Evaluation of the national mental health strategy

Service mix

Page last updated: December 1997

Central to the vision promoted by the National Mental Health Strategy is the idea that a good mental health service requires a core set of components, which place the locus of care in the community. The Strategy therefore advocated a fundamental shift in the service balance, away from the historical reliance on separate psychiatric hospitals. A range of new service elements was envisaged, which would be linked to form a single, integrated service system that emphasised continuity of care, both over time and across service boundaries.

Major structural reform was foreshadowed, designed to transfer resources to new community-based services and devolve service management from the State and Territory central health bureaucracies to the mainstream health system.

Commonwealth funds released under the Strategy were intended to facilitate the transition, and tied largely to service mix objectives. As a safeguard against cost shifting, Medicare Agreements required each party to maintain their previous level of mental health expenditure throughout the reform period.

The direction set by the Strategy has led to changes in the structure and mix of mental health services that are unparalleled in Australia's history. Key developments of the 1992-1996 period are summarised below.1

  • Expansion in the range of services beyond the separate psychiatric hospital
    Spending on non institutional care grew by 55% in real terms ($216 million), with the majority of this directed to ambulatory services ($135 million) and acute services in general hospitals ($41 million; see figure 3). Mental health service providers working in community settings increased from approximately 4,100 to 5,900 while acute beds in general hospitals increased by 20% (395 beds).

  • Reduction in psychiatric hospitals
    Approximately 1,800 beds in stand alone psychiatric hospitals – 31% of the 1992 stock – were closed in the first four years of the Strategy. The share of total recurrent expenditure allocated to these services reduced from 49% to 35%. Reductions have been targeted largely at longer-term (or 'non acute') beds, with overall acute bed numbers remaining stable (see figure 4).

  • Resource base maintained
    Estimated State and Territory spending on mental health services increased by 6.3% in real terms, and for the Commonwealth, by 61%, the latter mainly attributable to increased Pharmaceutical Benefits Scheme expenditure and allocations made under the Strategy.

  • Mainstreaming
    At the beginning of the 1990's, the majority of State and Territory mental health services operated under separate management arrangements isolated from general health care. By 1996, all jurisdictions had fully transferred management to the same arrangements that apply to mainstream health care.

  • State and Territory mental health plans
    New or revised plans reflecting the national directions have been released by most of the States and Territories over the past four years.
Data collected for the 1996 National Mental Health Report (see figure 5) suggest that the Commonwealth- State/Territory partnership on which the Strategy was premised has functioned as anticipated. 55% of the growth of alternative services has been funded through savings returned by States from downsizing their psychiatric hospitals. Commonwealth funds have provided an important stimulus in the early period, supporting 31% of service growth in 1994 and diminishing to 22% in 1996.

This aspect of the Strategy – where mutual obligations are upheld and subjected to public scrutiny - is widely regarded as a model for Commonwealth- State reform agreements in other areas.

Beneath the national level, the scale and pace of change is not uniform across the jurisdictions. Development in several States is slow, and considerable disparity exists between regions with services in most rural areas being particularly undeveloped. All jurisdictions continue to depend on Commonwealth transitional funds and will be challenged to find alternative sources to maintain the new services when the current agreement expires in July 1998.

Broad support for the new service directions was evident across both the local area and national consultations. Where new community services have been established, these are especially valued and seen as the 'backbone' of the service.

But for many, the Strategy vision of accessible, responsive and integrated services has little resemblance to current reality. National groups responding to the evaluation most frequently identified service mix issues as the highest priority for future attention. Similarly, in the four area case studies, where local services were pursuing goals consistent with the Strategy, many problems were apparent in terms of access, continuity of care and service quality.Top of page

Key issues of concern included:
  • Service gaps
    Even in the areas where the range and level of services were substantially more developed than the Australian average, consumers and providers reported high levels of unmet need.

  • Limited access to acute beds
    Despite the maintenance of acute bed levels over the period of the Strategy, it was frequently reported that access to acute care has reduced and premature discharges increased.

  • Community services as gatekeepers
    New community teams were valued where they provided care and treatment, but too often these new resources were seen as solely directed to filtering access to the hospital acute unit.

  • Inadequate case management systems
    Both the national and local area consultations reported little improvement in continuity of care arrangements over the past four years. Insufficient use is made of case managers to coordinate care.

  • Insufficient emphasis on rehabilitation and personal recovery
    Services that emphasise the 'person not the illness' were argued as necessary to achieve a balanced care system. Greater emphasis on the role of the specialised mental health 'non government sector' was advocated.Top of page

  • Undeveloped 'special needs' services
    Although the Strategy argues for service planning to cater for special need groups, service development has mainly emphasised development of general services, targeted at people with psychotic disorders. Providers perceive that specialisation in the mental health workforce is no longer valued, and as a consequence, services for people with special needs will remain undeveloped. A range of groups has been identified as having special needs. These include, for example, children of people with mental illness, survivors of torture, trauma, or child and sexual abuse, Aboriginal and Torres Strait Islander peoples, people from non English speaking backgrounds, people with dual disabilities, homeless youth as well as others described in the professional literature.

  • Lack of skilled workforce
    As indicated earlier, consumers and providers alike believe that inadequate attention has been given to training the mental health workforce to work in the new service delivery environment. Training is needed not only to equip professionals with the necessary technical skills, but also to encourage attitudes and values that are congruent with the ideals of the National Mental Health Strategy.
    Strong views were expressed that this problem is particularly apparent in inpatient services, where the transfer of senior and skilled staff to new community services has depleted the pool of expertise.
    Specific mention was made of the training of nursing professionals, who make up 55% of the mental health workforce. Professional groups suggested that there has been a significant decline of the number of nurses with specialist psychiatric qualifications employed in mental health services. This may have been influenced to some extent by the transfer of nursing education to the tertiary sector and the replacement of specialist training with comprehensive nursing curricula. There is particular concern that neither the current salary schedules nor employer assistance schemes give any incentive for general trained nurses to complete specialist psychiatric qualifications.

  • Barriers between the private and public sectors
    Minimal communication between local public mental health services and private psychiatrists was seen to contribute to poor outcomes for consumers.

  • Inadequate rural services
    Much of the effort over recent years has been focused on populations in metropolitan areas. With a few notable exceptions, services in rural and remote areas are yet to benefit from the activity generated by the National Mental Health Strategy.
Overall, there is little doubt that the directions defined by the Strategy have won the support of disparate groups. While these groups acknowledged that positive change was underway, their common theme is that the direction is right, but the correct service balance is yet to be found.

The strategic message for the future is that development of the 'right mix' involves more than putting a set of service components in accessible locations. It is as much about the quality of services as it is about building blocks and geography.

The development of planning tools, workforce initiatives and assistance to organisations during the transitional period are areas where national leadership is required.Top of page

Table 5: Service mix policy objectives

Table 5 is presented as a list in this HTML version for accessibility reasons. It is presented as a table in the PDF version.

Service mix policy objectives:
  • To ensure each State/Territory and area/region has a plan for the mix of services available to its population and that this plan is developed through a consultative process that takes account of the needs of special groups.
  • To reduce the size or to close existing psychiatric hospitals, and at the same time provide sufficient acute hospital, accommodation, and community based services.
  • To upgrade the remaining psychiatric facilities which are needed to provide treatment or care on a medium or long-term basis for those whose appropriate placement is in separate specialist psychiatric hospital facilities.
  • To decentralise the provision of psychiatric hospital services to ensure adequate access across all areas/regions to general hospital inpatient services and community based services including crisis, assessment and treatment, rehabilitation/ support, and domiciliary and outreach services.
  • To increase the number and range of community based supported accommodation services and ensure a range that provides a level of support appropriate to the needs of the consumer.
  • To identify areas where the separation of Commonwealth and State funding for mental health treatment services compromises the targeting, integration, and distribution of mental health services and to introduce measures to overcome this.

Source: National Mental Health Policy, 1992

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Figure 3: National changes in the mix of public mental health services

Text equivalent below for Figure 3: National changes in the mix of public mental health services

Note: expenditure in constant 1996 prices

Text version of Figure 3

Psych Hosp
$537M (49.2%)
$419M (35.2%)
$21M (1.9%)
$38M (3.2%)
$251M (23.0%)
$386M (32.4%)
$47M (4.3%)
$71M (5.9%)
General Hospitals
$235M (21.5%)
$276M (23.2%)
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Figure 4: Change in mix of inpatient services – number of beds

Text equivalent below for Figure 4: Change in mix of inpatient services – number of beds

Text version of Figure 4

YearSeparate Psychiatric HospitalsGeneral Hospitals
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Figure 5: Sources of funds for increased spending on non institutional services in

Text equivalent below for Figure 5: Sources of funds for increased spending on non institutional services in

Estimated $215.5 million growth in annual spending on non institutional services since 1992-93

Text version of Figure 5

Sources of funds for increased spending on non institutional services:
  • Savings from reductions in institutions - $118.3M (55%)
  • New State and Territory Government funds - $50.5M (23%)
  • National Strategy 'Reform and Incentive' funds - $46.8M (22%)


1 Source data for this section has been taken from information provided to the Commonwealth by States and Territories for the 1996 National Mental Health Report

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