PHOs reach out to 1.7 million New Zealanders
July 1, 2003
Primary Health Organisations reach out to 1.7 million New Zealanders
Health Minister Annette King said today the enrolment of 1.7 million New Zealanders in Primary Health Organisations after just one year surpassed all her expectations.
Prime Minister Helen Clark and Ms King today visited the Newtown Union Health Service to announce the formation of 13 more PHOs, bringing the total to 47.
Ms King said: “I would have been pleased if the Government had achieved its hope of 300,000 New Zealanders enrolled in PHOs in the first year, but we have 1.7 million New Zealanders in PHOs already. None of us expected to get this far in just one year.”
Describing the growth rate of PHOs since they began on July 1 last year as a real success story, Ms King said more than 800,000 of the New Zealanders enrolled were now paying no more than $20 to visit the PHO.
“But PHOs
are doing a lot more than just saving money for patients.
They are reaching out to people by providing a range of
primary health care services such as immunisation, child and
women’s health, sexual health services, and programmes to
manage diabetes and reduce heart disease.”
Ms King said
the Government is spending more than $400 million over three
years on implementing the primary health care strategy, with
$50 million allocated in 2002-03, $165 million this year,
and $195 million next year.
“I cannot imagine a more valuable area for the Government to spend health dollars than primary health care. Improving early access to health care and removing inequalities is absolutely crucial if we are to make a real difference to the health of New Zealanders,” said Ms King.
“PHOs offer us our best chance yet to improve health. The logic is obvious. At present about 30 percent of hospital admissions for those aged under 75 are avoidable. Two thirds of these, or more than 60,000 hospital admissions, can be avoided through earlier access to effective primary health care.”
Ms King said the establishment of 13 new PHOs meant there were now only five of the 21 District Health Boards (DHBs) without a PHO in their region, and she expected all DHBs to have PHOs within the next six months.
Out of the 47 PHOs, 32 are funded under the ‘access’ formula, which targets high health need, low socio-economic areas, seven are funded under the ‘interim’ formula, and eight are ‘mixed’, (‘interim’ PHOs with some practices in the area that qualify for ‘access’ funding).
Ms King said from October 2003 all PHOs would be funded to charge low fees for all patients under 18 and the Government intended to roll-out low cost health care for people aged over 65 from 2005–06.
“A new ‘Care Plus’ initiative, to provide low cost health care for many older people with very poor health as well as others requiring high levels of care, is also being piloted this year and is expected to roll-out in all PHOs from January,” Ms King said.
“One thing all PHOs have in common is that they will focus their energies on keeping their enrolled populations as well as possible for as long as possible. There has been an incredible amount of hard work in the past year, with magnificent and enthusiastic support from many health professionals.”
Primary Health Organisations
beginning July 1, 2003 DHB
PHO PHO Type DHB Number
enrolled
Primary Health Network for Central
Auckland Interim Auckland 223,362
Auckland
PHO Interim Auckland 27,357
East Health Services
Limited Interim Counties Manukau 29,023
Coast to
Coast PHO Interim Waitemata 9,742
Taumata Hauora
Trust PHO Access Whanganui 5,991
Whanganui
Regional PHO Mixed Whanganui 56,516
Tararua
PHO Interim MidCentral 15,431
Canterbury
Community PHO Access Canterbury 5,369
Kapiti
PHO Mixed Capital and Coast 33,189
Capital
PHO Interim Capital and Coast 122,396
Pinnacle
Taranaki PHO Access Taranaki 5,261
Te Korowai
Hauora o Hauraki Access Waikato 8,018
Manaia
Health PHO Access Northland 73,377
Questions and Answers
What is primary health care?
Primary health
care covers a broad range of out-of-hospital services,
although not all of them are Government funded. It aims to
improve the health of the people in communities by working
with them through health improvement and preventative
services, such as health education and counselling, disease
prevention and screening.
Primary health care includes first level services such as general practice services, mobile nursing services and community health services targeted especially for certain conditions, for example maternity, family planning and sexual health services, mental health services and dentistry, or those using particular therapies such as physiotherapy, chiropractic and osteopathy services. Chronic diseases, such as diabetes are best managed by primary health care services so that complications can be prevented or mitigated.
What is the
Primary Health Care Strategy?
The Primary Health Care
Strategy was launched in February 2001 by Health Minister
Annette King. It builds on the population health focus and
the objectives of the New Zealand Health Strategy and the
New Zealand Disability Strategy and outlines how a different
approach to primary health care will improve the health of
all New Zealanders through: a greater emphasis on population
health, health promotion and preventative care; community
involvement; involving a range of professionals and
encouraging multidisciplinary approaches to decision-making
improving accessibility, affordability and
appropriateness of services;
improving co-ordination and
continuity of care; providing and funding services according
to the population’s needs as opposed to fee for services
when people are unwell.
What is a Primary Health
Organisation (PHO)?
PHOs are the local provider
organisations through which District Health Boards (DHBs)
will implement the Primary Health Care Strategy. The
essential features of PHOs are set out in the Minimum
Requirements released by the Health Minister in November
2001:
PHOs will aim to improve and maintain the
health of their populations and restore people's health when
they are unwell. They will provide at least a minimum set of
essential population-based and personal first-line general
practice services
PHOs will be required to work
with those groups in their populations (for example,
Māori, Pacific and lower income groups) that have poor
health or are missing out on services to address their
needs
PHOs must demonstrate that they are
working with other providers within their regions to ensure
that services are co-ordinated around the needs of their
enrolled populations
PHOs will receive most of
their funding through a population needs-based formula
(capitation)
PHOs will enrol people through
primary providers using consistent standards and
rules
PHOs must demonstrate that their
communities, iwi and consumers are involved in their
governing processes and that the PHO is responsive to its
community
PHOs must demonstrate how all their
providers and practitioners can influence the organisation's
decision-making
PHOs are to be not-for-profit
bodies with full and open accountability for the use of
public funds and the quality and effectiveness of
services.
What is the Government's high-level direction
for the Primary Health Care Strategy?
The agreed
high-level direction is as follows:
Subject to
the availability of funding, the public share of primary
health care funding will be substantially increased over the
next 8-10 years
Over time, as PHOs are formed,
they will be funded according to the needs of their enrolled
populations to provide more effective and affordable care
with a population health focus
As this happens,
reliance on the Community Services Card (CSC) will be
progressively reduced
As the CSC will still be
needed for a number of years, measures will be implemented
to improve its take-up in the meantime.
What funding is
available for the Primary Health Care Strategy?
The
Government has committed just over $400 million over three
years to begin implementing the Primary Health Care
Strategy.
Where has the new funding been directed?
The Government’s priorities for the new primary health
care funding (in order of priority) are:
1. High needs
populations: Extra funding will be made available to PHOs
covering very deprived populations in order for them to have
low fees for all their patients, provide services to ensure
care gets to where it is most needed, include services to
improve and maintain health as well as restore health, and
to move to fairer funding allocations on a population needs
basis.
2. Adjust subsidy for children under 6: The
General Medical Services subsidy for children under six
years was adjusted in July for inflation since 1997.
3.
Progressively lower cost of access to primary health care:
As more funding becomes available from 2003/04, it will
start to be applied to extend free or low cost access to
primary health care services through PHOs. The priorities
will be reducing costs for school-age children and
individuals with high health needs participating in Care
Plus.
4. Sustainable rural services: Measures have been
introduced to help implement the Primary Health Care
Strategy in rural areas and to retain and recruit the rural
health care workforce. This represents a $32 million
commitment over three years.
5. PHOs across the country:
Primary Health Organisations are being encouraged to set up
across the country; they will be funded according to their
enrolled population to provide a range of population based
services to improve and maintain health as well as treatment
services; and to address health inequalities.
6.
Improvements to CSC and HUHC: A range of measures will be
introduced to improve take-up of Community Services Cards
until such time as increased funding means cards are no
longer needed. Improvements to the High User Health Card
will also be implemented.
7. Pharmacy co-payments: From
October 1 2003 prescription fees will be reduced to a
maximum of $3 for children aged between six and 17 enrolled
in interim PHOs, and for patients of all ages enrolled in
Access PHOs.
8. Adjustment to retain value: From July 1
2003 all PHO capitation rates will be increased by 2.52
percent in line with the Government’s commitment to retain
the value of the contract.
9. Nursing workforce
development: Primary Health Care nursing scholarships have
been established to assist nurses working in the primary
sector to gain post-graduate qualifications. About 180
nurses were allocated scholarships earlier this year, with a
second round of scholarships occurring later in the year. In
another nursing initiative, eleven primary health care
innovative models were selected from more than 130
proposals. Nearly half of the models, aimed at reducing
fragmentation and duplication of nursing services, have
already been implemented.
How are PHOs being established?
A small amount has been made available to help PHOs to
get established, particularly small ones.
What will
happen to the Community Services Card?
The Community
Services Card will be phased out over the next 8-10 years.
As it will still be needed by many people over the medium
term, improvements will be made to make it more effective.
Improvements will include measures to:
Increase
the numbers of people who get the card automatically rather
than having to apply
Simplifying the process for
low-income people to gain a card
Making it
easier for providers to determine whether an individual has
a card.
What initiatives are planned or underway to
improve the take-up of the CSC?
They include a greater
promotion of the card, via Maori and Pacific Island
networks, as well as employer and union representatives,
streamlining the application process and greater automation
of assessment of entitlement. The Ministry of Health is also
continuing to fund a free telephone service for providers to
verify patients' card status.
What about changes to
General Medical Services subsidy (GMS)?
From October this
year, all under 18s in all PHOs will receive low cost health
care.
How are PHOs different from Independent Practitioner
Associations?
PHOs must meet a set of minimum
requirements that do not apply to IPAs. Many IPAs would
already meet some of these requirements but few would meet
all of them at this stage. Several IPAs are considering
making the changes necessary to become a PHO while others
are supporting the establishment of PHOs locally. PHOs are
also expected to develop as multi-disciplinary teams (eg
doctors, nurses, Plunket, pharmacists, etc).
When did the
first PHOs begin operating?
TaPasefika Health Trust and
Te Kupenga O Hoturoa, in the Counties Manukau District
Health Board (DHB) region, were established in July
2002.
How many PHOs are up and running?
From today, 47
PHOs have been established, covering a population of
approximately 1.7 million New Zealanders.
What are the
formulae that have been developed to fund PHOs?
There are
two: Access and Interim.
How will the Access formula
work?
It will allow all those enrolled with an Access PHO
to be charged low patient fees, or access free care, and
there will be no need to use CSCs. In the first instance,
the Access formula will be available only for PHOs (or
practices/clinics within PHOs) serving populations with high
concentrations of NZ Deprivation Decile 9/10 and individuals
with high health needs.
What about the Interim
formula?
Until there is enough funding for all PHOs to be
on the Access formula, an Interim formula will apply to
other PHOs/practices. The Interim formula will continue to
use CSC status both for determining funding and setting
patient fees. It includes additional funding for a range of
new functions such as health promotion and extra services to
improve access for high-need groups.
Over time, as funding allows, the per capita amounts in the Interim formula will be increased towards the levels in the Access formula. This will start in 2003/04 with increases for all school-age children, and for individuals with high needs.
What are the key factors of the two formulae?
Both the
Access and Interim Formulae recognise ethnicity and
deprivation, alongside age and sex, as key determinants of
population need, and both provide increased funding for
HUHC-holders. Weightings for ethnicity and deprivation will
target extra funding to improve access for high need
populations through services such as clinics on marae or
employing community health workers. PHOs will need to
satisfy their DHB on how the extra access funding will be
used.
What alternative funding approaches have been
proposed and why?
Following concerns expressed by some
GP groups two PHOs are trialling an add-on to the Interim
formula that will give extra funding for people with high
health needs. Called ‘Care Plus’, this will provide low cost
access for people with high needs until Access funding
levels are available throughout New Zealand.
The key
criterion is likely to be that the person is expected to
need at least two hours of clinical contact time in the
coming six months. This need for care might be indicated in
a number of different ways including that the person
is:
Suffering from two or more chronic
illnesses
Has a track record of heavy
utilisation of primary care (six visits in the past six
months to primary care or an Emergency
Department)
Has a track record of acute hospital
admissions (two non-surgical acute admissions in the past
year)
Has a terminal illness.
About six
percent of the population will come into this
category.
All 'Care Plus’ patients will have a care plan
developed for them, including quarterly reviews to check on
health status, treatment, medications and so on. The care
will be able to be delivered flexibly, using GPs and other
members of the PHO team. Capitated funding will facilitate
that.
How much will it cost New Zealanders to visit
PHOs?
All people enrolled with ‘Access’ PHOs will have
low patient fees. Although charges will vary, many Access
PHOs may be able to offer free care for children under six.
School-age children will be charged less than $10 while most
adults will pay in the order of $10-$15. Each Access PHO
will agree maximum patient fees with its DHB. In 2003-04,
patient fees for under-18s will start to be reduced for
people enrolled with PHOs funded under the Interim
formula.