Health a done deal even without WA: Rudd

Prime Minister Kevin Rudd insists his health reform plan is a done deal - even if Western Australia refuses to buckle to demands to hand over its GST.

After two days of exhaustive negotiations, Mr Rudd on Tuesday trumpeted a "historic" health and hospital agreement with all states and territories except WA.

In return for $5.4 billion in sweeteners and an agreement by states and territories to hand back an unspecified amount of GST, the commonwealth will take control of 60 per cent of public hospital funding.

The GST grab is expected to be around one-third of revenues.

"This ... is a very, very big reform of the health and hospital system of Australia," Mr Rudd told reporters.

WA, however, could prove a headache for the prime minister.

The resources rich state wasn't seduced by Mr Rudd's cash splash.

"Twenty pieces of silver won't work with Western Australia and won't work with me," WA Premier Colin Barnett told Sky News.

Mr Rudd insists the deal won't fall over if WA doesn't sign up - though he is hopeful of reaching an agreement.

"We're pretty confident we can work something through with our friends in the west," Mr Rudd told reporters.

He later indicated the deal was valid with or without WA.

"This agreement between the Australian government and seven of the eight governments of Australia is valid in its own right," Mr Rudd told ABC TV.

"That's clear cut."

Mr Barnett wasn't so sure.

"I would think you need every state and territory to sign up to have a complete deal," he told reporters.

But it appears, one way or another, Mr Rudd will be relying on the goodwill of Liberals - from WA or the federal party - to get his agreement delivered.

Setting up the new health agreement requires three changes - amendments made to the Federal Financial Relations Act (FFR Act), changes to the intergovernmental agreement on federal financial relations (FFR IGA) and a new intergovernmental agreement on health.

Late on Tuesday, Mr Rudd's office released advice from the Department of Prime Minister and Cabinet that indicated any FFR IGA would be changed by all relevant parties and would "fairly reflect" WA's position.

"To give effect to the changes in the FFR IGA, changes to the FFR Act will be developed for introduction into parliament as appropriate," the advice said.

While the coalition hasn't decided whether it will support the necessary laws, Opposition Leader Tony Abbott didn't seem too impressed.

"Today there is no national agreement on health reform," he said in a statement.

"Western Australian has not signed up to the deal and it remains far from clear what has been agreed to by the other state and territory governments.

"Whatever deal has been done looks to be much more of a political fix than real reform for our hospitals."

Mr Rudd managed to get his "90 per cent" deal after winning over NSW and Victoria on Tuesday, the second day of a Council of Australian Governments (COAG) meeting.

Those two Labor states had been holding out with WA but caved in after Mr Rudd stumped up extra cash for more sub-acute beds and a range of other offers.

Mr Rudd had to make other concessions to the states and territories, including the creation of a new state-federal funding authority, which would distribute money from the commonwealth and states to local hospital networks.

Opposition health spokesman Peter Dutton told reporters Mr Rudd had simply created a "great big new bureaucracy".

"Another bureaucracy in health is not going to provide better patient outcomes," he said.

The federal government hasn't detailed how much its entire health and hospital reform program will cost or where it will get the money from.

That will come in the May 11 budget.