Tasmania's health system is underfunded "in excess of $90 million a year" and the situation is only going to get worse, a secret report compiled for the state's health service has found.

Opposition Leader Rebecca White said the Government had been lying. ( ABC News: James Dunlevie )

The system has been under intense pressure, with a 2017 Upper House inquiry into acute health finding the system's leadership systems are flawed, crowded emergency departments are putting patients at risk and those with mental illness are receiving inadequate care.

A week before that probe, a Deloitte report found decision making in the Tasmanian Health Service was crippled by poor governance, prompting the Government to announce an overhaul which included removing the executive.

Today's leaking of the report by RDME Consulting found demand for health services had grown by 3 to 6 per cent over the past few years and in the years ahead — from 2017/18 to 2020/21 — is likely to be around 3 to 4 per cent.

Using data from an earlier KPMG assessment, the report found health budget funding had only increased by 1.7 per cent per year.

"It is highly likely that there exists a significant and growing structural deficit in THS funding," the report found.

"The KPMG report estimates this structural deficit is in excess of $90 million."

Modelling on the future demands on the emergency department was set aside by Treasury, the report found. ( ABC News )

KPMG noted the annual increase in the THS budget was largely for new projects so it did not address that shortfall.

The report's authors said a systemic analysis of demand "is hampered by the lack of clinical service planning across the DHSS and THS", with the last plan developed in 2007.

It also found budget management was being hampered by a focus on reducing full-time equivalent staff numbers.

"Persistent deficits in the THS ... have resulted in ad-hoc attempts at intra-year cost reduction with an over-reliance on reduction in head count as a saving strategy."

Forecast demand on ED 'ignored'

It also singled out the increasing pressure being placed on the emergency department, which recently made headlines because patients were waiting so long they were forced to make beds on the floor with towels and sheets.

"The pressure is the result of ignoring or discounting demand projecting," it found.

Modelling was done in 2006 to prepare for Royal Hobart's Emergency Department, but the report noted Treasury was sceptical about the demand projections and believed there were artefacts of the model that "would not occur in real life".

The refurbished emergency department, which opened in 2017 was built to deal with 45,000 presentations a year. It is now dealing with almost 62,000 presentations a year.

The report looked at Commonwealth Grants Commission data and found that although GST receipts had increased, health spending had not.

Tasmania has the lowest health funding as a proportion of GST receipts than any other state.

One of the photos supplied to the ABC of people waiting for treatment at Royal Hobart Hospital. ( Supplied: Patient B )

Opposition Leader Rebecca White told ABC Hobart the contents of the report "demonstrates the Government have been lying about the health system for the previous term".

"For the four years they were in government, we argued they were chronically underfunding health and they denied that.

"It's been proven that we were right and they were wrong."

Ms White said Health Minister Michael Ferguson had cut jobs and services "at a time when our health system is under a huge amount of pressure and staff in the system are doing their very best and struggling without the appropriate resources".

"The Minister ... needs to explain of that new money he's allocated to the health budget, how much is for new initiatives or how much is for plugging the black hole?"

Health Minister Michael Ferguson and Treasurer Peter Gutwein have rejected the report's assertions. ( ABC News: Fiona Blackwood )

Minister rejects 'personal politics'

At a press conference this morning, Mr Ferguson said the Liberals had employed 630 hospital staff since being elected in 2014.

"We opened 120 beds, that's our history and our plan is now being put in place," he said.

"As recently as June this year we budgeted $465 million more for the health system. Since that report was presented to government we've put on 200 more staff.

"We are not accepting the negative, relentless personal politics surrounding this."

Treasurer Peter Gutwein said he did not accept the report's assertions because it looked at the percentage of GST revenue being spent on health, rather than overall revenue.

"Some states have only 8 per cent of their revenue generated by the GST and we have significantly more," he said.

"A measure that should be utilised is look at the overall spending in terms of revenue on health and [by that measure] Tasmania is in the top two."

RDME Consulting principal Rhys Edwards was secretary of the Tasmanian Department of Premier and Cabinet from June 2008 to March 2014 under Labor leaders David Bartlett and Lara Giddings.

Government's use of GST questioned

Australian Medical Association Tasmania president Dr John Davis questioned the Government's budget surplus of $160 million in light of the health funding shortfall.

"I suspect if we were funding the health budget correctly we would not have a surplus," he said.

"It's a big problem for the Tasmanian Government but it's a problem that affects all Tasmanians because our health system is being underfunded."

Emily Shepherd from the Australian Nursing and Midwifery Federation (ANMF) said frontline staff felt the pressure of the funding shortfall.

"We are raising solutions to ongoing challenges around bed block, lack of capacity and a significant overcrowding in the emergency department. Any of those solutions that potentially will incur a significant cost have not been supported by the THS executive and clearly not by the Tasmanian Government," she said.

Tim Jacobson from the Health and Community Services Union said Tasmania was getting more from the GST Grants Commission than any other state to address Tasmania's health needs.

"But this state government isn't spending it on these issues — it is spending it elsewhere and we've got demand rising," he said.