65 310.1 316.12 Medical officers 124.7 121.12 117.1 120.35 Hospital medical officers 595.3 619.54 578.4 610.18 Sessional clinicians 180.5 210.55 177.7 192.58 Ancillary staff (allied health) 597.9 590.83 578.6 588.35

These figures exclude overtime. They do not include contracted staff i.e. agency nurses or fee-for-service visiting medical officers who are not regarded as employees for this purpose.

Breakdown of workforce – full-time equivalent staff

Labour category 2013-14 2014-15 2015-16 2016-17 2017-18 Nursing 2564.9 2611.5 2697.2 2822.9 2859.32 Administrative and clerical 842.1 851.2 857.0 905.6 886.03 Medical support* 516.5 499.5 549.6 574.1 573.89

Hotel and allied services 284.1 293.1 297.7 315.4 310.65 Medical officers 112.7 120.0 115.0 124.7 121.12 Hospital medical officers 513.4 526.3 562.5 595.30 619.54 Sessional clinicians 150.2 155.1 176.7 180.5 210.55 Ancillary staff (allied health) 578.3 549.6 557.7 597.9 590.83 TOTAL 5562.2 5603.2 5813.4 6116.4 6171.93

* The medical support services category includes health professionals such as physiotherapists, speech pathologists, radiographers and medical scientists. Employees have been correctly classified in workforce data collections. Our People Our

46 Working at Eastern Health

Workforce age breakdown 2017-18

22.56% 26.45%

Age group Number of <20 (years) staff Percentage 20-29 <20 5 0.05 30-39 20-29 1635 17.34 40-49 30-39 2494 26.45 50-59 40-49 2127 22.56 60-69 70-79 50-59 2019 21.41 80-89 60-69 1054 11.18 17.34% 0.03% 70-79 93 0.99 0.05% 80-89 3 0.03 0.99% TOTAL 9430 100 21.41% 11.18%

INDUSTRIAL RELATIONS There has not been any industrial Our people policies and procedures action taken by employees during support: During 2017-18, Eastern Health had these negotiations and therefore Employment decisions based a number of enterprise bargaining there has been no lost time due to on merit agreements renegotiated or in the industrial action. process of renegotiation. People being treated fairly and reasonably The Fair Work Commission EMPLOYMENT AND approved the: CONDUCT PRINCIPLES Provision of equal opportunity Victorian Public Health Sector Eastern Health is an equal opportunity Human rights, as set out in the (Medical Scientists, Pharmacists employer and treats all our staff and Victorian Charter of Human Rights and Psychologists) Single Interest potential employees on their merits and Responsibilities Act 2006 Enterprise Agreement 2017-2021 and without consideration of race, People being provided with At the time of writing this report, gender, age, marital status, religion reasonable redress against unfair the following Agreements were or any other factor that is unlawfully or unreasonable treatment currently before the Fair Work discriminatory. Commission awaiting approval: Fostering career pathways in the We are committed to providing a public healthcare sector. AMA Victoria – Victorian Public workplace that is free of discrimination Health Sector – Medical Specialists and harassment. Any form of unlawful Enterprise Agreement 2018-2021 discrimination or harassment is unacceptable and disciplinary action AMA Victoria – Victorian Public will be taken against any staff member Health Sector – Doctors in Training who breaches this policy. Enterprise Agreement 2018-2021 We are committed to the employment Victorian Public Health Sector principles outlined in the Victorian (Maintenance) Multi-Employer Government’s Public Administration Agreement 2017-2021. Act 2004, which are essential to an Negotiations have commenced for a effective and harmonious workplace. new biomedical engineers enterprise bargaining agreement. Eastern Health 2017-2018 Annual Report Report 2017-2018 Annual 2017-2018 Annual Health Health Eastern Eastern

47 Workforce at Eastern Health

Reward and recognition NURSING AND Our reward and recognition framework, incorporating the annual Aspire to Inspire MIDWIFERY AWARDS (A2i) Awards, Nursing and Midwifery Awards, and site/program employee awards, Eastern Health is committed to as well as the provision of guidelines for local everyday reward and recognition, recognising and rewarding our helps us to build a values-based, high-performing culture at Eastern Health. We also exceptional nurses and midwives, seek recognition for our dedicated staff at a state, national and international level. and holds the Nursing and Midwifery Awards and Graduation Ceremony every year in between International Day of the Midwife and International Nurses Day celebrations in May. In 2018, the award recipients were:

Chief Nursing and Midwifery Officer Award: Stephen Bowness Registered Nurse, Maroondah PARC (Prevention and Recovery Care), Top honours for emergency departments Mental Health Program Kirsty Medo Registered Nurse, Ranges Community Box Hill Hospital was named Australasian Emergency Department of the Year by Care Team, Mental Health Program thee Colleg of Emergency Nursing Australasia (CENA) in October 2017. Key criteria Graduate Nurse/Midwife of the for the award included demonstrated excellence in patient care and clinical Year (Penny Newsome Medal): outcomes; commitment to professional development of staff; and commitment to quality management. Director of Emergency Services Andrew Maclean said Juliet Waters the award was a great reflection on the outstanding job our dedicated staff Registered Nurse, Special Care do each and every day. Pictured above is the award-winning team. Nursery, Box Hill Hospital A partnership between Eastern Health’s Mental Health team and Angliss Hospital’s Postgraduate Nurse/Midwife of the Emergency Department was recognised at the prestigious Victorian Public Year (DeVoil Medal): Healthcare Awards. A world-first initiative, the telepsychiatry program involved Amy Skiller providing real-time clinical mental health support via video link to the hospital’s Registered Nurse, Operating Theatres, emergency department. The program won the Minister for Mental Health’s Award Maroondah Hospital for Excellence in Supporting the Mental Health and Wellbeing of Victorians. Preceptor of the Year (Heather Beanland Award): Jayne Nixon Registered Nurse, Intensive Care Unit, A2i AWARDS Box Hill Hospital About 400 staff and guests attended Eastern Health’s seventh annual Aspire to Inspire (A2i) Awards where the outstanding contributions of our staff and volunteers Deakin University Chair in Nursing were acknowledged. Long-time staff members who marked 25, 30, 35 and 40 years Research Award: of service were also recognised at the red carpet event. Nominees from across all Penny Casey sites and programs were acknowledged for their commitment to exemplifying our Clinical Nurse Educator and PhD new values – Patients First, Kindness, Respect, Excellence, Agility and Humility – Candidate, Learning and Teaching, as well as key strategic priorities.See winners’ photo below. Box Hill Hospital

Winners of the 2017 Aspire to Inspire (A2i) Awards are, from left, Dr Timothy McIver (Excellence), Kathryn MacDonald (Kindness), Cath Hunkin and Jenny Wray (both seated), representing Angliss Hospital’s Ward 2 West nursing team (Agility), Daniel Raftis (Humility), June Goudie (Volunteer), Anna Pagram (Workplace Safety and Wellbeing), Paul Roberts (Sustainability), Chris Bruce (Consumer Participation), Brad Wynne (Respect), Georgie Shoebridge (Patients First) and Kate Locastro (Closing the Health Gap). Our People Our

48 Disclosure Index

The Eastern Health Annual Report 2017-18 is prepared in accordance with all relevant Victorian legislation. This index has been prepared to facilitate identification of Eastern Health’s compliance with statutory disclosure requirements.

Page Legislation Requirement reference

Charter and purpose FRD 22H Manner of establishment and the relevant Ministers 1

FRD 22H Purpose, functions, powers and duties 38

FRD 22H Initiatives and key achievements 17-25

FRD 22H Nature and range of services provided 10-11

Management and structure FRD 22H Organisational structure 36

Financial and other information FRD 10A Disclosure index 49-50

FRD 11A Disclosure of ex-gratia expenses N/A

FRD 21C Responsible person and executive officer disclosures 101-102

FRD 22H Application and operation of Protected Disclosure Act 2012 31

FRD 22H Application and operation of Carers Recognition Act 2012 31

FRD 22H Application and operation of Freedom of Information Act 1982 31

FRD 22H Compliance with building and maintenance provisions of Building Act 1993 33

FRD 22H Details of consultancies over $10,000 32

FRD 22H Details of consultancies under $10,000 32

FRD 22H Employment and conduct principles 47

FRD 22H Information and communication technology expenditure 33

FRD 22H Major changes or factors affecting performance 2-4

FRD 22H Occupational violence 12

FRD 22H Operational and budgetary objectives and performance against objectives 4

FRD 24C Summary of environmental performance 30

FRD 22H Significant changes in financial position during the year 4

FRD 22H Statement on National Competition Policy 33 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern Continued on page 50 49 Disclosure Index

Page Legislation Requirement reference

FRD 22H Subsequent events 107

FRD 22H Summary of the financial results for the year 5

FRD 22H Additional information available on request 32 Workforce data disclosures including a statement on the application of employment and FRD 22H 46-47 conduct principles

FRD 25C Victorian Industry Participation Policy disclosures 33

FRD 29B Workforce data disclosures 46-47

FRD 103F Non-financial physical assets 76-84

FRD 110A Cash flow statements 59

FRD 112D Defined benefit superannuation obligations 74

SD 5.2.3 Declaration in report of operations 1

Other requirements under Standing Directions 5.2 SD 5.2.2 Declaration in financial statements 53

SD 5.2.1(a) Compliance with Australian Accounting Standards and other authoritative pronouncements 61

SD 5.2.1(a) Compliance with Ministerial Directions 61

Legislation Freedom of Information Act 1982 31

Protected Disclosure Act 2012 31

Carers Recognition Act 2012 31

Victorian Industry Participation Policy Act 2003 33

Building Act 1993 33

Financial Management Act 1994 33

Safe Patient Care Act 2015 31 Disclosure Index Disclosure

50 Statements Our Financial 2017-2018

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51 51 Eastern Health 2017-2018 Annual Report Contents

Board Member’s, Accountable Officer’s and Chief Finance & Accounting Officer’s Declaration 53 Auditor-General’s Report for the Year ended 30 June 2018 54 Comprehensive Operating Statement for the Year ended 30 June 2018 56 Balance Sheet as at 30 June 2018 57 Statement of Changes in Equity for the Year ended 30 June 2018 58 Cash Flow Statement for the Year ended 30 June 2018 59 Basis of Presentation 60 Note 1 Summary of significant accounting policies 61 Note 2 Funding delivery of our services 63 Note 2.1 Analysis of revenue by source 63 Note 3 The Cost of delivering services 67 Note 3.1 Analysis of expenses by Source 67 Note 3.2 Analysis of expense and revenue by internally managed and restricted specific purpose funds 71 Note 3.3 Finance costs 71 Note 3.4 Provisions Employee benefits in the balance sheet 72 Note 3.5 Superannuation 74 Note 4 Key Assets to support service delivery 75 Note 4.1 Investments and other financial assets 75 Note 4.2 Property, plant & equipment 76 Note 4.3 Depreciation and amortisation 85 Note 4.4 Intangible assets 86 Note 5 Other assets and liabilities 87 Note 5.1 Receivables 87 Note 5.2 Inventories 88 Note 5.3 Other liabilities 89 Note 5.4 Prepayments and other non-financial assets 89 Note 5.5 Payables 90 Note 6 How we finance our operations 91 Note 6.1 Borrowings 91 Note 6.2 Non-cash financing and investing activities 92 Note 6.3 Cash and cash equivalents 92 Note 6.4 Commitments for expenditure 93 Note 7 Risks, contingencies & valuation uncertainties 94 Note 7.1 Financial instruments 94 Note 7.2 Net gain/ (loss) on disposal of non-financial assets 96 Note 7.3 Contingent assets and contingent liabilities 97 Note 8 Other disclosures 98 Note 8.1 Equity 98 Note 8.2 Reconciliation of net result for the year to net cash inflow/(outflow) from operating activities 99 Note 8.3 Operating segments 100 Note 8.4 Responsible persons disclosures 101 Note 8.5 Executive officer disclosures 102 Note 8.6 Related parties 102 Note 8.7 Remuneration of auditors 103 Note 8.8 AASs issued that are not yet effective 104 Note 8.9 Events occurring after the balance sheet date 107 Note 8.10 Economic dependency 107 Glossary of terms and style conventions 108 Financial Statements Financial Note 8.11

52 (Box 9 Chair Dr We authorise the attached financial statements forissue onthis day. statements to be misleading orinaccurate. At thetime ofsigning, we are not aware ofany circumstance which would render any particulars included in the financial 30 June 2018. fairly thefinancial transactions during the year ended 30 June 2018 and financial position of Eastern Health as at Statement ofChanges inEquity, Cash Flow Statement and notes to and forming part ofthe financial statements, presents We further state that, in our opinion, the information set out in theComprehensive Operating Statement, Balance Sheet, Directions The attached financial statements for Eastern Health have been prepared in accordance with Part4.2ofthe Standing Officer’s andChief Finance& Board Member’s, Accountable reporting requirements. Directions, Australian Accounting Standards, Australian Accounting Interpretations and other mandatory professional Accounting Officer’s Declaration

August

Joanna

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Eastern Chief David Adjunct

Executive Financial Management Act 1994 Act Management Financial

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53 Eastern Health 2017-2018 Annual Report Financial Statements Financial Statements

54 Notes to and forming part of the Financial Statements 30 June 2018 Notes to and forming part ofthe Financial Statements 30 June 2018 55 Eastern Health 2017-2018 Annual Report Eastern Health Comprehensive Operating Statement for the year ended 30 June 2018

2018 2017 NOTE $’000 $’000 Revenue from Operating Activities 2.1 1,012,276 958,134 Revenue from Non-Operating Activities 2.1 2,526 2,263 1,014,802 960,397 Employee Expenses 3.1 (742,218) (700,463) Non Salary Labour Costs 3.1 (4,866) (6,084) Supplies & Consumables 3.1 (163,548) (167,875) Finance Costs 3.3 (773) (819) Other Expenses From Continuing Operations 3.1 (103,207) (93,595) (1,014,612) (968,836) NET RESULT BEFORE CAPITAL & SPECIFIC ITEMS 190 (8,439) Capital Purpose Income 2.1 55,599 48,382 Gain/(loss) on Disposal of Non-Current Assets 7.2 36 (349) Depreciation & Amortisation 4.3 (69,042) (69,362) NET RESULT AFTER CAPITAL & SPECIFIC ITEMS (13,217) (29,768) Other Economic Flows included in net result Revaluation of Long Service Leave 3.4 16 1,246 NET RESULT FOR THE YEAR (13,201) (28,522) OTHER COMPREHENSIVE INCOME Items that will not be reclassified to net result Changes in asset revaluation surplus/(loss) 8.1 61,008 1,429 TOTAL COMPREHENSIVE RESULT FOR THE YEAR 47,807 (27,093)

This Statement should be read in conjunction with the accompanying notes. Financial Statements Financial

56 as at 30June2018 Balance sheet Eastern Health This Statement should be read in conjunction with the accompanying notes. accompanying the with conjunction in read be should Statement This Receivables Cash and Cash Equivalents Current Assets Assets Leasehold Improvements Furniture &Fittings Plant, Equipment & Motor Vehicles Buildings Land Receivables Non-Current Assets TOTAL CURRENTASSETS Prepayments Inventories Investments and Other Financial Assets Borrowings Payables Current Liabilities Liabilities TOTAL ASSETS TOTAL NON-CURRENTASSETS Intangible Assets Contingent Assets &Contingent Liabilities Commitments TOTAL EQUITY Accumulated Surpluses/(Deficits) Contributed Capital Restricted Specific Purpose Surplus Asset Revaluation Surplus Equity NET ASSETS TOTAL LIABILITIES TOTAL NON-CURRENTLIABILITIES Provisions Borrowings Non-Current Liabilities TOTAL CURRENTLIABILITIES Other Current Liabilities Provisions

NOTE 5.1 6.3 4.2 4.2 4.2 4.2 4.2 5.1 5.4 5.2 4.1 6.1 5.5 4.4 7.3 6.4 8.1 8.1 8.1 8.1 3.4 6.1 5.3 3.4

1,033,253 259,310 949,938 724,703 724,703 308,550 718,382 108,989 167,241 247,762 278,077 181,716 83,315 49,240 26,914 41,017 47,189 42,663 62,445 22,205 31,623 30,576 18,664 13,282 $’000 2,118 8,392 2,307 4,870 8,207 1,867 2018

907,840 950,222 676,680 676,680 273,542 230,354 680,460 108,989 181,512 247,546 217,069 158,571 42,382 43,188 24,568 56,314 41,947 63,318 10,707 30,553 29,009 14,179 $’000 4,542 9,268 1,825 4,701 6,746 7,807 2017 155 658

57 Eastern Health 2017-2018 Annual Report Eastern Health Statement of Changes in Equity for the year ended 30 June 2018

Other Equity at Comprehensive Comprehensive Equity at 1 July 2017 Result Result 30 June 2018 2018 Note $’000 $’000 $’000 $’000

Accumulated Surplus/ 8.1 181,512 (13,201) - 168,311 (Deficit) Transfer (To)/ From Restricted - (1,070) - (1,070) Specific Purpose Reserve 181,512 (14,271) - 167,241 Contribution by Owners 8.1 247,546 216 247,762 247,546 216 - 247,762 Reserves Asset Revaluation Reserve 8.1 217,069 - 61,008 278,077 Restricted Specific Purpose 8.1 30,553 1,070 - 31,623 Reserve 247,622 1,070 61,008 309,700 TOTAL EQUITY AT THE END 676,680 (12,985) 61,008 724,703 OF THE FINANCIAL YEAR

Other Equity at Comprehensive Comprehensive Equity at 1 July 2016 Result Result 30 June 2017 2017 Note $’000 $’000 $’000 $’000

Accumulated Surplus/ 8.1 212,667 (28,522) - 184,145 (Deficit) Transfer (To)/ From Restricted - (2,633) - (2,633) Specific Purpose Reserve 212,667 (31,155) - 181,512 Contribution by Owners 8.1 236,964 10,582 - 247,546 236,964 10,582 - 247,546 Reserves Asset Revaluation Reserve 8.1 215,640 - 1,429 217,069 Restricted Specific Purpose 8.1 27,920 2,633 - 30,553 Reserve 243,560 2,633 1,429 247,622 TOTAL EQUITY AT THE END 693,191 (17,940) 1,429 676,680 OF THE FINANCIAL YEAR

This Statement should be read in conjunction with the accompanying notes. Financial Statements Financial

58 This Statement should be read in conjunction with the accompanying notes. accompanying the with conjunction in read be should Statement This for theyear ended30June2018 Cash Flow Statement Eastern Health Contributed Capital from Government Cash flows from financingactivities Non-cash financing and investing activities NET CASHOUTFLOW FROM INVESTING ACTIVITIES Proceeds from Sale of Properties, Plant & Equipment Purchase ofProperties, Plant & Equipment Cash flows from investing activities CASH ANDEQUIVALENTS AT 30JUNE2018 Other Payments CASH ANDEQUIVALENTS AT 1JULY 2017 NET INCREASE/(DECREASE) INCASHHELD NET CASHINFLOW FROM OPERATING ACTIVITIES TOTAL PAYMENTS Finance Costs NET CASHOUTFLOW FROM FINANCINGACTIVITIES Loan from Department ofHealth and Human Services Payments for Supplies &Consumables Fee for Medical Service Officers Interest Received GST Received from ATO Recoupment from Private Practice for use ofHospital Facilities Patient and Resident Fees Received Capital Grants from Government Operating Grants from Government Repayment ofLoanfrom Treasury Corporation ofVictoria Cash flows from operating activities Employee Benefits Paid TOTAL RECEIPTS Other Receipts

NOTE 6.3 8.2 6.2

(1,022,304) 1,100,305 (103,285) (196,578) (719,505) (48,084) (48,355) 896,461 (2,163) 41,017 78,001 36,475 26,296 28,463 48,725 54,303 44,405 $’000 4,542 6,558 7,000 1,652 (773) (658) 2018 271 216

1,023,891 (975,835) (196,863) (682,986) (48,088) (48,611) (92,513) 831,464 (2,654) 48,056 26,268 25,247 50,686 43,091 46,505 $’000 4,542 2,691 1,883 1,851 2,500 (819) (617) 2017 523 630 -

59 Eastern Health 2017-2018 Annual Report Basis of presentation

These financial statements are Judgements, estimates and presented in Australian dollars assumptions are required to be made and the historical cost convention about financial information being is used unless a different presented. The significant judgements measurement basis is specifically made in the preparation of these disclosed in the note associated financial statements are disclosed in the notes where amounts affected with the item measured on a by those judgements are disclosed. different basis. Estimates and associated assumptions The accrual basis of accounting has are based on professional judgements been applied in the preparation of derived from historical experience these financial statements whereby and various other factors that are assets, liabilities, equity, income believed to be reasonable under the and expenses are recognised in the circumstances. Actual results may reporting period to which they relate, differ from these estimates. regardless of when cash is received or paid. Revisions to accounting estimates are recognised in the period in which the Consistent with the requirements estimate is revised and also future of AASB 1004 Contributions (that is periods that are affected by the contributed capital and its repayment) revision. Judgements and assumptions are treated as equity transactions and, made by management in applying therefore, do not form part of the the application of AASB that have income and expenses of the hospital. significant effect on the financial Additions to net assets which have statements and estimates are disclosed been designated as contributions by in the notes under the heading: owners are recognised as contributed 'Significant judgement or estimates'. capital. Other transfers that are in the nature of contributions to or distributions by owners have also been designated as contributions by owners. Financial Statements Financial Statements

60 Notes to and forming part of the Financial Statements 30 June 2018 Note 1: Summary of significant accounting policies

These annual financial statements (B) REPORTING ENTITY The going concern basis was used to represent the audited general prepare the financial statements(refer The financial statements include all the purpose financial statements to Note 8.10 Economic Dependency). controlled activities of Eastern Health. for Eastern Health for the As a result of the financial performance period ending 30 June 2018. The principal address is: and position, Eastern Health has The report provides users with 5 Arnold Street obtained a letter of support from the information about the Health Box Hill State Government and in particular, Services’ stewardship of resources Victoria 3128 the Department of Health and Human entrusted to it. Services (DHHS), confirming that A description of the nature of Eastern DHHS will continue to provide Eastern Health’s operations and its principal Health adequate cash flow to meet (A) STATEMENT OF activities is included in the report of its current and future obligations COMPLIANCE operations, which does not form part up to 30 September 2019. (A letter of these financial statements. was obtained for the previous year). These financial statements are general On that basis, the financial statements purpose financial reports which have been prepared in accordance with Objectives and funding have been prepared on a going the Financial Management Act 1994 Eastern Health’s overall objective is concern basis. and applicable Australian Accounting to provide positive health experiences These financial statements are Standards (AASs), which include for people and communities in presented in Australian dollars, the interpretations issued by the Australian Melbourne’s east as well as improve functional and presentation currency Accounting Standards Board (AASB). the quality of life for Victorians. of the health service. They are presented in a manner Eastern Health is predominantly consistent with the requirements of All amounts shown in the financial funded by accrual based grant funding AASB 101 Presentation of Financial statements have been rounded to for the provision of outputs. Statements. the nearest thousand dollars, unless otherwise stated. Minor discrepancies The financial statements also comply Manner of Establishment in tables between totals and sum of with relevant Financial Reporting Eastern Health was established under components are due to rounding. Directions (FRDs) issued by the section 181 of the Victorian Health Eastern Health operates on a fund Department of Treasury and Finance, Services Act 1988 as a body corporate. and relevant Standing Directions (SDs) accounting basis and maintains three authorised by the Minister for Finance. funds: Operating, Specific Purpose and Capital Funds. Eastern Health Service's The Health Service is a not-for-profit (C) BASIS OF Capital and Specific Purpose Funds entity and therefore applies the ACCOUNTING include unspent donations and receipts additional Aus paragraphs applicable PREPARATION AND from DHHS capital, information to “not-for-profit” Health Services MEASUREMENT technology projects plus fund-raising under the AAS’s. Accounting policies are selected and activities conducted solely in respect The annual financial statements were applied in a manner which ensures of these funds. authorised for issue by the Board of that the resulting financial information The financial statements, except for Eastern Health on 09 August 2018. satisfies the concepts of relevance cash flow information, have been and reliability, thereby ensuring that prepared using the accrual basis the substance of the underlying of accounting. Under the accrual transactions or other events is basis, items are recognised as assets, reported. liabilities, equity, income or expenses The accounting policies set out below when they satisfy the definitions and have been applied in preparing the recognition criteria for those items, financial statements for the year ended that is they are recognised in the 30 June 2018, and the comparative reporting period to which they relate, information presented in these regardless of when cash is received financial statements for the year or paid. ended 30 June 2017. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 61 Note 1: Summary of significant accounting policies

Judgements, estimates and Goods and Services tax (GST) assumptions are required to be made Income, expenses and assets are about the carrying values of assets and recognised net of the amount of liabilities that are not readily apparent associated GST, unless the GST from other sources. The estimates incurred is not recoverable from and associated assumptions are based the Australian Taxation Office (ATO). on professional judgements derived In this case the GST payable is from historical experience and various recognised as part of the cost of other factors that are believed to be acquisition of the asset or as part reasonable under the circumstances. of the expense. Actual results may differ from these estimates. Receivables and payables are stated inclusive of the amount of GST The estimates and underlying receivable or payable. The net assumptions are reviewed on an amount of GST recoverable from, ongoing basis. or payable to, the ATO is included Revisions to accounting estimates with other receivables or payables are recognised in the period in which in the Balance Sheet. the estimate is revised and also in Cash flows are presented on a future periods that are affected gross basis. The GST components by the revision. Judgements and of cash flows arising from investing assumptions made by management or financing activities which are in the application of AASs that have recoverable from, or payable to significant effects on the financial the ATO, are presented as operating statements and estimates, with cash flow. a risk of material adjustments in the subsequent reporting period, Commitments and contingent assets relate to: and liabilities are presented on a gross basis. the fair value of land, buildings, infrastructure, plant and equipment, (refer to Note 4.2 Property, plant and equipment).

Actuarial assumptions for employee benefit provisions based on likely tenure of existing staff, patterns of leave claims, future salary movements and future discount rates (refer to Note 3.4 Employee Benefits).

Superannuation expense (refer to Note 3.5 Superannuation). Financial Statements Financial Statements

62 Notes to and forming part of the Financial Statements 30 June 2018 Note 2: Funding delivery of our services

The Health Service's overall objective is to deliver programs and services that support and enhance the wellbeing of all Victorians. To enable the Health Service to fulfil its objective it receives income based on parliamentary appropriations. The Health Service also receives income from the supply of services. Structure 2.1: Analysis of revenue by source

Note 2.1: Analysis of revenue by source

RAC including Admitted Non - Mental mental Aged Primary patients admitted EDS health health care health Other Total 2018 2018 2018 2018 2018 2018 2018 2018 2018 Note $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Government Grants 684,537 - 58,061 107,284 3,385 10,361 8,710 14,863 887,201 Indirect Contributions by Department of Health and Human Services** Insurance 546 ------546 Long Service Leave 7,216 ------7,216 Patient and Resident 38,152 1,448 - 1,493 7,658 16 53 - 48,820 Fees Recoupment from Private Practice for use 21,292 5,267 - - - - 1,284 197 28,040 of Hospital Facilities Other Revenue from 4,765 27 - 2,129 - 37 342 33,153 40,453 Operating Activities TOTAL REVENUE FROM OPERATING 756,508 6,742 58,061 110,906 11,043 10,414 10,389 48,213 1,012,276 ACTIVITIES Investment Income - - - - - 193 - - 1,181 1,374 Interest Property Income ------1,152 1,152 TOTAL REVENUE FROM NON-OPERATING - - - - 193 - - 2,333 2,526 ACTIVITIES Capital Purpose Income ------55,635 55,635 TOTAL CAPITAL ------55,635 55,635 PURPOSE INCOME TOTAL REVENUE 756,508 6,742 58,061 110,906 11,236 10,414 10,389 106,181 1,070,437

** Department of Health and Human Services makes certain payments on behalf of Eastern Health. These amounts have been brought to account in determining the operating result for the year by recording them as revenue and expenses. RAC = Residential Aged Care Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern EDS = Emergency Department Services Notes to and forming part of the Financial Statements 30 June 2018 63 Note 2: Funding delivery of our services

Note 2.1: Analysis of revenue by source (continued)

RAC including Admitted Non - Mental mental Aged Primary patients admitted EDS health health care health Other Total 2017 2017 2017 2017 2017 2017 2017 2017 2017 Note $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Government Grants 646,993 - 57,370 98,201 3,433 9,575 8,560 12,741 836,873 Indirect Contributions by Department of Health and Human Services** Insurance 556 ------556 Long Service Leave 8,949 ------8,949 Patient and Resident 37,757 1,386 - 1,862 7,617 12 64 - 48,698 Fees Recoupment from Private Practice for use 19,997 4,316 - - - - 1,163 161 25,637 of Hospital Facilities Other Revenue from 4,451 95 - 275 - 75 199 32,326 37,421 Operating Activities TOTAL REVENUE FROM OPERATING 718,703 5,797 57,370 100,338 11,050 9,662 9,986 45,228 958,134 ACTIVITIES Investment Income - - - - - 143 - - 802 945 Interest Property Income ------1,318 1,318 TOTAL REVENUE FROM NON-OPERATING - - - - 143 - - 2,120 2,263 ACTIVITIES Capital Purpose Income ------48,033 48,033 TOTAL CAPITAL ------48,033 48,033 PURPOSE INCOME TOTAL REVENUE 718,703 5,797 57,370 100,338 11,193 9,662 9,986 95,381 1,008,430

** Department of Health and Human Services makes certain payments on behalf of Eastern Health. These amounts have been brought to account in determining the operating result for the year by recording them as revenue and expenses. RAC = Residential Aged Care EDS = Emergency Department Services Financial Statements Financial Statements

64 Notes to and forming part of the Financial Statements 30 June 2018 Note 2: Funding delivery of our services

Note 2.1: Analysis of revenue by source (continued)

Revenue Recognition Patient and Resident Fees Mental Health Services (Mental comprises all specialised mental Income is recognised in accordance Patient fees are recognised as revenue Health) health services providing a range of with AASB 118 Revenue and is at the time invoices are raised. inpatient, community based residential, recognised as to the extent that it is rehabilitation and ambulatory services probable that the economic benefits Private Practice Fees which treat and support people with will flow to Eastern Health and the Private Practice fees are recognised a mental illness and their families and income can be reliably measured as revenue at the time invoices carers. These services aim to identify at fair value. Unearned income at are raised. reporting date is reported as income mental illness early, and seek to reducE received in advance. its impact through providing timely Revenue from Commercial acute care services and appropriate Amounts disclosed as revenue, where Activities longer-term accommodation and applicable, net of returns, allowances Revenue from commercial activities support for those living with a mental and duties and taxes. such as car parks is recognised at the illness. time invoices are raised. Government Grants and Non Admitted Services comprises other transfers of income acute and subacute non admitted Donations and Other Bequests services, where services are delivered (other than contributions Donations and bequests are recognised in public hospital clinics and provide by owners) as revenue when received. If donations models of integrated community In accordance with AASB 1004 are for a special purpose, they may be care, which significantly reduces appropriated to a reserve, such as the Contributions, government grants the demand for hospital beds and specific restricted purpose reserve. and other transfers of income (other supports the transition from hospital than contributions by owners) are to home in a safe and timely manner. recognised as income when the health Interest Revenue service gains control of the underlying Interest revenue is recognised on a Emergency Department Services (EDS) assets irrespective of whether time proportionate basis that takes comprises all emergency department conditions are imposed on the Health into account the effective yield of the services. Service’s use of the contributions. financial asset, which allocates interest over the relevant period. Aged Care comprises a range of in Contributions are deferred as income home, specialist geriatric, residential in advance when the health service Sale of investments care and community based programs has a present obligation to repay The gain/ (loss) on the sale of and support services, such as Home them and the present obligation can investments is recognised when the and Community Care (HACC) that are be reliably measured. investment is realised. targeted to older people, people with a disability, and their carers. Indirect Contributions from Other Income the Department of Health and Primary, Community and Dental Other income includes non-property Human Services Health comprises a range of home rental, dividend, forgiveness of liabilities, based, community based, community Insurance is recognised as and bad debt reversals. and primary health and dental revenue following advice from services including health promotion the Department of Health and Category Groups Human Services. and counselling, physiotherapy, Eastern Health has used the speech therapy, podiatry and following category groups for Long Service Leave (LSL) – occupational therapy and a range reporting purposes for the current Revenue is recognised upon of dental health services. and previous financial years. finalisation of movements in LSL liability in line with the Admitted Patient Services arrangements set out in the (Admitted Patients) comprises all Metropolitan Health and Aged acute and subacute admitted patient Care Services Division Hospital services, where services are delivered Circular 04/2017. in public hospitals. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 65 Note 2: Funding delivery of our services

Note 2.1: Analysis of revenue by source (continued)

Residential Aged Care including Other Services not reported Mental Health (RAC incl. Mental elsewhere – (Other) comprises Health) referred to in the past as services not separately classified psychogeriatric residential services, above, including: Public health services comprises those Commonwealth- including Laboratory testing, blood licensed residential aged care services borne viruses / sexually transmitted in receipt of supplementary funding infections clinical services, Koori liaison from the department under the officers, immunisation and screening mental health program. services, drugs services including drug withdrawal, counselling and the needle It excludes all other residential and syringe program, Disability services services funded under the mental including aids and equipment and health program, such as mental flexible support packages to people with health-funded community care units a disability, Community Care programs (CCUs) and secure extended care including sexual assault support, units (SECs). early parenting services, parenting assessment and skills development, and various support services. Health and Community Initiatives also falls in this category group. Financial Statements Financial Statements

66 Notes to and forming part of the Financial Statements 30 June 2018 Note 3: The cost of delivering our services

This section provides an account of the expenses incurred by the Health Service in delivering services and outputs. In Section 2, the funds that enable the provision of services were disclosed and in this note the cost associated with provision of services are recorded. Structure 3.1: Analysis of expenses by source 3.2: Analysis of expense and revenue by internally managed and restricted specific purpose funds 3.3: Finance costs 3.4: Provisions – Employee Benefits 3.5: Superannuation

Note 3.1: Analysis of expenses by source

RAC including Admitted Non - Mental Mental Aged Primary patients admitted EDS health health care health Other Total 2018 2018 2018 2018 2018 2018 2018 2018 2018 Note $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Services Supported by Health Services Agreement Employee Expenses 520,992 11,234 76,055 85,326 9,548 5,747 6,352 26,964 742,218 Non Salary Labour 3,656 - 43 456 16 - 582 113 4,866 Costs Supplies & 155,520 548 2,967 3,173 396 (5) 50 899 163,548 Consumables Other Expenses 62,345 720 3,550 22,004 1,173 1,366 2,382 9,255 102,795 Audit Fees Auditor-General 8.7 123 ------123 Other 274 - - - 2 - 1 12 289 TOTAL EXPENSES FROM OPERATING 742,910 12,502 82,615 110,959 11,135 7,108 9,367 37,243 1,013,839 ACTIVITIES Depreciation & 4.3 ------69,042 69,042 Amortisation Revaluation of Long ------(16) (16) Service Leave Finance Costs 3.3 ------773 773

TOTAL OTHER ------69,799 69,799 EXPENSES TOTAL EXPENSES 742,910 12,502 82,615 110,959 11,135 7,108 9,367 107,042 1,083,638

RAC = Residential Aged Care EDS = Emergency Department Services Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 67 Note 3: The cost of delivering our services

Note 3.1: Analysis of expenses by source (continued)

RAC including Admitted Non - Mental Mental Aged Primary patients admitted EDS Health Health care health Other Total 2017 2017 2017 2017 2017 2017 2017 2017 2018 Note $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Services Supported by Health Services Agreement Employee Expenses 500,724 10,851 67,850 76,728 9,484 5,616 5,775 23,435 700,463 Non Salary Labour 4,372 - 100 664 63 - 606 279 6,084 Costs Supplies & 160,447 414 2,974 2,957 362 3 43 675 167,875 Consumables Other Expenses 57,471 817 3,456 20,126 1,083 1,238 2,382 6,664 93,237 Audit Fees Auditor-General 8.7 120 ------120 Other 223 - - - 2 - 1 12 238 TOTAL EXPENSES FROM OPERATING 723,357 12,082 74,380 100,475 10,994 6,857 8,807 31,065 968,017 ACTIVITIES Depreciation & 4.3 ------69,362 69,362 Amortisation Revaluation of Long ------(1,246) (1,246) Service Leave Finance Costs 3.3 ------819 819

TOTAL OTHER ------68,935 68,935 EXPENSES TOTAL EXPENSES 723,357 12,082 74,380 100,475 10,994 6,857 8,807 100,000 1,036,952

RAC = Residential Aged Care EDS = Emergency Department Services Financial Statements Financial Statements

68 Notes to and forming part of the Financial Statements 30 June 2018 Note 3: The cost of delivering our services

Note 3.1: Analysis of expenses by source (continued)

Expense Recognition Revaluation gains/(losses) of The difference in the respective carrying amounts is recognised as Expenses are recognised as they are non-financial physical assets an expense in the comprehensive incurred and reported in the financial Refer to Note 4.2 Property plant operating statement. year to which they relate. and equipment. Services supported by health Employee expenses Amortisation of non-produced services agreement and Employee expenses include: intangible assets Intangible non-produced assets with services supported by hospital Salaries and Wages; finite lives are amortised as an ‘other and community initiatives economic flow’ on a systematic Annual leave; Activities classified aservices S basis over the assets’s useful life. Supported by Health Services Sick leave; Amortisation begins when the asset Agreement (HSA) are substantially is available for use that is when it is in funded by the Department of Health Work cover premium; the location and condition necessary and Human Services and includes Long service leave; and for it to be capable of operating in the Residential Aged Care Services (RACS) manner intended by management. and are also funded from other Superannuation expenses which sources such as the Commonwealth, are reported differently depending Revaluations of financial instrument patients and residents, whileServices upon whether employees are at fair value Supported by Hospital and Community members of defined benefit or Refer to Note 7.1 Financial Instruments. Initiatives (H&CI) are funded by the defined contribution plans. Health Service's own activities or local Other gains/(losses) from initiatives and/or the Commonwealth. Other operating expenses other economic flows Other operating expenses generally Other gains/ (losses) include: Residential aged care service represent the day-to-day running (RACS) the revaluation of the present costs incurred in normal operations The Mooroolbark, Northside and value of the long service leave and include: Edward Street Nursing Homes and liability due to changes in the Monda Lodge Hostel Residential Aged bond rate movements, inflation Supplies and consumables Care Service operations are an integral rate movements and the impact of Supplies and services costs are part of the Health service and share its changes in probability factors and; recognised as an expense in the resources. An apportionment of land reporting period in which they are transfer of amounts from the and buildings has been made based incurred. The carrying amounts of reserves to accumulated surplus on floor space. The results of the four any inventories held for distribution or net result due to disposal or operations have been segregated are expensed when distributed. derecognition or reclassification. based on actual revenue earned and expenditure incurred by each operation Bad & doubtful debts in Note 8.3 to the financial statements. Refer to Note 5.1 Receivables. Derecognition of financial liabilities The Mooroolbark, Northside and Other economic flows are A financial liability is derecognised Edward Street Nursing Homes and changes in the volume or value when the obligation under the liability Monda Lodge Hostel Residential Aged Care are substantially funded from of assets or liabilities that do is discharged cancelled or expires. Commonwealth bed-day subsidies. not result from transactions When an existing financial liability is replaced by another from the same Net gain/(loss) on non-financial assets lender on substantially different terms, Net gain/ (loss) on non-financial assets or the terms of an existing liability and liabilities includes realised and are substantially modified, such as an unrealised gains and losses as follows: exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 69 Note 3: The cost of delivering our services

Note 3.1: Analysis of expenses by source (continued)

Internally managed specific Restricted specific purpose funds purpose funds Internally managed specific purpose These funds are established for a funds are funds established, managed particular or specific purpose (that is, and controlled by the Board of a restriction or condition) through Management. The Board has control some forms of legal instrument such over every aspect of these funds as a trust or legal undertaking to including the specific purposes for comply with the condition or purpose which these funds are established. for which the fund is established. Internally managed specific funds The common types would be donation include fund-raising activities, provided to purchase a specified commercial ventures (e.g. Car Parks), equipment and research grant departmental fund and specific provided for particular field of interest. projects. A separate board or a separate committee normally manages the fund such as a foundation managed by a separate board. Alternatively, this could be managed by a management auxiliary to the Health Service’s Board.

The Health Service’s Board has no effective control on the restricted purpose fund other than to comply with or to implement the purpose for which the fund is set up. Financial Statements Financial Statements

70 Notes to and forming part of the Financial Statements 30 June 2018 Note 3: The cost of delivering our services

Note 3.2: Analysis of expense & revenue by internally managed and restricted specific purpose funds for services supported by hospital and community initiatives

Expenses Revenue

2018 2017 2018 2017 $’000 $’000 $’000 $’000

Private Practice and Other Patient Activities 2,223 2,228 3,921 4,140 Car Park 1,909 1,739 6,531 5,970 Education & Training 2,317 1,757 1,329 1,524 Catering 338 471 427 532 Other 3,175 3,232 1,939 2,050 Equipment Funds Transfer - - 2,965 3,565 Commissions 851 804 3,948 3,528 Interest - - 1,370 946 Property Income 610 809 1,745 1,884 Other Activities Fundraising and Community Support 1,046 705 2,240 2,117 Research and Scholarship 1,532 925 1,772 1,789 TOTAL 14,001 12,670 28,187 28,045

Note 3.3: Finance costs

2018 2017 $’000 $’000 Interest on Long Term Borrowings 773 819 TOTAL 773 819

Finance costs are recognised as expenses in the period in which they are incurred.

Finance costs include:

interest on bank overdrafts and short-term and long-term borrowings (Interest expense is recognised in the period in which it is incurred);

amortisation of discounts or premiums relating to borrowings;

amortisation of ancillary costs incurred in connection with the arrangement of borrowings; and

finance charges in respect of finance leases recognised in accordance with AASB 117 Leases. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 71 Note 3: The cost of delivering our services

Note 3.4: Employee benefits in the balance sheet

2018 2017 $’000 $’000 Current provisions Employee Benefits (Note 3.4(a)) Annual leave (Note 3.4(a)) Unconditional and Expected to be settled within 12 months 39,632 37,269 Unconditional and Expected to be settled after 12 months 6,663 6,148 Long service leave (Note 3.4(a)) Unconditional and Expected to be settled within 12 months 12,493 10,479 Unconditional and Expected to be settled after 12 months 78,240 70,522 SUB-TOTAL 137,028 124,418 Accrued Salaries and Accrued Days Off Unconditional and Expected to be settled within 12 months 30,309 21,012 Provisions related to employee benefit on-costs Unconditional and Expected to be settled within 12 months 5,390 5,023 Unconditional and Expected to be settled after 12 months 8,989 8,118 14,379 13,141 TOTAL CURRENT PROVISIONS 181,716 158,571 NON CURRENT PROVISIONS Employee Benefits (i) (Note 3.4(a)) 27,650 26,230 Provisions related to employee benefit on-costs 2,926 2,779 TOTAL NON-CURRENT PROVISIONS 30,576 29,009 TOTAL PROVISIONS 212,292 187,580 (a) Current employee benefits and related on-costs Unconditional Long Service Leave Entitlements 90,733 81,001 Annual Leave Entitlements 46,295 43,417 Accrued Salaries and Wages 29,368 19,904 Accrued Days Off 941 1,108 Current On-Costs 14,379 13,141 NON CURRENT EMPLOYEE BENEFITS AND RELATED ON-COSTS Conditional long service leave entitlements 27,650 26,230 Non-Current On-Costs 2,926 2,779 TOTAL EMPLOYEE BENEFITS AND RELATED ON-COSTS 212,292 187,580 (b) Movement in provisions Movement in Long Service Leave: Balance at start of year 118,592 105,631 Provision recognising employee service made during the year 22,966 23,854 Revaluations (16) (1,246) Settlement made during the year (10,714) (9,647) BALANCE AT THE END OF THE YEAR 130,828 118,592

NOTES: (i) Provisions for employee benefits consist of amounts for annual leave and long service leave accrued by employees, not including on-costs such as workers compensation Financial Statements Financial Statements

72 Notes to and forming part of the Financial Statements 30 June 2018 Note 3: The cost of delivering our services

Note 3.4: Employee benefits in the balance sheet(continued)

Provisions Undiscounted value – if the health This non-current LSL liability is service expects to wholly settle measured at present value. Provisions are recognised when within12 months; or the Health Service has a present Consideration is given to expected obligation, the future sacrifice of Present value – if the health service future wage and salary levels, economic benefits is probable, and does not expect to wholly settle experience of employee departures the amount of the provision can be within 12 months. and periods of service. Expected future measured reliably. payments are discounted using interest In relation to negotiated but unsigned rates of Commonwealth Government The amount recognised as a liability is Enterprise Bargaining Agreements guaranteed securities in Australia. the best estimate of the consideration (EBAs) with craft groups at year end, required to settle the present the Health Service recognises any Any gain or loss following revaluation obligation at reporting date, taking into entitlements to employees relating of the present value of non-current LSL account the risks and uncertainties to the EBA applicable prior to the liability is recognised as a transaction, surrounding the obligation. Where a reporting period based on the fact that except to the extent that a gain or loss provision is measured using the cash the employees have rendered services arises due to changes in estimations, flows estimated to settle the present to the Health Service and are expected e.g. bond rate movements and changes obligation, its carrying amount is the to be paid in exchange for that service. in probability factors, which are then present value of those cash flows, recognised as an other economic flow. using a discount rate that reflects the Long service leave (LSL) time value of money and risks specific The liability for LSL is recognised in the Termination benefits to the provision. provision for employee benefits. Termination benefits are payable when When some or all of the economic employment is terminated before Unconditional LSL (representing 10 benefits required to settle a provision the normal retirement date or when or more years of continuous service) are expected to be received from a an employee decides to accept an is disclosed in notes to the financial third party, the receivable is recognised offer of benefits in exchange for the statements as a current liability even as an asset if it is virtually certain termination of employment. where the health service does not that recovery will be received and expect to settle the liability within The health service recognises the amount of the receivable can be 12 months because it will not have termination benefits when it is measured reliably. the unconditional right to defer demonstrably committed to either the settlement should an employee terminating the employment of Employee benefits take leave within 12 months. current employees according to a This provision arises for benefits An unconditional right arises after detailed formal plan without possibility accruing to employees in respect a qualifying period. of withdrawal or providing termination of wages and salaries, annual leave benefits as a result of an offer made The components of this current LSL and long service leave for services to encourage voluntary redundancy. liability are measured at: rendered to the reporting date. Benefits falling due more than 12 Undiscounted value – if the health months after the end of the reporting Wages and salaries, annual service expects to wholly settle period are discounted to present value. leave, and accrued days off within 12 months; or Liabilities for wages and salaries, On-Costs related to employee Present value – if the health service including non-monetary benefits, expense does not expect to wholly settle annual leave and accrued days off within 12 months. Provisions for on-costs such as workers are recognised in the provision for compensation and superannuation employee benefits as current liabilities, Conditional LSL (representing less are recognised together with the because the health service does not than 10 years of continuous service) provisions for employee benefits. have an unconditional right to defer is disclosed as a non-current liability. settlements of these liabilities. There is an unconditional right to defer the settlement of the entitlement Depending on the expectation of the until the employee has completed timing of the settlement, liabilities for the requisite years of service. wages and salaries, annual leave and accrued days off are measured at: Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 73 Note 3: The cost of delivering our services

Note 3.5: Superannuation

Paid contribution Contribution outstanding for the year at year end 2018 2017 2018 2017 $’000 $’000 $’000 $’000 Defined benefit plans: (i) First State Superannuation Fund 627 687 16 15 Defined contribution plans: First State Superannuation Fund 33,913 34,252 784 706 HESTA Superannuation Fund 18,471 17,005 545 456 TOTAL 53,011 51,944 1,345 1,177

(i) The basis for determining the level of contributions is determined by the various actuaries of the defined benefit superannuation plans.

Employees of Eastern Health are Superannuation contributions are entitled to receive superannuation made to the plans based on the benefits and the health service relevant rules of each plan, and are contributes to both the defined based upon actuarial advice. benefit and defined contribution The Health Service does not recognise plans. The defined benefit plan any defined benefit liability in respect provides benefits based on years of the plan(s) because the entity has of service and final average salary. no legal or constructive obligation to pay future benefits relating to its Defined contribution employees; its only obligation is to superannuation plans pay superannuation contributions In relation to defined contribution as they fall due. The Department (i.e. accumulation) superannuation of Treasury & Finance discloses the plans, the associated expense is State’s defined benefits liabilities in simply the employer contributions its disclosure for administered items. that are paid or payable in respect of employees who are members of these However superannuation plans during the reporting period. contributions paid or payable for Contributions to defined contribution the reporting period are included superannuation plans are expensed as part of employee benefits in the when incurred. comprehensive operating statement of the Health Service.

Defined benefit The name, details and amounts of superannuation plans the expense in relation to the major The amount charged to the employee superannuation funds and comprehensive operating statement contributions made by the Health in respect of defined benefit Services are disclosed above. superannuation plans represents the contributions made by the Health Service to the superannuation plans in respect of the services of current Health Service staff during the reporting period. Financial Statements Financial Statements

74 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

The Health Service controls infrastructure and other investments that are utilised in fulfilling its objectives and conducting its activities. They represent the key resources that have been entrusted to the Health Service to be utilised for delivery of those outputs. Structure 4.1: Investments and other financial assets 4.2: Property, plant & equipment 4.3: Depreciation and amortisation 4.4: Intangible assets

Note 4.1: Investments and other financial assets

Specific Specific purpose fund purpose fund Total Total 2018 2017 2018 2017 Note $’000 $’000 $’000 $’000

Current Loans and receivables Australian Dollar Term 8,207 6,746 8,207 6,746 Deposits >= 3 months TOTAL 8,207 6,746 8,207 6,746 Represented by: Monies Held in Trust Accommodation Bonds (Refundable 8,207 6,746 8,207 6,746 Entrance Fees) TOTAL 8,207 6,746 8,207 6,746

Investments and other Investments are classified as assets is impaired. All financial financial assets held-to-maturity. instrument assets are subject to annual review for impairment. Hospital investments must be in Eastern Health classifies its financial accordance with Standing Direction assets between current and The allowance is the difference 3.7.2 – Treasury and Investment non-current assets based on the between the financial asset’s Risk Management. Investments are purpose for which the assets were carrying amount and the present recognised and derecognised on acquired. Management determines value of estimated future cash flows, trade date where purchase or sale the classification of its other financial discounted at the effective interest of an investment is under a contract assets at initial recognition. rate. In assessing impairment of whose terms require delivery of the statutory (non-contractual) financial investment within the timeframe Impairment of financial assets assets, which are not financial established by the market concerned, instruments, professional judgement At the end of each reporting period, and are initially measured at fair value, is applied in assessing materiality the Health Service assesses whether net of transaction costs. using estimates, averages and other there is objective evidence that a computational methods in accordance financial asset or group of financial with AASB 136 Impairment of Assets. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 75 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (a) Gross carrying amount and accummulated depreciation

2018 2017 $’000 $’000 Land Land at Fair Value 108,989 108,989 Less Impairment - - TOTAL LAND 108,989 108,989 Buildings Buildings at Cost 13,711 419,070 Less Accumulated Depreciation (236) (42,684) 13,475 376,386 Buildings Under Construction at cost 30,466 25,594 Buildings at Fair Value 674,441 351,678 Less Accumulated Depreciation - (73,198) 674,441 278,480 TOTAL BUILDINGS 718,382 680,460 Leasehold Improvements Leasehold Improvements 7,573 5,348 Less Accumulated Depreciation (5,455) (5,193) TOTAL LEASEHOLD IMPROVEMENTS 2,118 155 Plant and Equipment Medical Equipment at Fair Value 111,927 109,674 Less Accumulated Depreciation (75,730) (67,186) 36,197 42,488 Computers and Communication at Fair Value 49,717 47,063 Less Accumulated Depreciation (42,500) (36,822) 7,217 10,241 Assets Under Construction 2,659 1,835 TOTAL PLANT AND EQUIPMENT 46,073 54,564 Motor Vehicles Motor Vehicles at Fair Value 6,350 6,649 Less Accumulated Depreciation (5,234) (4,899) TOTAL MOTOR VEHICLES 1,116 1,750 TOTAL PLANT, EQUIPMENT AND MOTOR VEHICLES 47,189 56,314 Furniture and Fittings Furniture and Fittings at Fair Value 27,073 25,782 Less Accumulated Depreciation (18,681) (16,514) TOTAL FURNITURE AND FITTINGS 8,392 9,268 TOTAL 885,070 855,186 Financial Statements Financial Statements

76 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (b) Reconciliation of the carrying amounts of each class at the beginning of the previous and current financial year is set out below.

Buildings & Building leasehold capital work Plant & Furniture & Motor Land improvements in progress equipment fittings vehicles Total $’000 $’000 $’000 $’000 $’000 $’000 $’000

BALANCE AS AT 97,343 674,323 22,216 59,951 10,749 2,278 866,860 1 JULY 2016 Additions - 3,744 38,988 6,693 522 566 50,513 Assets transferred as Capital 10,217 364 - - - - 10,581 Contributions Net transfers - 18,203 (35,610) 5,010 267 - (12,130) between classes Disposals - (161) - (406) - (305) (872) Depreciation - (41,452) - (16,684) (2,270) (789) (61,195) (note 4.3) Revaluation increments/ 1,429 - - - - - 1,429 (decrements) BALANCE AS AT 108,989 655,021 25,594 54,564 9,268 1,750 855,186 1 JULY 2017 Additions - 4,008 38,831 2,930 892 128 46,789 Net transfers - 11,929 (33,959) 4,106 432 - (17,492) between classes Disposals - - - (33) (5) (196) (234) Depreciation - (41,932) - (15,494) (2,195) (566) (60,187) (note 4.3) Revaluation increments/ - 61,008 - - - - 61,008 decrements BALANCE AS AT 108,989 690,034 30,466 46,073 8,392 1,116 885,070 30 JUNE 2018 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 77 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued)

Buildings carried at valuation Land carried at Valuation This resulted in an overall 24% increase in Land valuation. Buildings have been revalued at Land has been revalued as at 30 June 2018 based on a managerial 30 June 2017 based on a managerial A full valuation of Land and Buildings valuation. This managerial valuation valuation using a change in type of using external valuers is planned in the is determined from the original land from commercial to englobo for forthcoming year. independent valuation at 30 June 2014 the main hospital sites. This managerial uplifted by the Valuer Generals land valuation is determined from the Plant and Equipment has been valued indices between 30th June 2014 and original independent valuation at at fair value in accordance with FRD 30th June 2018. This has resulted in 30 June 2014 uplifted by Valuer 103F. The fair value was determined an overall 10% increase in the building Generals land indices between by depreciated replacement valuation. 30th June 2014 and 30th June 2017.

(c) Fair value measurement hierarchy for assets as at 30 June 2018

Carrying Fair value measurement amount at end of reporting period using: as at 30 June 2018 Level 1 Level 2 Level 3 Land at fair value Non-specialised land 686 - 686 - Specialised land 108,303 - - 108,303 TOTAL OF LAND AT FAIR VALUE 108,989 - 686 108,303 Buildings at fair value Non-specialised buildings 25,045 - 25,045 - Specialised buildings 649,396 - - 649,396 TOTAL OF BUILDING AT FAIR VALUE 674,441 - 25,045 649,396 Plant and equipment at fair value Plant equipment and vehicles at fair value Vehicles 1,116 - - 1,116 Plant and equipment 43,414 - - 43,414 TOTAL OF PLANT, EQUIPMENT AND 44,530 - - 44,530 VEHICLES AT FAIR VALUE Furniture & Fittings at fair value 8,392 - - 8,392 TOTAL FURNITURE & FITTINGS AT FAIR VALUE 8,392 - - 8,392 836,352 - 25,731 810,621 Financial Statements Financial Statements

78 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (c) Fair value measurement hierarchy for assets as at 30 June 2017

Carrying Fair value measurement amount at end of reporting period using: as at 30 June 2017 Level 1 Level 2 Level 3

Land at fair value Non-specialised land 686 - 686 - Specialised land 108,303 - - 108,303 TOTAL OF LAND AT FAIR VALUE 108,989 - 686 108,303 Buildings at fair value Non-specialised buildings 22,864 - 22,864 - Specialised buildings 255,616 - - 255,616 TOTAL OF BUILDING AT FAIR VALUE 278,480 - 22,864 255,616 Plant and equipment at fair value Plant equipment and vehicles at fair value Vehicles (ii) 1,750 - - 1,750 Plant and equipment 52,729 - - 52,729 TOTAL OF PLANT, EQUIPMENT AND 54,479 - - 54,479 VEHICLES AT FAIR VALUE Furniture & Fittings at fair value 9,269 - - 9,269 TOTAL FURNITURE & FITTINGS AT FAIR VALUE 9,269 - - 9,269 451,217 - 23,550 427,667 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 79 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued)

Land at 12 Grey Street was valued A managerial valuation of buildings has The valuation was performed using by the independent valuer at been undertaken based on the original the market approach adjusted for CSO. market value without allowance for independent valuation as at 30 June The effective date of the valuation is Community Service Obligation (CSO) 2014 uplifted by Valuer-General's land 30 June 2014. adjustment at 30 June 2014. This land indices between 30 June 2014 and A managerial valuation of land has has been subsequently revalued as at 30 June 2018. been undertaken based on the original 30 June 2017 based on a managerial independent valuation as at 30 June valuation. Specialised land and 2014 uplifted by Valuer-General's land The building at 5 Arnold Street was Specialised buildings indices between 30 June 2014 and valued by the independent valuer at The market approach is also used 30 June 2018. market value at 30 June 2014 and not for specialised land and specialised at Depreciated Replacement Cost. buildings although it is adjusted for Vehicles This is the first time that this building community service obligations (CSO) The Health Service acquires new has been valued given that in to reflect the specialised nature of the vehicles and at times disposes of them 2009 (last independent valuation), assets being valued. Specialised assets before completion of their economic the building had only just been contain significant, unobservable life. The process of acquistion, use and commissioned. adjustments; therefore these assets disposal in the market is managed by are classified as level 3 under the the Health Service which sets relevant A managerial valuation of buildings market based direct comparison depreciation rates during use to reflect has been undertaken based on approach. the original independent valuation the consumption of the vehicle. As a as at 30 June 2014 uplifted by The CSO adjustment is a reflection of result, the fair value of vehicles does Valuer-General's land indices between the valuer's assessment of the impact not differ materially from the carrying 30 June 2014 and 30 June 2018. of restrictions associated with an value (depreciated cost). asset to the extent that is also equally Non-specialised land and applicable to market participants. Plant and Equipment non-specialised buildings This approach is in light of the highest Plant and equipment (including and best use consideration required Non-specialised land and medical equipment, computers for fair value measurement, and takes non-specialised buildings are valued and communication equipment into account the use of the asset that is using market approach. Under this and furniture and fittings) is held at physically possible, legally permissible valuation method, the assets are carrying value (depreciated cost). and financially feasible. As adjustments compared to recent comparable sales When plant and equipment is of CSO are considered as significant or sales of comparable assets which specialised in use, such that it is unobservable inputs, specialised land are considered to have a nominal or rarely sold other than as part of a going would be classified as Level 3 assets. no added improvement value. concern, the depreciated replacement For Health Services, the depreciated cost is used to estimate the fair value. For non-specialised land and replacement cost method is used non-specialised buildings an Unless there is market evidence that for the majority of specialised independent valuation was performed the current replacement costs are buildings, adjusting for the associated by Urbis Pty Ltd to determine the significantly different from the original depreciation. As depreciation fair value using the market approach. acquisition cost, it is considered adjustments are considered as Valuation of the assets was determined unlikely that depreciated replacement significant and unobservable in nature, by analysing comparable sales and cost will be materially different from specialised buildings are classified as allowing for share, size, topography, the carrying value. Level 3 for fair value measurement. location and other relevant factors There are no changes in valuation specific to the asset being valued. An independent valuation of the techniques throughout the period to An appropriate rate per square metre Health Service's specialised land and 30 June 2018. For all assets measured has been applied to the subject asset. buildings was performed by an agent at fair value, the current use is The effective date of the Valuation is to the Valuer-General Victoria being considered the highest and best use. 30 June 2014. Urbis Pty Ltd. Financial Statements Financial Statements

80 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (d) Reconciliation of Level 3 fair value as at 30 June 2018

Plant and Furniture & 30 June 2018 Land Buildings equipment fittings

Opening Balance 108,303 255,616 54,479 9,269 Purchases (sales) - - 6,111 1,318 Transfers in (out) of Level 3 - 359,657 - - Gains or losses recognised in net result Depreciation - (24,403) (16,060) (2,195) Impairment loss - - - - SUBTOTAL - 335,254 (9,949) (877) Items recognised in other comprehensive income Revaluation - 58,526 - - SUBTOTAL - 58,526 - - CLOSING BALANCE 108,303 649,396 44,530 8,392

Plant and Furniture & 30 June 2017 Land Buildings equipment fittings

Opening Balance 96,657 279,020 59,997 10,749 Purchases (sales) 10,217 46 11,955 790 Transfers in (out) of Level 3 - - - Gains or losses recognised in net result Depreciation - (23,450) (17,473) (2,270) Impairment loss - - - - SUBTOTAL 10,217 (23,404) (5,518) (1,480) Items recognised in other comprehensive income Revaluation 1,429 - - - SUBTOTAL 1,429 - - - CLOSING BALANCE 108,303 255,616 54,479 9,269 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 81 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (e) Description of significant unobservable inputs to Level 3 valuations

Sensitivity of fair value measurement Expected Significant Range to changes fair value Examples of Valuation unobservable (weighted in significant level types of assets technique inputs average) unobservable inputs In areas where there is an Non-specialised active market land vacant land Market 12 Grey Street Level 2 N/A N/A N/A land not approach East Ringwood subject to restrictions as to use or sale

Specialised land Land subject to All Land held restrictions A significant increase by Eastern Community as to use or decrease in the Health except Service and/or sale Market CSO adjustment for Maroondah Level 3 Obligation 20% approach would result in a Hospital Car Park Land in (CSO) significantly lower 12 Grey Street areas where adjustment (higher) fair value East Ringwood there is not an active market

Non Specialised For general/ Buildings commercial Market Level 2 N/A N/A N/A 5 Arnold Street buildings that approach Box Hill are just built

A significant increase or decrease in direct cost per square Specialised metre adjustment Direct cost buildings Specialised $500 – would result in a per square buildings $5,254/m2 significantly higher All Buildings metre with limited Depreciated ($1,679) or lower fair value held by Level 3 alternative replacement Useful Eastern Health 30 - 60 A significant uses and/or cost life of except for years increase or substantial specialised 5 Arnold Street (45 years) decrease in the customisation buildings Box Hill estimated useful life of the asset would result in a significantly higher or lower valuation Financial Statements Financial Statements

82 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (e) Description of significant unobservable inputs to Level 3 valuations (continued)

Sensitivity of fair value measurement Expected Significant Range to changes fair value Examples of Valuation unobservable (weighted in significant level types of assets technique inputs average) unobservable inputs A significant increase or decrease in cost per unit Specialised Plant and would result in a items with equipment at Cost per $1,000 - significantly higher limited fair value unit $1,610,175 or lower fair value alternative Depreciated ($1,810) All plant & Level 3 uses and/or replacement Useful life A significant equipment substantial cost of PPE 8-20 years increase or owned by customisation (11 years) decrease in the Eastern Health estimated useful life of the asset would result in a significantly higher or lower valuation

A significant increase or decrease in cost per unit would result in a $1,000- significantly higher Vehicles Cost per $55,837 If there is or lower fair value Depreciated unit per unit All vehicles no active Level 3 replacement ($4,466.57 A significant owned by resale market Useful life cost per unit) increase or Eastern Health available of vehicles decrease in the 5 years estimated useful life of the asset would result in a significantly higher or lower valuation

Increase (decrease) in gross replacement cost would result Furniture & Cost per in a significantly $1,000 - Fittings at fair If there is unit higher (lower) Depreciated $903,850 value no active fair value Level 3 replacement Useful ($2,680) All furniture and resale market life of Increase cost 3-10 years fittings owned by available Furniture (decrease) (6 Years) Eastern Health & fittings in useful life would result in a significantly higher (lower) fair value Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 83 Note 4: Key assets to support service delivery

Note 4.2: Property, plant & equipment (continued) (e) Description of significant unobservable inputs to Level 3 valuations (continued)

Property, plant and equipment Land and buildings are recognised Revaluation increments are recognised initially at cost and subsequently in ‘other comprehensive income’ All non-current physical assets measured at fair value less and are credited directly in equity to are measured initially at cost and accumulated depreciation and the asset revaluation surplus, except subsequently revalued at fair value accumulated impairment loss. that, to the extent that an increment less accumulated depreciation and reverses a revaluation decrement in accumulated impairment loss. Plant, equipment and vehicles respect of that same class of asset Where an asset is acquired for no are recognised initially at cost and previously recognised as an expense in or nominal cost, the cost is its fair subsequently measured at fair value net result, the increment is recognised value at the date of acquisition. less accumulated depreciation as income in the net result. Assets transferred as part of a and accumulated impairment loss. merger/machinery of government are Depreciated historical cost is generally Revaluation decrements are recognised transferred at their carrying amount. a reasonable proxy for fair value in ‘other comprehensive income’ to because of the short lives of the the extent that a credit balance exists More details about the valuation assets concerned. in the asset revaluation surplus in techniques and inputs used in respect of the same class of property, determining the fair value of plant and equipment. non-financial physical assets are Leasehold improvements discussed in Note 4.2 Property, The cost of a leasehold improvement is Revaluation increases and revaluation plant and equipment. capitalised as an asset and depreciated decreases relating to individual assets over the shorter of the remaining term within an asset class are offset against The initial cost for non-financial of the lease or the estimated useful one another within that class but physical assets under finance lease is life of the improvements. are not offset in respect of assets in measured at amounts equal to the fair different classes. value of the leased asset or, if lower, Revaluations of non-current the present value of the minimum Revaluation surplus is not normally physical assets lease payments, each determined at transferred to accumulated funds on the inception of the lease. Non-current physical assets are derecognition of the relevant asset. measured at fair value and are Crown land is measured at fair revalued in accordance with FRD In accordance with FRD 103F, Eastern value with regard to the property’s 103F Non-current physical assets. Health’s non-current physical assets highest and best use after due This revaluation process normally were assessed to determine whether consideration is made for any legal occurs at least every five years, based revaluation of the non-current physical or physical restrictions imposed on upon the asset’s Government Purpose assets was required. the asset, public announcements Classification, but may occur more or commitments made in relation frequently if fair value assessments to the intended use of the asset. indicate material changes in values. Theoretical opportunities that may be available in relation to the asset(s) Independent valuers are used to are not taken into account until it is conduct these scheduled revaluations virtually certain that any restrictions and any interim revaluations are will no longer apply. Therefore, unless determined in accordance with the otherwise disclosed, the current use requirements of the FRDs. Revaluation of these non-financial physical assets increments or decrements arise from will be their highest and best uses. differences between an asset’s carrying amount and fair value. Financial Statements Financial Statements

84 Notes to and forming part of the Financial Statements 30 June 2018 Note 4: Key assets to support service delivery

Note 4.3: Depreciation and amortisation

2018 2017 $’000 $’000 Depreciation Buildings 41,670 41,085 Plant & Equipmen Major Medical 9,523 9,814 Computers and Communications 5,971 6,870 Furniture and Fittings 2,195 2,270 Motor Vehicles 566 789 Leasehold Improvements 262 368 TOTAL DEPRECIATION 60,187 61,196 Amortisation Software 8,855 8,166 TOTAL AMORTISATION 8,855 8,166 TOTAL DEPRECIATION & AMORTISATION 69,042 69,362

All infrastructure assets, buildings, plant and equipment and other non-financial physical assets that have finite useful lives are depreciated. Depreciation begins when the asset is available for use, which is when it is in the location and condition necessary for it to be capable of operating in a manner intended by management. Depreciation is generally calculated on a straight line basis, at a rate that allocates the asset value, less any estimated residual value over its estimated useful life. Estimates of the remaining useful lives, residual value and depreciation method for all assets are reviewed at least annually, and adjustments made where appropriate. This depreciation charge is not funded by the Department of Health and Human Services. Assets with a cost in excess of $1,000 are capitalised and depreciation has been provided on depreciable assets so as to allocate their cost or valuation over their estimated useful lives. The following table indicates the expected useful lives of non-current assets on which the depreciation charges are based.

2017-18 2016-17 Buildings Structure Shell Building Fabric 11 - 46 years 11 - 46 years Site Engineering Services and Central Plant 11 - 46 years 11 - 46 years Central Plant Fit Out 3 - 21 years 3 - 21 years Trunk Reticulated Building Systems 3 - 21 years 3 - 21 years Plant & Equipment 10 - 20 years 10 - 20 years Medical Equipment 8 - 15 years 8 - 15 years Computers and Communications 3 - 10 years 3- 10 years Furniture & Fittings 10 years 10 years Motor Vehicles 5 years 5 years Intangible Assets 3 years 3 years Leasehold Improvements 5 years 5 years

As part of the buildings valuation, building values were separated into components and each component assessed for its useful life which is represented above. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 85 Note 4: Key assets to support service delivery

Note 4.4: Intangible assets

2018 2017 $’000 $’000

Intangibles Software 68,874 49,818 Less Accumulated Amortisation (46,669 (39,111) 22,205 10,707 TOTAL WRITTEN DOWN VALUE 22,205 10,707

Reconciliation of the carrying amounts of intangible assets at the beginning and end of the previous and current financial year:

Software Total $’000 $’000

BALANCE AS AT 1 JULY 2016 3,355 3,355 Additions 3,388 3,388 Net transfers between classes 12,130 12,130 Disposals - - Amortisation (note 4.3) (8,166) (8,166) BALANCE AS AT 1 JULY 2017 10,707 10,707 Additions 2,861 2,861 Net transfers between classes 17,492 17,492 Disposals - - Amortisation (note 4.3) (8,855) (8,855) BALANCE AS AT 30 JUNE 2018 22,205 22,205

Intangible assets represent identifiable computer software. Intangible assets are initially recognised at cost. Subsequently, intangible assets with finite useful lives are carried at cost less accumulated amortisation and accumulated impairment losses. Costs incurred subsequent to initial acquisition are capitalised when it is expected that additional future economic benefits will flow to the Health Service.

Amortisation Amortisation is allocated to intangible non-produced assets with finite useful lives on a straight-line basis over the asset’s useful life. Amortisation begins when the asset is available for use, that is, when it is in the location and condition necessary for it to be capable of operating in the manner intended by management.

The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each annual reporting period. In addition, an assessment is made at each reporting date to determine whether there are indicators that the intangible asset concerned is impaired. If so, the assets concerned are tested as to whether their carrying amount exceeds its recoverable amount. Financial Statements Financial Statements

86 Notes to and forming part of the Financial Statements 30 June 2018 Note 5: Other assets and liabilities

This section sets out those assets and liabilities that arose from the hospital’s operations. Structure 5.1: Receivables 5.2: Inventories 5.3: Other liabilities 5.4: Prepayments and other assets 5.5: Payables

Note 5.1: Receivables

Total Total 2018 2017 $’000 $’000

Current Contractual Trade Debtors 11,047 9,944 Patient Fees 12,000 11,905 Accrued Income 461 739 Less Allowance for Doubtful Debts Trade Debtors (978) (1,064) Patient Fees (2,074) (1,966) 20,456 19,558 Statutory GST Receivable 2,369 2,183 Accrued Revenue - Department of Health / Department of Health and Human Services 4,089 2,827 6,458 5,010 TOTAL CURRENT RECEIVABLES 26,914 24,568 Non current Statutory Long Service Leave - Department of Health / Department of Health and Human Services 42,663 41,947 TOTAL NON CURRENT RECEIVABLES 42,663 41,947 TOTAL RECEIVABLES 69,577 66,515 (a) Movement in the allowance for doubtful contractual receivables Balance at the beginning of the year 3,030 2,317 Amounts written off during the year - - Amounts recovered during the year - - Increase/(decrease) in allowance recognised in net result 22 713 BALANCE AT THE END OF THE YEAR 3,052 3,030 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 87 Note 5: Other assets and liabilities

Note 5.1: Receivables (continued)

Receivables consist of: but are not not classified as financial A provision for doubtful debts is instruments because they do not arise recognised when there is objective Statutory receivables, which includes from a contract. evidence that the debts may not be predominantly amounts owing from collected and bad debts are written the Victorian Government and GST Receivables are recognised initially at off when identified. input tax credits recoverable; and fair value and subsequently measured at amortised cost, using the effective Contractual receivables, which interest method, less any accumulated Doubtful debts includes mainly debtors in relation impairment. Receivables are assessed for bad and to goods and services. doubtful debts on a regular basis. Trade debtors are carried at nominal Receivables that are contractual are Those bad debts considered as written amounts due and are due for classified as financial instruments and off by mutual consent are classified settlement within 60 days from the categorised as loans and receivables. as a transaction expense. Bad debts date of recognition. Collectability of Statutory receivables are recognised not written off by mutual consent and debts is reviewed on an ongoing basis and measured similarly to contractual the allowance for doubtful debts are and debts which are known to be receivable (except for impairment), classified as other economic flows in uncollectible are written off. the net result.

Note 5.2: Inventories

2018 2017 $’000 $’000 Pharmaceuticals - at cost 2,607 2,835 Medical and Surgical Lines - at cost 1,157 878 Allied Health and Diagnostics - at cost 1,106 988 TOTAL INVENTORIES 4,870 4,701

Inventories include goods and other property held either for sale, consumption or for distribution at no or nominal cost in the ordinary course of business operations.

Inventories held for distribution are measured at cost, adjusted for any loss of service potential. All other inventories are measured at the lower of cost or net realisable value.

The bases used in assessing loss of service potential for inventories held for distribution include current replacement cost and technical or functional obsolescence. Technical obsolescence occurs when an item still functions for some or all of the tasks it was originally acquired to do, but no longer matches existing technologies. Functional obsolescence occurs when an item no longer functions the way it did when it was first acquired.

Cost for all other inventory is determined principally on the basis of the weighted average cost method. Financial Statements Financial Statements

88 Notes to and forming part of the Financial Statements 30 June 2018 Note 5: Other assets and liabilities

Note 5.3: Other liabilities

2018 2017 Note $’000 $’000

Current Income in Advance Other 5,034 1,020 Other Liabilities 41 41 5,075 1,061 Monies Held in Trust Accommodation Bonds (Refundable Entrance Fees) 8,207 6,746 TOTAL 13,282 7,807 Total Monies held in trust represented by the following assets: Other Financial Assets 4.1 8,207 6,746 TOTAL 8,207 6,746

Note 5.4: Prepayments and other non-financial assets

2018 2017 $’000 $’000

Current Prepayments Maintenance Contracts 1,602 1,218 Rental, Licences & Memberships 705 607 TOTAL PREPAYMENTS 2,307 1,825

Other non-financial assets include prepayments which represent payments in advance of receipt of goods or services or are that part of expenditure made in one accounting period covering a term extending beyond that period. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 89 Note 5: Other assets and liabilities

Note 5.5: Payables

2018 2017 $’000 $’000

Current Contractual Trade Creditors 26,645 29,491 Accrued Expenses 25,557 24,280 Superannuation 6,321 5,889 Work Cover - - 58,523 59,660 Statutory Department of Health and Human Services 60 53 PAYG Payable 3,862 3,605 3,922 3,658 TOTAL CURRENT 62,445 63,318

Payables consist of:

Contractual payables which consist predominantly of accounts payable representing liabilities for goods and services provided to the Health Service prior to the end of the financial year that are unpaid, and arise when the Health Service becomes obliged to make future payments in respect of the purchase of those goods and services. The normal credit terms for accounts payable are usually Net 45 days from the end of the month of invoice.

Statutory payables, such as goods and services tax and fringe benefits tax payables.

Contractual payables are classified as financial instruments and are initially recognised at fair value, and then subsequently carried at amortised cost. Statutory payables are recognised and measured similarly to contractual payables, but are not classified as financial instruments and not included in the category of financial liabilities at amortised cost, because they do not arise from a contract. Financial Statements Financial Statements

90 Notes to and forming part of the Financial Statements 30 June 2018 Note 6: How we finance our operations

This section provides information on the sources of finance utilised by the Health Service during its operations, along with interest expenses (the cost of borrowings) and other information related to financing activities of the Health Service. This section includes disclosures of balances that are financial instruments (such as borrowings and cash balances). Note: 7.1 provides additional, specific financial instrument disclosures. Structure 6.1: Borrowings 6.2: Non-cash financing and investing activities 6.3: Cash and cash equivalents 6.4: Commitments for expenditure

Note 6.1: Borrowings

2018 2017 $’000 $’000

Current Australian Dollar Borrowings - TCV Loan 701 658 Australian Dollar Borrowings - Department of Health and Human Services 1,166 - TOTAL AUSTRALIAN DOLLARS BORROWINGS 1,867 658 TOTAL CURRENT 1,867 658 Non current Australian Dollar Borrowings - TCV Loan 11,164 11,865 Australian Dollar Borrowings - Department of Health and Human Services 7,500 2,314 TOTAL AUSTRALIAN DOLLARS BORROWINGS 18,664 14,179 TOTAL NON-CURRENT 18,664 14,179 TOTAL BORROWINGS 20,531 14,837

The borrowings relate to five loans. A loan facility of $1.5 million from A loan facility of $11.25 million from Treasury Corporation of Victoria (TCV) Treasury Corporation of Victoria (TCV) A loan facility of $4.7 million from to finance the construction of the car to finance the construction of the car Treasury Corporation of Victoria (TCV) park facility at the Angliss Hospital. park facility at the Box Hill Hospital. to finance the construction of the car As at year end, $0.394 million As at year end $9.455 million park facility at Maroondah Hospital. (2016/17 $0.543 million) was still (2016/17 $9.752 million) was still As at year end, $2.016 million owed. The loan is repayable over owing. The loan is repayable over (2016/17 $2.227 million) was still 14 years. The repayments commenced 23 years. The repayments commenced owed. The loan is repayable over a month after final draw down being in 4 March 2011 after final drawdown. 20 years. The repayments commenced 28 June 2008. The interest rate The interest rate applicable is fixed at a month after final draw down being applicable is fixed at 7.23% pa for 6.435% pa for the life of the loan. 15 December 2005. The interest rate the life of the loan. applicable is fixed at 5.8628% pa for the life of the loan. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 91 Note 6: How we finance our operations

Note 6.1: Borrowings (continued)

A loan facility of $2.5 million from A loan facility of $7.0 million the Department of Health and ($2 million for a Single Billing system Human Services (DHHS), is for the and $5 million for working capital) implementation of a new Payroll from the Department of Health and rostering system, was received in Human Services (DHHS) was received June 2017. As at year end, a in June 2018. As at year end, a discounted amount of $2.363 million discounted amount of $6.303 million (2016/17 $2.314 million) is still owed. is still owed. The Loan is repayable The Loan is repayable over 6 years over 5 years with the first repayment with the first repayment commencing commencing July 2018 and is an July 2018 and is an interest free loan. interest free loan.

Note 6.2: Non-cash financing and investing activities

2018 2017 $’000 $’000 Acquisition of Assets by means of indirect contribution by Department of Health 1,296 5,291 & Human Services TOTAL NON-CASH FINANCING AND INVESTING ACTIVITIES 1,296 5,291

Note 6.3: Cash and cash equivalents

For the purpose of the Cash Flow Statement, cash assets include cash on hand, cash in banks and short term deposits which are readily convertible to cash on hand, and are subject to an insignificant risk of change in value, net of outstanding bank overdrafts.

2018 2017 $’000 $’000 Cash on Hand 40 36 Cash at Bank 39,831 3,990 Short Term Money Market 1,146 516 TOTAL CASH AND CASH EQUIVALENTS 41,017 4,542 Represented by: Cash for Health Service Operations (as per Cash Flow Statement) 41,017 4,542 TOTAL CASH AND CASH EQUIVALENTS 41,017 4,542

Cash and cash equivalents recognised on the balance sheet comprise cash on hand and at bank, deposits at call and highly liquid investments (with an original maturity of 3 months or less), which are held for the purpose of meeting short term cash commitments rather than for investment purposes, which are readily convertible to known amounts of cash with an insignificant risk of changes in value.

For cash flow statement presentation purposes, cash and cash equivalents includes bank overdrafts, which are included as current borrowings in the balance sheet. Financial Statements Financial Statements

92 Notes to and forming part of the Financial Statements 30 June 2018 Note 6: How we finance our operations

Note 6.4: Commitments for expenditure

2018 2017 $’000 $’000 Capital commitments: (Commitments* for the acquisition of fixed assets.) Payable Land and Buildings 1,211 14,182 Plant & Equipment Medical Equipment 2,687 2,253 Computer Equipment 14,472 16,275 Other Equipment 1,199 2,140 TOTAL CAPITAL COMMITMENTS 19,569 34,850 Payable Not later than one year 14,825 32,066 Later than one year but not later than 5 years 4,744 2,784 Later than 5 Years - - TOTAL 19,569 34,850 Operating commitments: (Commitments* for operating expenditure under contracts for the supply of services, materials and other but not recognised as liabilities) Supplies & Consumables Medical 318,469 122,557 Other 227,568 51,091 Maintenance Contracts Medical 4,470 6,817 Non-Medical 365 431 Information Technology 8,811 12,068 TOTAL OPERATING COMMITMENTS 559,683 192,964 Payable Not later than one year 155,606 65,300 Later than one year but not later than 5 years 397,870 108,092 Later than 5 Years 6,207 19,572 TOTAL 559,683 192,964 Lease Commitments: Commitments in relation to leases contracted for at the reporting date: Operating Lease 34,382 17,180 TOTAL LEASE COMMITMENTS 34,382 17,180 Payable Not later than one year 8,697 1,721 Later than one year but not later than 5 years 19,392 7,291 Later than 5 Years 6,293 8,168 TOTAL 34,382 17,180 TOTAL COMMITMENTS (INCLUSIVE OF GST) 613,634 244,994 Less GST recoverable from Australian Tax Office 55,785 22,272 TOTAL COMMITMENTS (EXCLUSIVE OF GST) 557,849 222,722

* Contracted commitments relates to contracts to expend amounts greater than $100,000 per year per contract. All amounts shown in the commitments note are nominal amounts inclusive of GST. Commitments for future expenditure include operating and capital commitments arising from contracts. These commitments are disclosed at their nominal value are not recognised and are inclusive of the GST payable. In addition, where it is considered appropriate and provides additional relevant information to users, the net present values of significant individual projects are stated. These future expenditures cease to be disclosed as commitments once the related liabilities are recognised on the

balance sheet. Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 93 Note 7: Risks, contingencies & valuation uncertainties

The Health Service is exposed to risk from its activities and outside factors. In addition, it is often necessary to make judgements and estimates associated with recognition and measurement of items in the financial statements. This section sets out financial instrument specific information, (including exposures to financial risks) as well as those items that are contingent in nature or require a higher level of judgement to be applied, which for the Health Service is related mainly to fair value determination. Structure 7.1: Financial instruments 7.1 (a): Financial instruments: categorisation 7.2: Net gain/ (loss) on disposal of non financial assets 7.3: Contingent assets and contingent liabilities

Note 7.1: Financial instruments

Financial instruments arise out of (a) Financial risk management The Health Service's main financial contractual agreements that give objectives and policies risks include credit risk, liquidity rise to a financial asset of one entity risk and interest rate risk. The Health Eastern Health’s principal financial and a financial liability or equity Service manages these financial risks instruments comprise of: instrument of another entity. Due in accordance with its Investment to the nature of Health Service's Cash Assets risk and credit risk practice guidelines. activities, certain financial assets and The Health Service uses different financial liabilities arise under statute Term Deposits methods to measure and manage rather than a contract. Such financial Receivable the different risks to which it is assets and financial liabilities do (excluding statutory receivables) exposed. Primary responsibility for not meet the definition of financial the identification and management instruments in AASB 132 Financial Payables of financial risks rests with Board Instruments: Presentation. (excluding statutory payables) with advice from the Finance Where relevant, for note disclosure Accommodation Bonds Committee of the Health Service. purposes, a distinction is made Details of the significant accounting The main purpose in holding financial between those financial assets and policies and methods adopted, instruments is to prudentially manage financial liabilities that meet the including the criteria for recognition, Eastern Health's financial risks within definition of financial instruments the basis of measurement and the the government policy parameters. in accordance with AASB 132 and basis on which income and expenses those that do not. are recognised, with respect to each The main purpose in holding financial class of financial asset, financial liability instruments is to prudentially manage and equity instrument are disclosed in Eastern Health’s financial risks within note 1 to the financial statements. the government policy parameters. Financial Statements Financial Statements

94 Notes to and forming part of the Financial Statements 30 June 2018 Note 7: Risks, contingencies & valuation uncertainties

Note 7.1: Financial instruments (continued) (a) Financial instruments: categorisation

Contractual Contractual financial assets financial – loans and liabilities at receivables amortised cost Total 2018 $’000 $’000 $’000

Contractual Financial Assets Cash and cash equivalents 41,017 - 41,017 Receivables 11,047 - 11,047 Other debtors 12,000 - 12,000 Other Financial assets 8,207 - 8,207 TOTAL FINANCIAL ASSETS (I) 72,271 - 72,271 Financial Liabilities Payables - 58,523 58,523 Interest Bearing Liabilities - 20,531 20,531 Other Liabilities - 8,248 8,248

TOTAL FINANCIAL LIABILITIES (II) - 87,302 87,302

Contractual Contractual financial assets financial – loans and liabilities at receivables amortised cost Total 2017 $’000 $’000 $’000

Contractual Financial Assets Cash and cash equivalents 4,542 - 4,542 Receivables 9,944 - 9,944 Other debtors 11,905 - 11,905 Other Financial assets 6,746 - 6,746 TOTAL FINANCIAL ASSETS (I) 33,137 - 33,137 Financial Liabilities Payables - 59,660 59,660 Interest Bearing Liabilities - 14,837 14,837 Other Liabilities - 6,787 6,787 TOTAL FINANCIAL LIABILITIES (II) - 81,284 81,284

NOTES: (i) The total amount of financial assets disclosed here excludes statutory receivables (i.e. GST input tax recoverable). (ii) The total amount of financial liabilities disclosed here excludes statutory payables (i.e. Taxes payable). Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 95 Note 7: Risks, contingencies & valuation uncertainties

Note 7.1: Financial instruments (continued) Categories of Non-Derivative Financial Instruments

(a) Loans and Receivables (b) Financial Liabilities at Financial instrument liabilities Loans and receivables are financial Amortised Cost measured at amortised cost include instrument assets with fixed and Financial instrument liabilities are all of Eastern Health Services's determinable payments that are not initially recognised on the date they contractual payables, deposits quoted on an active market. These are originated. They are initially held and advances received, and assets are initially recognised at fair measured at fair value plus any interest-bearing arrangements value plus any directly attributable directly attributable transaction costs. other than those designated at fair transaction costs. Subsequent to initial Subsequent to initial recognition, value through the Comprehensive measurement, loans and receivables these financial instruments are Operating Statement. are measured at amortised cost using measured at amortised cost the effective interest method, less with any difference between the any impairment. initial recognised amount and the redemption value being recognised Loans and receivables category in the Comprehensive Operating includes cash and deposits, term Statement over the period of the deposits with maturity greater than interest-bearing liability. three months, trade receivable and other receivables, but not statutory receivables.

Note 7.2: Net gain/(loss) on disposal of non financial assets

2018 2017 $’000 $’000

Proceeds from Disposals of Non-Current Assets Plant & Equipment Major Medical Equipment 10 - Computers & Communications - - Buildings - - Furniture & Fittings - 56 Motor Vehicles 261 467 TOTAL PROCEEDS FROM DISPOSAL OF NON-CURRENT ASSETS 271 523 Less: Written Down Value of Non-Current Assets Sold or Disposed Plant & Equipment Major Medical Equipment 36 403 Computers & Communications 3 4 Buildings - 160 Furniture & Fittings - - Motor Vehicles 196 305 TOTAL WRITTEN DOWN VALUE OF NON CURRENT ASSETS SOLD 235 872 NET GAIN/(LOSS) ON DISPOSAL OF NON-CURRENT ASSETS 36 (349) Financial Statements Financial Statements

96 Notes to and forming part of the Financial Statements 30 June 2018 Note 7: Risks, contingencies & valuation uncertainties

Note 7.2: Net gain/(loss) on disposal of non financial assets (continued)

Any gain or loss on the sale of Where an assets carrying value if no impairment loss had been non-financial assets is recognised exceeds its recoverable amount, the recognised in prior years. in the comprehensive operating difference is written off as an expense statement. Any gain or loss is except to the extent that the write It is deemed that, in the event of recognised at the date of disposal and down can be debited to an asset the loss or destruction of an asset, is the difference between the proceeds revaluation reserve amount applicable the future economic benefits arising and the carrying value of the asset at to that class. from the use of the asset will be the time that control of the asset is replaced unless a specific decision passed to the buyer. If there is an indication that there has to the contrary has been made. been a reversal in the estimate of an The recoverable amount for most Impairment of non-financial assets recoverable amount since the assets is measured at the higher of last impairment loss was recognised, depreciated replacement cost and assets the carrying amount shall be increased fair value less costs of disposal. All non-financial assets are assessed to its recoverable amount. annually for indications of impairment, Recoverable amount for assets except for inventories. This reversal of the impairment held primarily to generate net cash loss occurs only to the extent that inflows is measured at the higher If there is an indication of impairment, the asset’s carrying amount does of the present value of future cash the assets concerned are tested as to not exceed the carrying amount flows expected to be obtained from whether their carrying value exceeds that would have been determined, the asset and fair value less costs their possible recoverable amount. net of depreciation or amortisation, of disposal.

Note 7.3: Contingent assets & contingent liabilities

The Health Service has no quantifiable or non-quantifiable contingent assets or liabilities to report as at 30 June 2018 (2016-17 Nil). Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 97 Note 8: Other disclosures

This section includes additional material disclosures required by accounting standards or otherwise, for the understanding of this financial report. Structure 8.1: Equity 8.6: Related parties 8.2: Reconciliation of net result for the 8.7: Remuneration of auditors year to net cash inflow/(outflow) 8.8: AASBs issued that are not yet effective from operating activities 8.9: Events occurring after the balance 8.3: Operating segments sheet date 8.4: Responsible persons disclosures 8.10: Economic dependency 8.5: Executive officer disclosures 8.11: Glossary of terms and style conventions

Note 8.1: Equity

2018 2017 $’000 $’000 (a) Surpluses Property, Plant & Equipment Revaluation Surplus (i) Balance at the beginning of the reporting period 217,069 215,640 Revaluation Increments/(Decrements) Land - 1,429 Buildings 61,008 - BALANCE AT THE END OF THE REPORTING PERIOD 278,077 217,069 Represented by: Land 69,586 69,586 Buildings 208,491 147,483 BALANCE AT THE END OF THE REPORTING PERIOD 278,077 217,069 Restricted Specific Purpose Reserve Balance at the beginning of the reporting period 30,553 27,920 Transfer (to) / from Restricted Specific Purpose Reserve 1,070 2,633 BALANCE AT THE END OF THE REPORTING PERIOD 31,623 30,553 TOTAL SURPLUSES 309,700 247,622 (b) Contributed Capital Balance at the beginning of the reporting period 247,546 236,964 Capital contribution received from Victorian Government 216 10,582 BALANCE AT THE END OF THE REPORTING PERIOD 247,762 247,546 (c) Accumulated Surpluses/(Deficits) Balance at the beginning of the reporting period 181,512 212,667 Net Result for the Year (13,201) (28,522) Transfer (to) / from Restricted Specific Purpose Reserve (1,070) (2,633) BALANCE AT THE END OF THE REPORTING PERIOD 167,241 181,512 (D) TOTAL EQUITY AT THE END OF FINANCIAL YEAR 724,703 676,680

NOTE:

Financial Statements Financial Statements (i) The property, plant & equipment asset revaluation surplus arises on the revaluation of property, plant and equipment.

98 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.1: Equity (continued)

Contributed Capital Transfers of net assets arising from Restricted specific purpose administrative restructurings are Consistent with Australian Accounting surplus treated as contributions by owners. Interpretation 1038 Contributions Transfers of net liabilities arising from A specific restricted purpose surplus is by Owners Made to Wholly-Owned administrative restructures are to go established where the Health Service Public Sector Entities and FRD through the comprehensive operating has possession or title to the funds but 119A Contributions by Owners, statement. has no discretion to amend or vary the appropriations for additions to the restriction and/or condition underlying net asset base have been designated the funds received. as contributed capital. Property, plant & equipment revaluation surplus Other transfers that are in the nature The asset revaluation surplus is used of contributions to or distributions by to record increments and decrements owners that have been designated as on the revaluation of non-current contributed capital are also treated physical assets. as contributed capital.

Note 8.2: Reconciliation of net result for the year to net cash inflow/(outflow) from operating activities

2018 2017 $’000 $’000

Net Result for the period (13,201) (28,522) Non-cash movements Depreciation & Amortisation 69,042 69,362 Movements included in investing and financing activities Net (Gain)/Loss from disposal of non financial physical assets (36) 349 Capital Grant - Indirect Contribution by Department of Health & Human Services (1,296) (5,291) Grant - Indirect Contribution by Department of Health & Human Services (7,216) (8,949) Discount interest expense / (revenue) on Financial instrument (648) (186) Movements in assets and liabilities (Increase)/Decrease in receivables 4,132 497 (Increase)/Decrease in other assets (651) 826 Increase/(Decrease) in provision for doubtful debts 22 713 Increase/(Decrease) in other liabilities 4,014 (71) Increase/(Decrease) in payables (873) 341 Increase/(Decrease) in employee benefits 24,712 18,987 NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES 78,001 48,056 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 99 Note 8: Other disclosures

Note 8.3: Operating segments

Net result Acquisition Non cash from of property Depreciation expenses Segment Segment ordinary Segment Segment Segment plant & & other than revenue expenditure activities assets liabilities equity equipment amortisation depreciation 2018 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Segment Hospital 1,059,201 1,072,503 (13,302) 1,012,773 298,173 714,600 49,650 68,727 (36) Nursing Homes 10,054 9,591 463 15,865 8,311 7,554 128 212 - Hostel 1,182 1,544 (362) 4,615 2,066 2,549 36 103 - TOTAL 1,070,437 1,083,638 (13,201) 1,033,253 308,550 724,703 49,814 69,042 (36)

Net result Acquisition Non cash from of property Depreciation expenses Segment Segment ordinary Segment Segment Segment plant & & other than revenue expenditure activities assets liabilities equity equipment amortisation depreciation 2017 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Segment Hospital 997,237 1,025,958 (28,721) 931,379 264,763 666,616 53,745 69,048 1,062 Nursing Homes 9,799 9,425 374 13,715 6,263 7,452 135 207 - Hostel 1,394 1,569 (175) 5,128 2,516 2,612 21 107 - TOTAL 1,008,430 1,036,952 (28,522) 950,222 273,542 676,680 53,901 69,362 1,062

Geographical Segment Nursing Homes / Hostels Nursing Home The Health Service operates The Commonwealth Government This segment includes all activities predominantly in Melbourne regulates and partly funds the associated with both the Aged Care (Eastern suburbs and the Yarra Valley), provision of residential care for frail, and Psychogeriatric Nursing Homes Victoria. More than 90% of revenue, older people who can no longer live forming part of the Health Service. net result from ordinary activities and independently in their own home. Residents typically are those people segment assets, relates to operations There are two levels of care and who have been assessed by ACAT in Melbourne (Eastern suburbs and although they are officially called low or Psychogeriatric Assessment the Yarra Valley), Victoria. level residential care and high level Team (PGAT) as requiring high residential care they are still widely level residential care. Business Segments known and referred to as hostels and nursing homes, respectively. Hostel Hospital This segment includes all activities Before a person can enter a hostel or This segment includes all activities typically associated with residents nursing home they must be assessed directed to people who need medical who have been assessed by ACAT as and approved for care by an Aged or nursing care before resuming their requiring a low level residential care. Care Assessment Team (ACAT). normal lives in the community. ACATs are generally made up of local doctors, nurses, social workers and the like and they are usually located at hospitals, aged care centres or community centres. Financial Statements Financial Statements

100 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.4: Responsible persons disclosures

In accordance with the Ministerial Directions issued by the Minister for Finance under theFinancial Management Act 1994, the following disclosures are made regarding responsible persons for the reporting period.

Period

Responsible ministers The Honourable Jill Hennessy, Minister for Health, Minister for Ambulance Services 1/07/2017 - 30/06/2018

The Honourable Martin Foley, Minister for Housing, Disability and Ageing, Minister for 1/07/2017 - 30/06/2018 Mental Health, Minister for Equality, Minister for Creative Industries Governing board Dr Joanna Flynn AM 1/07/2017 - 30/06/2018 Dr Peter Dohrmann 1/07/2017 - 30/06/2018 Mr Stuart Alford (appointment expired 30/6/18) 1/07/2017 - 30/06/2018 Professor Andrew Conway 1/08/2017 - 30/06/2018 Ms Jill Linklater 1/07/2017 - 30/06/2018 Professor Pauline Nugent (appointment expired 30/6/18) 1/07/2017 - 30/06/2018 Mr Anastasios Mousaferiadis 1/07/2017 - 30/06/2018 Ms Joanna Walker 1/07/2017 - 30/06/2018 Hon Fran Bailey 1/07/2017 - 30/06/2018 Accountable officer Mr David Plunkett 1/07/2017 - 30/06/2018

Remuneration of Responsible Persons The number of Responsible persons are shown in their relevant income bands. The total remuneration of Responsible Persons includes superannuation and bonuses.

No of No of directors & directors & accountable accountable officer officer Income Bands 2018 2017 $30,001 - $40,000 8 7 $70,001 - $80,000 1 1 $130,001 - $140,000 - 1 $290,001 - $300,000 - 1 $410,001 - $420,000 1 - TOTAL NUMBERS 10 10 TOTAL REMUNERATION RECEIVED OR DUE AND RECEIVABLE BY $783,395 $765,164 RESPONSIBLE PERSONS FROM EASTERN HEALTH AMOUNTED TO:

Amounts relating to Responsible Ministers are reported in the financial statements of the Department of Premier and Cabinet. For information regarding related party transaction of ministers, the register of members interests is publicly available from www,parliament.vic.gov.au/publications/registerof interests. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 101 Note 8: Other disclosures

Note 8.5: Executive officer disclosures Executive Officers’ Remuneration The number of executive officers, other than Ministers and Accountable Officers, and their total remuneration during the reporting period are shown in the table under the different remuneration categories.

2017-18 2016-17

Remuneration Short-term benefits** 2,142,530 1,897,891 Other long-term benefits 70,932 63,189 Post - employment benefits 222,611 233,645 TOTAL REMUNERATION 2,436,073 2,194,725

TOTAL ANNUALISED EMPLOYEE EQUIVALENT (AEE)* 8 8 TOTAL NUMBER OF EXECUTIVES 8 10

* Annualised employee equivalent is based on working 38 hours per week over the reporting period. ** The short term benefits excludes any Long Service Leave paid during the year. Remuneration for Executive Officers and the Accountable Officer is determined by the Government Sector Executive Remuneration Panel (GSERP).

Note 8.6: Related parties

The hospital is a wholly owned Significant transactions with and controlled entity of the State government-related entities. of Victoria. Eastern Health received or has Related parties of the hospital include: receivable funding from the Department of health and Human all key management personnel Services of $883 million (2017 $819 and their close family members; million) and Eastern Health receivable all cabinet ministers and their funding for Long Service Leave is close family members; and $43 million (2017 $42 million).

all hospitals and public sector Key management personnel (KMP) of entities that are controlled and the Health Service include the Portfolio consolidated into the whole of state Ministers and Cabinet Ministers and consolidated financial statements. KMP as determined by the Health Service. The compensation detailed All related party transactions have below excludes the salaries and been entered into on an arm’s benefits the Portfolio Ministers receive. length basis. The Minister’s remuneration and allowances is set by the Parliamentary Salaries and Superannuation Act 1968, and is reported within the Department of Parliamentary Services’ Financial Report. Financial Statements Financial Statements

102 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.6: Related parties (continued)

2018 2017 $’000 $’000

Compensation Short term employee benefits 2,756 2,593 Post-employment benefits 287 304 Other long-term benefits 85 76 Termination benefits - - Share based payments - - TOTAL 3,128 2,973

Transactions with key management personnel and other related parties Given the breadth and depth of State Procurement processes occur on All other transactions that have government activities, related parties terms and conditions consistent occurred with KMP and their transact with the Victorian public with the Victorian Government related parties have been trivial or sector in a manner consistent Procurement Board requirements. domestic in nature. In this context, with other members of the public Outside of normal citizen type transactions are only disclosed e.g. stamp duty and other government transactions with the department, when they are considered of fees and charges. Further employment there were no related party interest to users of the financial of processes within the Victorian transactions that involved key report in making and evaluation public sector occur on terms and management personnel and their decisions about the allocation of conditions consistent with the Public close family members. No provision scare resources. Administration Act 2004 and Codes of has been required, nor any expense Conduct and Standards issued by the recognised, for impairment of Victorian Public Sector Commission. receivables from related parties.

Note 8.7: Remuneration of auditors

Auditors fees paid or payable to the Victorian Auditor-General’s Office for audit of Eastern Health’s financial statements.

2018 2017 $’000 $’000 Audit fees paid or payable to the Victorian Auditor-General’s Office for the audit of Eastern Health’s current financial report 123 120 TOTAL PAID OR PAYABLE 123 120 Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 103 Note 8: Other disclosures

Note 8.8: AASBS issued that are not effective yet Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2018 reporting period. DTF assesses the impact of these new standards and advises the Health Services of their applicability and early adoption where applicable. As at 30 June 2018, the following standards and interpretations had been issued by the AASB but were not yet effective. They become effective for the first financial statements for reporting periods commencing after the stated operative dates as detailed in the table below. Eastern Health has not and does not intend to adopt these standards early.

Applicable for Impact on health Standard/ reporting periods service’s annual interpretation Summary beginning after statements

AASB 16 The key changes introduced by AASB 16 1 January 2019 The preliminary Leases include the recognition of most operating assessment has leases (which are currently not recognised) identified a material on balance sheet. impact arising from AASB 16. The effect is approximately $34.3 million reclassification of Operating Leases that need to be disclosed on balance sheet.

AASB 9 The key changes include the simplified 1 January 2018 The assessment has Financial Instruments requirements for the classification and identified that the measurement of financial assets, a new amendments are hedging accounting model and a revised likely to result in impairment loss model to recognise earlier recognition of impairment losses earlier, as opposed impairment losses and at to the current approach that recognises more regular intervals. impairment only when incurred. While there will be no significant impact arising from AASB 9, there will be a change to the way financial instruments are disclosed.

AASB 2014-7 Amends various AASs to incorporate the 1 January 2018 The assessment has Amendments to consequential amendments arising from indicated that there will Australian Accounting the issuance of AASB 9. be no significant impact Standards arising for the public sector. from AASB 9

AASB 1058 This standard replaces AASB 1004 1 January 2019 The preliminary Income for Contributions and establishes revenue assessment has Not-for-Profit Entities recognition principles for transactions not identified any where the consideration to acquire an material impact arising asset is significantly less than fair value from AASB 1058, it to enable to not-for-profit entity to further will continue to be its objectives. monitored and assessed.

AASB 2016-8 This Standard defers the mandatory 1 January 2018 This amending standard Amendments effective date of AASB 15 from 1 January will defer the application to Australian 2018 to 1 January 2019. period of AASB 15 for Accounting for-profit entities to the Standards – Effective 2018-19 reporting period Date of AASB 15 in accordance with the transition requirements. Financial Statements Financial Statements

104 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.8: AASBS issued that are not effective yet (continued)

Applicable for Impact on health Standard/ reporting periods service’s annual interpretation Summary beginning after statements

AASB 2017-3 This Standard amends AASB 15 to 1 January 2018 The assessment has Amendments clarify the requirements on identifying indicated that there to Australian performance obligations, principal will be no significant Accounting Standards versus agent considerations and the timing impact for the public – Clarifications to of recognising revenue from granting a sector, other than the AASB 15 licence. The amendments require: impact identified for AASB 15 above. A promise to transfer to a customer a good or service that is ‘distinct’ to be recognised as a separate performance obligation;

For items purchased online, the entity is a principal if it obtains control of the good or service prior to transferring to the customer; and

For licences identified as being distinct from other goods or services in a contract, entities need to determine whether the licence transfers to the customer over time (right to use) or at a point in time (right to access).

AASB 2017-7 This Standard defers the mandatory 1 January 2019 This amending Amendments to effective date of AASB 15 for not-for-profit standard will defer Australian Accounting entities from 1 January 2018 to 1 January the application period Standards – 2019. of AASB 15 for Deferral of AASB 15 not-for-profit entities for Not-for-Profit to the 2019-20 Entities reporting period.

AASB 2017-4 The standard amends AASB 136 Impairment 1 January 2018 The assessment has Amendments of Assets to remove references to using indicated that there is to Australian depreciated replacement cost (DRC) as a minimal impact. Given Accounting Standards measure of value in use for not-for-profit the specialised nature – Recoverable entities. and restrictions of Amount of Non- public sector assets, Cash-Generating the existing use is Specialised Assets of presumed to be the Not-for-Profit Entities highest and best use (HBU), hence current replacement cost under AASB 13 Fair Value Measurement is the same as the depreciated replacement cost concept under AASB 136. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 105 Note 8: Other disclosures

Note 8.8: AASBS issued that are not effective yet (continued)

Applicable for Impact on health Standard/ reporting periods service’s annual interpretation Summary beginning after statements

AASB 15 The core principle of AASB 15 requires 1 January 2018 The preliminary Revenue from an entity to recognise revenue when the assessment has not Contracts with entity satisfies a performance obligation identified any material Customers by transferring a promised good or impact arising from service to a customer. AASB 15, it will continue to be monitored and assessed.

AASB 2014-5 Amends the measurement of trade 1 January 2018, The assessment has Amendments to receivables and the recognition of except amendments indicated that there will Australian Accounting dividends. to AASB 9 be no significant impact Standards arising (December 2009) for the public sector. Trade receivables, that do not have a from AASB 15 and AASB 9 significant financing component, are to (December 2010) be measured at their transaction price, apply from at initial recognition. 1 January 2018 Dividends are recognised in the profit and loss only when: the entity’s right to receive payment of the dividend is established;

it is probable that the economic benefits associated with the dividend will flow to the entity; and

the amount can be measured reliably.

In addition to the new standards AASB 2017-2 above, the AASB has issued a list of Amendments to Australian amending standards that are not Accounting Standards – effective for the 2017-18 reporting Disclosure Initiative: period (as listed below). In general, Amendments to AASB 107 these amending standards include AASB 2018-2 editorial and references changes that Amendments to Australian are expected to have insignificant Accounting Standards – impacts on public sector reporting. Further Annual Improvements The AASB Interpretations in the 2014-16 list below are also not effective for the 2017-18 reporting period and considered to have insignificant impacts on public sector reporting. Financial Statements Financial Statements

106 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.9: Events occurring after the balance sheet date

Assets, liabilities, income or expenses those events provide information arise from past transactions or other about conditions which existed at past events. Where the transactions the reporting date. Note disclosure is result from an agreement between made about events between the end the Health Service and other parties, of the reporting period and the date the transactions are only recognised the financial statements are authorised when the agreement is irrevocable for issue where the events relate at or before the end of the reporting to conditions which arose after the period. end of the reporting period that are considered to be of material interest. Adjustments are made to amounts recognised in the financial statements At the time the report was being for events which occur between the prepared and signed the Board is not end of the reporting period and the aware of any events that could have date when the financial statements a material impact on the financial are authorised for issue, where statements.

Note 8.10: Economic dependency

Eastern Health is wholly dependent from operations is $78.001 million on the continued financial support surplus (2017: $48.056 million) and of the State Government and in cash reserves have moved from $4.542 particular, the Department of Health million in 2017 to $41.017 million in and Human Services. 2018. A letter confirming adequate cash flow was provided in the previous The Department of Health and Human financial year. Services has provided confirmation that it will continue to provide the The financial statements have been Eastern Health adequate cash flow prepared on a going concern basis. support to meet its current and future The State Government and the obligation as and when they fall due Department of Health and Human for a period up to September 2019. Services have confirmed financial support to settle the Eastern Health's The Health Service's current asset ratio financial obligations when they continues to be below an adequate fall due. short term position (2018: 032 and 2017: 0.18) while cash generated Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 107 Note 8: Other disclosures

Note 8.11: Glossary of terms and style conventions

Actuarial gains or losses allocating interest income over the a derivative that will or may on superannuation defined relevant period. The effective interest be settled other than by the benefit plans rate is the rate that exactly discounts exchange of a fixed amount of estimated future cash receipts through cash or another financial asset Actuarial gains or losses are the expected life of the financial for a fixed number of the entity’s changes in the present value of instrument, or, where appropriate, own equity instruments. the superannuation defined benefit a shorter period. liability resulting from Financial instrument (a) experience adjustments (the Employee benefits expenses A financial instrument is any contract effects of differences between the Employee benefits expenses include all that gives rise to a financial asset of previous actuarial assumptions and costs related to employment including one entity and a financial liability or what has actually occurred); and wages and salaries, fringe benefits equity instrument of another entity. tax, leave entitlements, redundancy Financial assets or liabilities that are the effects of changes in actuarial (b) payments, defined benefits not contractual (such as statutory assumptions. superannuation plans, and defined receivables or payables that arise as contribution superannuation plans. a result of statutory requirements Amortisation imposed by governments) are not Amortisation is the expense which Ex gratia expenses financial instruments. results from the consumption, Ex-gratia expenses mean the extraction or use over time of a voluntary payment of money or other Financial liability non-produced physical or intangible non-monetary benefit (e.g. a write A financial liability is any liability that is: asset. off) that is not made either to acquire A contractual obligation: goods, services or other benefits for (a) Comprehensive result the entity or to meet a legal liability, (i) to deliver cash or another The net result of all items of income or to settle or resolve a possible legal financial asset to another and expense recognised for the period. liability, or claim against the entity. entity; or It is the aggregate of operating result and other comprehensive income. Financial asset (ii) to exchange financial assets or financial liabilities with another A financial asset is any asset that is: Commitments entity under conditions that (a) cash; are potentially unfavorable to Commitments include those the entity; or operating, capital and other (b) an equity instrument of another outsourcing commitments arising entity; (b) A contract that will or may be from non-cancellable contractual settled in the entity’s own equity or statutory sources. (c) a contractual or statutory right: instruments and is:

to receive cash or another (i) a non-derivative for which the Current grants financial asset from another entity is or may be obliged Amounts payable or receivable entity; or to deliver a variable number for current purposes for which no of the entity’s own equity to exchange financial assets or economic benefits of equal value are instruments; or financial liabilities with another receivable or payable in return. entity under conditions that (ii) a derivative that will or are potentially favorable to the Depreciation may be settled other than entity; or by the exchange of a fixed Depreciation is an expense that arises amount of cash or another (d) a contract that will or may be from the consumption through wear financial asset for a fixed settled in the entity’s own equity or time of a produced physical or number of the entity’s own instruments and is: intangible asset. This expense reduces equity instruments. For this the ‘net result for the year’. a non-derivative for which the purpose the entity’s own entity is or may be obliged to equity instruments do not Effective interest method receive a variable number of the include instruments that are The effective interest method is entity’s own equity instruments; themselves contracts for the used to calculate the amortised cost or future receipt or delivery of a financial asset or liability and of of the entity’s own equity instruments. Financial Statements Financial Statements

108 Notes to and forming part of the Financial Statements 30 June 2018 Note 8: Other disclosures

Note 8.11: Glossary of terms and style conventions (continued)

Financial statements Intangible produced assets only those increases or decreases in non-financial assets resulting from A complete set of financial statements Refer to produced assets in this transactions and therefore excludes comprises: glossary. write-offs, impairment write-downs and revaluations. (a) Balance sheet as at the end of Interest expense the period; Costs incurred in connection with the Net result (b) Comprehensive operating borrowing of funds includes interest statement for the period; Net result is a measure of financial on bank overdrafts and short-term performance of the operations for the and long-term liabilities, amortisation (c) A statement of changes in equity period. It is the net result of items of for the period; of discounts or premiums relating income, gains and expenses (including to liabilities, interest component of losses) recognised for the period, Cash flow statement for the period; (d) finance leases repayments, and the excluding those that are classified as increase in financial liabilities and Notes, comprising a summary of ‘other comprehensive income’. (e) non-employee provisions due to significant accounting policies and the unwinding of discounts to reflect other explanatory information; Net result from transactions/ the passage of time. net operating balance (f) Comparative information in respect of the preceding period Interest income Net result from transactions or net operating balance is a key as specified in paragraph 38 of Interest income includes unwinding fiscal aggregate and is income AASB 101 Presentation of Financial over time of discounts on financial from transactions minus expenses Statements; and assets and interest received on bank from transactions. It is a summary term deposits and other investments. (g) A statement of financial position measure of the ongoing sustainability at the beginning of the preceding of operations. It excludes gains and period when an entity applies an Investment properties losses resulting from changes in price accounting policy retrospectively or Investment properties represent levels and other changes in the volume makes a retrospective restatement properties held to earn rentals or of assets. of items in its financial statements, for capital appreciation or both. or when it reclassifies items in its Investment properties exclude Net worth financial statements in accordance properties held to meet service Assets less liabilities, which is an with paragraphs 41 of AASB 101. delivery objectives of the State economic measure of wealth. of Victoria. General government sector Non-financial assets The general government sector Liabilities Non-financial assets are all assets comprises all government Liabilities refers to interest-bearing that are not ‘financial assets’. departments, offices and other bodies liabilities mainly raised from public It includes inventories, land, buildings, engaged in providing services free of liabilities raised through the Treasury infrastructure, road networks, land charge or at prices significantly below Corporation of Victoria, finance under roads, plant and equipment, their cost of production. General leases and other interest-bearing investment properties, cultural government services include those arrangements. Liabilities also include and heritage assets, intangible and which are mainly non-market in nature, non-interest-bearing advances from biological assets. those which are largely for collective government that are acquired for consumption by the community and policy purposes. those which involve the transfer Non-produced assets or redistribution of income. These Net acquisition of non-financial Non-produced assets are assets services are financed mainly through assets (from transactions) needed for production that have taxes, or other compulsory levies not themselves been produced. Purchases (and other acquisitions) and user charges. They include land, subsoil assets, of non-financial assets less sales (or and certain intangible assets. disposals) of non-financial assets Health Service Non-produced intangibles are less depreciation plus changes in intangible assets needed for The entity established under Section inventories and other movements production that have not themselves 181 of the Victorian Health Services in non-financial assets. It includes been produced. They include Act 1988 as a body corporate. constructs of society such as patents. Eastern Health 2017-2018 Annual Report 2017-2018 Annual Health Eastern

Notes to and forming part of the Financial Statements 30 June 2018 109 Note 8: Other disclosures

Note 8.11: Glossary of terms and style conventions (continued)

Non-profit institution Supplies and services A legal or social entity that is created Supplies and services generally for the purpose of producing or represent cost of goods sold and the distributing goods and services but day-to-day running costs, including is not permitted to be a source of maintenance costs, incurred in the income, profit or other financial gain normal operations of the Department. for the units that establish, control or finance it. Transactions Revised Transactions are those Payables economic flows that are considered Includes short and long term trade to arise as a result of policy decisions, debt and accounts payable, grants, usually an interaction between two taxes and interest payable. entities by mutual agreement. They also include flows in an entity Produced assets such as depreciation where the owner is simultaneously acting as the owner Produced assets include buildings, of the depreciating asset and as the plant and equipment, inventories, consumer of the service provided by cultivated assets and certain intangible the asset. assets. Intangible produced assets may include computer software, Taxation is regarded as mutually agreed motion picture films, and research and interactions between the government development costs (which does not and taxpayers. Transactions can be in nclude the startup costs associated kind (e.g. assets provided/given free of with capital projects). charge or for nominal consideration) or where the final consideration is cash. Receivables Includes amounts owing from Style conventions government through appropriation Figures in the tables and in the text receivable, short and long term have been rounded. Discrepancies trade credit and accounts receivable, in tables between totals and sums accrued investment income, grants, of components reflect rounding. taxes and interest receivable. Percentage variations in all tables are based on the underlying unrounded Sales of goods and services amounts. The notation used in the Refers to income from the direct tables is as follows: provision of goods and services and zero, or rounded to zero includes fees and charges for services rendered, sales of goods and services, (xxx.x) negative numbers fees from regulatory services and 201x year period work done as an agent for private enterprises. 201x-1x year period It also includes rental income under operating leases and on produced assets such as buildings and entertainment, but excludes rent income from the use of non-produced assets such as land. User charges includes sale of goods and services income. Financial Statements Financial Statements

110 Notes to and forming part of the Financial Statements 30 June 2018 Contacts Index and Glossary,

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111 111 Eastern Health 2017-2018 Annual Report Glossary

ACHS Australian Council on Healthcare Standards Acute episode A rapid onset and/or short course of illness Acute hospital Short-term medical and/or surgical treatment and care facility Agpar score A measure of the physical condition of a newborn baby Allied health professionals provide clinical healthcare, such as audiology, psychology, nutrition Allied health and dietetics, occupational therapy, orthotics and prosthetics, physical therapies including physiotherapy; speech pathology and social work Care given to a person who is not confined to a hospital/requiring hospital admission but rather Ambulatory care is ambulatory and literally able to “ambulate” or walk around BAU Business as usual CCTV Closed circuit television CSIRO Commonwealth Scientific and Industrial Research Organisation DHHS Department of Health and Human Services Discharge is the point at which a patient leaves the health service and either returns home or is Discharge transferred to another facility, such as a nursing home DRG Diagnosis Related Group DVA Department of Veterans’ Affairs An illness of at least six months’ duration that can have a significant impact on a person’s life and Chronic condition requires ongoing supervision by a healthcare professional Service that provides care in the comfort of a patient’s home or other suitable location. Eastern@Home Clients are still regarded as hospital inpatients and remain under the care of a hospital clinician. Care may be provided by nurses, doctors or allied health professionals. Hospitals use urgency categories to schedule surgery to ensure patients with the greatest clinical need are treated first. Each patient’s clinical urgency is determined by their treating specialist. Three urgency categories are used throughout Australia: Urgent: Admission within 30 days or condition(s) has the potential to deteriorate quickly to the point it may become an emergency. Elective surgery Semi-urgent: Admission within 90 days. The person’s condition causes some pain, dysfunction or disability. It is unlikely to deteriorate quickly/unlikely to become an emergency. Non-urgent: Admission some time in the future (within 365 days). The person’s condition causes minimal or no pain, dysfunction or disability. It is unlikely to deteriorate quickly/unlikely to become an emergency. There are five defined triage categories, determined by the Australasian College of Emergency Medicine, with the desirable time when treatment should commence for patients in each category who present to an emergency department: Category 1: Resuscitation; seen immediately Emergency triage Category 2: Emergency; seen within 10 minutes Category 3: Urgent; seen within 30 minutes Category 4: Semi-urgent; seen within one hour Category 5: Non-urgent; seen within two hours Emission Output or discharge, as in the introduction of chemicals or particles into the atmosphere EMR Electronic Medical Record EQuIP National Four-year accreditation program for health services that ensures a continuing focus on quality Standards across the whole organisation Every Minute Matters This is the name given to a program of improvement initiatives FOI Freedom of information Full-time equivalent Glossary, Index and Contacts Contacts and Index Glossary, FTE

112 Method of assessing the differences in performance to determine whether requirements are Gap analysis being met and if not, what steps should be taken to ensure they are met GEM Geriatric evaluation and management GJ Gigajoule GST Goods and services tax ICT Information and communication technology ICU Intensive care unit A patient whose treatment needs at least one night’s admission in an acute or sub-acute Inpatient hospital setting KgCO2e Equivalent kilograms of carbon dioxide kL Kilolitre LGBTI Lesbian, gay, bisexual, transgender and intersex m2 Square metres MRI Magnetic resonance imaging MWh Megawatt hour NDIS National Disability Insurance Scheme NAATI National Accreditation Authority for Translators and Interpreters NSQHS Standards National Safety and Quality Health Service Standards OBD Occupied bed day Occasions of service Hospital contact for an outpatient, either through an on-site clinic or home visit OHS Occupational health and safety A hospital that has a statistically significantly higher infection rate for a particular surgical procedure group compared to the VICNISS five-year aggregate for that procedure (includes all Outlier contributing hospitals in Victoria). Testing for statistical significance is performed each quarter but is based on data from the most recent two quarters (six months). A person who is not hospitalised overnight but who may visit a hospital, clinic or associated Outpatient facility, or may be visited in the home by a clinician for diagnosis, ongoing care or treatment OVA Occupational violence and aggression Service that provides an alternative to emergency department presentations for clients in Residential in-reach residential aged care facilities. It aims to support clients and staff to manage acute health issues when general practitioners or locums are unavailable. SAB Staphylococcus aureus bacteraemia SAFE Safe, Aggression Free Environment This is the sole confinement of a person to a room or other enclosed space from which it is Seclusion event not within the control of the person confined to leave Separations Discharge from an outpatient service Sub-acute illness A condition that rates between an acute and chronic illness Any person, group or organisation that can lay claim to an organisation’s attention, resources Stakeholder or output, or is affected by that output TAC Traffic Accident Commission Describes the purpose and structure of a committee, or any similar collection of people, who Terms of reference have agreed to work together to accomplish a shared goal VAGO Victorian Auditor-General’s Office Victorian Healthc are Associated Infection Surveillance System. The “N” stands for a word VICNISS derived from Greek “nosocomial” meaning “originating in a hospital”. Hospitals are paid based on the numbers and types of patients they treat – the Victorian WIES health system defines a hospital’s admitted patient workload in terms of WIES (weighted inlier equivalent separations)

YTD Year to date Report 2017-2018 Annual Health Eastern

113 Index

Eastern Health A2i awards 48 E 42 Patient experience 26 A Foundation P People Matter Survey 28 Access to care 27 Elective surgery 27 Accreditation 24, 26 Electronic Medical People Strategy 44 14 Record Performance against Activity and funding 29 17-25 Emergency care 27 strategic priorities Additional information 32 Employment and Performance Excellence 47 16 Adverse events 26 conduct principles Framework Aggression management 12 Environmental Primary Care and 30 Angliss Hospital expansion 14 performance Population Health 39-40 eQuality 23 Advisory Committee Attestation on Compliance with Executive 41-42 Protected disclosures 31 Health Purchasing 33 Purpose, functions, Expenses by services 5 38 Victoria (HPV) Health powers and duties Purchasing Policies F Finance Committee 39 Q Quality and safe care 26 Attestation on Financial management 27 Quality and Safety Financial Management 37 Financial results summary 5 39 Committee Compliance Financial statements 51 Remuneration Committee 40 Australasian Reporting Back Freedom of information 31 R Awards cover Research grants 46 Fundraising 42 Auxiliaries 42 Responsible bodies Glossary 112 1 G declaration B Board committees 39-40 Governance 35 Reward and recognition 48 Board of Directors 37-38 Governance, leadership 28 and culture Revenue sources 5 Breast and Cancer Centre 14 Growth tables 28 Risk and Audit Committee 40 Buildings and facilities 33 H Hand hygiene 26 Risk management 34 C Carer involvement 31 Highlights 14 S SAB rate 26 Car parking 31 I ICT expenditure 33 Safe patient care 31 Inside Catchment map Immunisation 26 Serious injuries 13 cover Industrial relations 47 Slips, trips and falls 13 Chair and Chief Executive 2-3 Infections 26 report Specialist clinics 27 Interpreter services 25 Challenges and Staff 43 34 L Leadership 45 opportunities Stakeholders 16 Lost-time injuries 13 Chief Finance Officer 4 Statutory compliance 31-33 report Manner of M 1 establishment Strategic Plan 7-8 Clinical Governance 38 Framework Manual handling 13 Strategic priorities 16 Maternity and newborn 26 Strategy, People and Clinical programs and 40 11 IT Advisory Committee services Measuring our 18 performance VAGO statement 54-55 Community Advisory V 39 Committee Mental health 26 Inside Inside Values cover, Competitive neutrality 33 Mission cover 8, 44 Conflict of interest 33 National Competition Victorian Healthcare N 33 26 Connect with Respect 22 Policy Experience Survey Nursing and midwifery Victorian Industry Consultancies 32 48 33 awards Participation Policy Consumers 20 Occupational health 0 12-13 Inside Back and safety Vision Contact details cover cover Occupational violence 12 Volunteers 45 Continuing care 26 Operating expenses 5 W WIES 29 Contravention of OHS laws 13 Operating result 5 Who we are 10 Data integrity 33 Organisational profile 11 D Workforce data 46-47 Organisational structure 36 Glossary, Index and Contacts Contacts and Index Glossary, Disclosure index 49-50

114 Location 5 Arnold Street Box Hill, VIC 3128

Postal address PO Box 94 Box Hill, VIC 3128

General inquiries 1300 342 255 www.easternhealth.org.au Feedback

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Fill in our online feedback form at www.easternhealth.org.au Contact one of our 131 450 Patient Relations Advisers on 1800 327 837. Patient Relations Publications Advisers are available Monday to Friday from 9am to 5pm All of Eastern Health’s publications are available electronically via our Send an email to website at www.easternhealth.org.au [email protected] Write to us at: Eastern Health Foundation The Centre for Patient 03 9895 4608 Experience Wantirna Health [email protected] 251 Mountain Highway www.easternhealth.org.au/ Wantirna South, Victoria 3152 foundation Via the Patient Opinion website at www.patientopinion.org.au

Eastern Health received its third consecutiveGold Award for its Annual Report at the 2018 Australasian Reporting Awards (ARA). Primarily a benchmarking activity, the awards recognise organisations that are able to satisfy the ARA criteria after a comprehensive review by an expert panel of accounting, legal and communications professionals. To receive a Gold Award, the report must “demonstrate overall excellence in annual reporting and provide high-quality coverage of most aspects of the ARA criteria; full disclosure of key aspects of the core business and outstanding disclosures in major areas. A report that achieves a Gold Award is a model for other © Eastern Health 2018 organisations to follow”. ABN 68 223 819 017