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Message to Auckland DHB from Hospital Specialists

20 March 2014

‘Please Explain’ Message to Auckland DHB from Hospital Specialists

The chief executive of the district health board responsible for the country’s biggest public hospital needs to come clean about any intentions to cut medical staffing costs, says ASMS Executive Director Ian Powell.

“We’re extremely concerned by an email from Auckland District Health Board Chief Executive Ailsa Claire to senior managers and clinical leaders which strongly suggests drastic cost-cutting and job losses are being considered,” says Mr Powell.

“We know DHBs are struggling to make ends meet with the funding available to them, exacerbated by the Government’s expectation that they excessively focus on achieving national health targets. The Government needs to take responsibility for the situation DHBs like Auckland find themselves in, as there are broader issues here about the level of health care funding and investment in the health workforce.

“However, cutting costs for short-term financial relief at the expense of quality health care or the front line clinical workforce is absolutely not the answer.”

“The workload for hospital specialists only ever increases. Already the government and DHBs generally are ignoring the fact that entrenched specialist shortages have become the norm in public hospitals. Actions such as not filling specialist or nursing vacancies, for example, will add to the stresses faced by the overstretched specialist workforce. This can only be bad for the standard of patient care.”

The email talks of reducing overall costs within the DHB and focuses on the costs of specific services, including theatre, children’s and old persons’ services, and a range of surgical services, respiratory medicine and intensive care. It says the DHB needs to move from talking about reducing staffing costs to ‘actually doing it now’ and refers to the need to ‘take posts out or and have a major process redesign’.

Mr Powell says Ailsa Claire needs to explain what she is planning and why, the options being considered, and the potential impact on services and the clinical workforce.

“The language used in the email makes it clear the Chief Executive is planning measures which could have a big impact on hospital specialists,” he says.

“It is also disappointing that in response to the public release of the Chief Executive’s email Auckland DHB has issued a media statement suggesting that it is no big deal. But in her email she said the situation was ‘financially unsustainable’. In her email she also said: ‘Gilbert we need to action a coms plan on this urgently’. Her media statement is the ‘coms plan’.
“The only decisions that should be made are those that make good clinical sense. Unfortunately there is an absence of clinical sense in the Chief Executive’s email,” concluded Mr Powell.

Ailsa Claire email to senior managers and clinical leaders
From: "Ailsa Claire (ADHB)"
Date: 5 March 2014 9:29:20 am NZDT
Subject: Financial

We have a problem. The good news is the summer plan has helped but the current year is financially unsustainable with an underlying deficit of 12million all of which we can not cover from opportunistic saving in the funder.

The consequences of failure to balance this year will be just as bad as a failure to provide a balanced plan for next year. We are in danger of the Board or and external people determining how we resolve this issue. Not good for the organisation.

To both get non recurrent savings and to make a start on next years savings we need to move from talking about reducing the staffing costs to actually doing it now. We are having a lot of discussions but need to move from thinking about it to action.This is going to be hard.
It's clear that we haven't convinced the organisation there is a problem or that they can help solve it. The conversations about protecting jobs by reducing costs needs to be had. Gilbert we need to action a coms plan on this urgently.

We are setting up the overarching group as agreed to try to get focus and pull together the different streams of work on staff costs. This group will also handle the external negotiations that need to take place and the staff side processes.

Can you go through with your team, I understand the next week finance and HR staff are all in place together with the innovation and decision support people, the table which shows the potential areas of cost reduction which Viv sent you. Basically we need you to start to action this and identify where additional support or information is required and come up with a plan you can both immediately action and action in the short term. We can use the leadership meetings to pick up what every one is doing and the HR team to share best practice, ideas and quick wins.

The costs perhead will have to be reduced overall.

Organisationally however there are areas where a significant change plan needs to happen quickly, which will probably need to take posts out or and have a major process redesign. These are theatre costs, children's, older persons and services were we make significant loss.

These are cardiothorasic surgery, vascular surgery,general surgery,gynaecology,neurosurgery, orthopaedic surgery,respiratory medicine, and intensive care.

There is obviously overlap between these.reducing theatre costs overall will impact on all the surgery as will looking at specific medical staffing costs but it looks as if these might be the areas where specific change processes need to be put in place.

Ailsa Claire


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