The AIDH isn’t being hogtied and beaten by LinkedIn or the Digital Health Festival, as a lot of people seem to think. It’s being starved by the government and agencies that say workforce capability is their top priority.
Anja Nikolic’s departure from the Australasian Institute of Digital Health will be explained away as a well-earned break.
The corridor gossip has its own version: the Digital Health Festival is eating the institute’s lunch, and LinkedIn is doing the networking members used to pay for.
The real story is that the Department of Health, Disability and Ageing and the Australian Digital Health Agency have stopped funding the one organisation doing serious, practical work on the digital and AI capability of the health workforce, just as that capability starts to matter most.
Ms Nikolic, who leaves in February, is one of the sharpest strategic thinkers the sector has produced. She understands digital health better than any AIDH chief before her, and better than plenty in government. The government should be worried.
What Nikolic walked into
Ms Nikolic arrived in March 2024 at the tail end of a financial mess. In the year to April 2024 the institute hosted MedInfo 2023 in Sydney for the International Medical Informatics Association. Revenue jumped by almost $1.9 million to $5.9 million.
The institute still went backwards. Its operating deficit widened from $419,000 to $719,000, and members’ funds went negative. So the group ran the biggest event in its history, hit its peak revenue and managed to achieve its largest loss.
It did all this at a bad time for the changing dynamics of the digital health sector.
Nikolic’s first job was to stop the bleeding, which she did with a lot of rigorous and strategic cost management over her three years. Its 2025-26 result is a loss of only $54,000, and it is forecasting a profit next year.
The DHF is a factor, not the cause
The Digital Health Festival story is overstated, but the festival is a problem for the group along with other market trends running against member organisations these days.
Now owned by global event organiser Terrapinn and claiming more than 8000 attendees, it grew up in Melbourne, one of the cities that hosts the institute’s flagship HIC conference. Previous leadership should have seen it coming. HIC’s delegate numbers and income from events have barely moved in a decade, partly due to this event.
But HIC is one event. The institute’s AI.Care conference is doing well, and its CHIA credential carries real weight.
Events and LinkedIn are not what will sink the AIDH.
The money that vanished
Government is what can sink it.
Two years ago the institute was getting about $900,000 in government and agency funding. This year it was about $350,000. Next year, on its own forecasts, it will be nothing.
Two streams have dried up. The first is the Australian Digital Health Agency’s National Digital Health Capability Action Plan, on which the institute has been a key delivery partner. It built foundational courses in digital health, AI and change management, and helped produce a readiness self-assessment tool for health organisations.
The second is the health department’s Health Peak and Advisory Bodies Program. The program exists precisely so peak groups can give government expert, independent advice without leaning on commercial or vested-interest money.
In 2021 it funded 23 organisations. For 2026-30 only 12 of 138 applicants made the cut, and the AIDH was one of the currently funded groups that missed out.
That is a program designed for exactly what the AIDH does. And without seeing all 30 applicants it’s hard to see the logic in why you’d cut the AIDH given just how vital health workforce capability is to a system that is moving towards a workforce catastrophe that is plain to see in our existing demographics profile.
It’s not likely Ms Nikolic gave any of this money up without a fight. She’s tenacious.
But when the agency’s budgets are overspent and the department of health is looking for savings workforce capability turns out to be an easy cut.
What has the government or the agency got to worry about if they make that cut?
It’s not as if David Pocock will bring it up in Senate estimates.
No one with positional power will complain, because workforce capability isn’t represented by anyone politically powerful. It’s ethereal. It’s OK to cut it because no one gets hurt.
Well, no one in government or the agency.
The harm to our healthcare system in the coming years, especially now that AI has landed on our shores like a nuclear strike, could be catastrophic.
The agency’s operating revenue is about $346 million a year, and it cut a few hundred thousand dollars of workforce work because doing so was painless.
What gives?
Related
The govt can’t be serious about workforce solutions
Every government digital health strategy calls workforce capability critical, and the rest of the investment depends on it.
The agency has obviously bet heavily on interoperability infrastructure and planning.
But if the people in wards, GP practices, pharmacies, aged care and allied health can’t use such infrastructure, the money will be largely wasted.
Our health workforce is nowhere near ready. Some frontline staff have never uploaded a note to My Health Record, and large parts of the system still run on paper.
AI capability isn’t knowing which button to push or how to write a prompt. It means understanding safety, governance, clinical risk and quality assurance.
Most of the workforce doesn’t have that, and there’s no cohesive plan to get it there.
The existing capability action plan developed with the AIDH is already dated and overdue for a rethink. It never really contemplated AI.
Nobody else does this work centrally. The medical colleges – ironically, most with regulatory moats protecting their membership revenue – might have digital health and AI in their strategic plans but there is nothing cohesive in their plans because it isn’t their core responsibility.
And LinkedIn and the festival don’t convene the people responsible for lifting workforce capability across the system into a cohesive think tank magically. Their role is important but supportive at best in the scheme of the problem.
The AIDH is the organisation with the track record and the capability to do the work.
Until this week, it also had the leader to do it.
What is the institute for?
Unlike the RACGP, the AIDH has no regulatory moat: nobody has to join to keep a designation or government mandated ability to practice.
It survives on merit while competing with LinkedIn for connection, with commercial organisers of events and media (us included to some degree) for exhibitors and sponsors and with the cost of living for members’ fees.
Without government support it can still run good events and a respected credential. What it can’t do is the independent policy work and system-wide capability programs that the agency and department say they want. This work was never going to pay for itself. It’s a public good, and it needs public money.
Who would take Nikolic’s job now?
Ms Nikolic’s successor hasn’t got an easy gig. They must get across the issues fast and rebuild government relationships on a shoestring, just as those relationships thin out on the government side.
The department has lost two of its most experienced digital health policy heads. Daniel McCabe, who ran the Medicare benefits and digital health division, has moved to health technology assessment reform, where he is dealing with pharma. Simon Cleverley, his long-time deputy in digital health, has gone to the new Australian Centre for Disease Control.
Both were long serving, both did good work and both carried a lot of the department’s corporate memory.
People move, and their replacements aren’t bad at their jobs. But they have very little background in digital health and policy.
The department losing its policy memory just as the peak body loses its most capable chief is the kind of disconnect nobody notices until the damage is done.
It could easily slow the whole sector for the next couple of years.
The fix isn’t that complicated
Find $400,000, a rounding error in the agency’s budget, and fund the institute to keep doing the capability work it was doing well. Tie the money to hard outcomes and refresh the action plan. If the agency can’t find that in $346 million, it isn’t trying.
Losing someone of Ms Nikolic’s calibre should be a wake-up call.
The government can’t afford to lose the institute as well.
Declaration of Interest: Health Services Daily has a contract with the AIDH to provide its members with subscriptions to its newsletter.