Emergency Departments (EDs) are the front door of the public hospital system and can be viewed as a safety net for the wider healthcare system. They are tasked with delivering timely, continuously accessible, high quality care. Now more than ever, government funded EDs are positioned in an environment of rising costs of health care and increasing scrutiny of quality, equity, efficiency and cost-effectiveness objectives. Given that the complex organisational structure of hospitals is replicated within EDs, governments need to design funding contracts that entice EDs to achieve these goals. There is, however, debate over whether financial incentives can achieve these objectives within the complex organisational structure of EDs. This thesis explores how an agency theory framework can be used to design hospital incentives. There is a specific focus on the advantages as well as the difficulties of using financial incentives to achieve desired objectives. The Queensland public hospital ED funding contract is used to examine whether or not inherent funding incentive influence the manner in which EDs operate and whether funding can be designed so as to entice them to achieve Queensland Health's organizational objectives. This is particularly apt given that there has been a change in funding from a historically based fixed budget model to a Casemix Funding Model (CFM). The CFM promotes technical efficiency, the seeing specific categories of patients within time and when required timely admission to inpatient wards. Additionally it has incentives to game via the upcoding of patients to a more severe triage category and by admitting patients to hospital who would not normally qualify. The analysis of Queensland's public hospitals ED data on the incentives to game the CFM indicates that EDs are not following the incentive to admit patients unnecessarily. However, there is evidence to suggest that the EDs are following the incentive to code patients into more urgent triage categories. This study finds that the new model- CFM- does not entice these EDs to achieve all of Queensland Health's organisational goals and furthermore that these goals cannot be achieved via financial incentives alone.