Department of Health

Policy and funding guidelines for health services

Policy and funding guidelines 

Relevant to organisations funded primarily pursuant to a Statement of Priorities

The Policy and funding guidelines represent the system-wide terms and conditions for government-funded healthcare organisations, such as health services and hospitals.

The guidelines:

  • reflect the Department of Health and Human Services’ role as the system steward
  • provide operational and service delivery policy changes, and outline contractual, statutory, and other duties and requirements
  • detail the budgetary landscape, including funding and pricing arrangements as well as funded activity and targets and
  • consist of the following two separate, although interconnected, publications.

COVID-19, State Budget delay, and the resulting impacts on the guidelines

The Victorian State Budget, typically released in May of each respective year, has been delayed until later this year due to the COVID-19 crisis. Consequently, the funding outcomes of the Victorian State Budget 2020-21 (the Budget) are not detailed in the Policy guide.

Several key items usually contained in the Policy guide, namely those sections requiring funding or Budget advice, including the Budget outcomes, will now be incorporated into the Funding rules. There are no other significant changes from the 2019-20 Policy guide. 

Once the Budget is released in late 2020, the Budget highlights, and the output and asset initiatives detailed in the Budget, will be incorporated into the Funding rules. 

The Funding rules will subsequently be developed and published. 

Policy guide

The Policy guide articulates detailed information on various operational and service delivery policy items, including the conditions within which funded organisations operate, as well as the obligations, standards and requirements funded organisations are expected to adhere to.

Part 1: Operational and service delivery policy

Not intended to be a complete, holistic guide to operational and service delivery policy in Victoria; Part 1 instead, provides an annual publication identifying and highlighting to health services the novel policy changes for a range of delivered services.

Part 2: Obligations, standards and requirements

Outlines relevant standards and obligations that funded organisations must adhere to, ensuring the delivery of safe, high-quality services and responsible financial management.


Funding rules

The Funding rules iterate the budgetary and funding parameters that funded organisations are expected to work to and within.

Part 1: Budgetary landscape and pricing arrangements

Details the budget highlights and outputs, and funding and pricing arrangements.

Part 2: Funding and activity levels

Provides funding and activity tables detailing the modelled budgets, as well as the targets for a range of programs across the health system.

The Funding rules will be published in due course.

Human services’ activities

Relevant to organisations funded primarily pursuant to a service agreement

The human services component of the Policy and funding guidelines has been replaced with the Service Agreement Requirements, which were effective 1 January 2020.

A service agreement is a legal contract between a government department and a funded organisation for delivery of services in the community on behalf of the department.

The service agreement provides the details about the parameters of the contract between the funded organisation and the department including:

  • Details of the parties to the service agreement
  • Services being delivered including the individual activities and relevant activity descriptions
  • Applicable departmental policies including the Service Agreement Requirements and program requirements
  • Funding summary and payment schedule
  • Agreement level information.

The Funded Agency Channel includes more information on the service agreement. Activity descriptions can be searched by using the Health and human service activity search

Other downloads

Reviewed 16 December 2021


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