Duckett suggests that better funding and reforms in aged care and disability services could reduce hospital stays and costs, as residential care is often more effective and less expensive than hospital treatment.

Premiers and chief ministers are willing to collaborate on disability reforms but demand the federal government honor its commitments and act in good faith, warning that current proposals threaten healthcare quality and access.

Despite a $1.7 billion one-year funding boost earlier this year, negotiations for a five-year agreement continue, with states criticizing the federal government for not increasing its share and sidelining them in reform processes.

Over 1,200 patients are stranded in hospitals across Australia, a doubling over recent years, underscoring the urgent need for improved aged care and disability service capacity.

Disputes center on the removal of the 6.5% funding growth cap on hospital payments and rising costs driven by inflation, workforce shortages, patient complexity, and increased demand for aged and disability care, which are largely outside state control.

The government’s proposal to take over design of disability supports, move some autistic children to a new system called 'Thriving Kids' from 2027, and sideline states in NDIS reforms has caused major disagreements, with premiers arguing it undermines funding arrangements.

States are threatening to withhold support for a federal health funding deal and NDIS reforms unless the Albanese government increases hospital funding by billions of dollars, citing rising health costs and capacity issues.

A report by former federal Health Department head Stephen Duckett reveals that up to 10% of hospital bed days are occupied by patients waiting to transfer to aged care or disability facilities, highlighting a significant bottleneck.

Premier Chris Minns criticized the federal offer, asserting that negotiations are regressing and emphasizing the need for more federal funding to prevent emergency department overcrowding.

Health Minister Mark Butler remains optimistic, emphasizing ongoing efforts to improve health services through new clinics, subsidized medicines, and bulk billing initiatives, confident that negotiations will eventually lead to a deal.

The report indicates that health costs are increasing by 12% annually due to inflation, workforce shortages, and more complex patient needs, with states bearing over 75% of this growth.

Duckett urges both federal and state governments to make compromises, including improving hospital efficiency and increasing funding, to address systemic challenges.