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Hodgson: Healthcare Providers NZ speech

Tuesday 09 August 2005 Speech Notes

Healthcare Providers New Zealand speech

Keynote address to Healthcare Providers New Zealand conference, Sky City Function Centre, Auckland, Tuesday 9 August 2005, 10:30 am.

Thank you for the opportunity to address your conference today. It is your inaugural conference and it comes almost exactly five months after you were formed. I remember well the last time many of us met in the Grand Hall in Parliament.

That was an important occasion for me. I could see that this organisation was going to go places. It was going to develop capacity and it was going to be an important partner for Government well into the future.

Later in my remarks I have some gentle criticism to offer to your association, when we get into a bit more detail.

But, I am very keen to give you a very clear message that the Government's relationship with this organisation matters, to us. All good Governments build good relationships. It is a feature of modern society. Healthcare Providers NZ will, I hope, progressively develop abilities in research and analysis, in forecasting, in maintaining an understanding of the sector internationally, and in other areas such as standards development, work force issues, and in changes in the way healthcare is delivered.

Certainly, this conference is an excellent beginning. I would love to be a participant. I hope the perspectives on Australia or the Bay of Plenty were useful. I hope your voyage of discovery around InterRAI or Denmark will be useful.

The relationship between your organisation and mine will always have natural tensions in it. Money, compliance costs, contract inflexibility and so on. They are inevitable. But, they are also better managed in a strong relationship than a distant one. That's the case across the health portfolio, across the Government and, for that matter, across the modern world. A strong relationship works for the simple reason that perspectives can be easily swapped and shared. The time and energy invested in adversarial debate can be reduced. Not that there is anything inherently wrong with adversarial debate. I do it for a living. But sometimes things can become a bit ritualised and when they do progress inevitably slows.

In his letter of invitation your chief executive Martin suggested I might like to talk around three issues:

- The likely mix of homecare, resthome care and geriatric hospital care in the future

- Will residential care bed numbers go up or down?

- What type of services should residential care facilities be providing by 2011 and 2021?

I think they are very perceptive questions and I shall have a good go at answering them.

Before I do I had better quickly remind us all of the main statistical projections. They are all pretty self-evident, they are all pretty well known to you and I promise to avoid a blizzard of graphs or figures.

- People are living longer lives and life expectancy will move up a few more notches, especially for men and especially for Polynesians

- People are living healthier lives, and today's 75 year old is now fitter than yesterday's

- People are actively opting to stay in their own homes longer and enter rest homes later, or temporarily, or with higher acuity or not at all. The "not at all" is about 70 per cent of the population,and

- The baby boomers are coming, in a steady trickle from 2011, and in a flow from 2021.

There are many more, smaller statistical influences including immigration, regional differences, the prevalence of dementia and so on. And there are many other factors including technology shifts, pharmaceutical advances and different ways of delivery that will impact, even significantly. But the four main statistical trends are all demographic ones.

From those four trends some of the answers to Martin's questions begin to fall into place. The first one, the likely mix of homecare, rest home care and geriatric hospital care is of course already changing and will change more. The main societal shift is that people are staying in their own homes longer, because they want to and, increasingly, because they can.

Funding shifts demonstrate this change clearly. In the past six years funding for the aged residential care sector has gone up by about 30 per cent (including the budget in May), whereas funding for home based support services has nearly doubled.

Some commentators say that this trend of staying at home longer is now starting to mature. Others say that it still has a way to go. In either case, the trend hasn't yet slowed.

But the other half of the first question, the relative roles of residential care and geriatric hospital care, is less certain and more interesting. Right now, geriatric hospital beds and dementia beds are rising compared to that which we call rest home beds. But as the acuity of rest home residents rises the distinction between the two types of care is starting to blur. I think that distinction will continue to diminish and that we will see more and more hospital-like care in the less formal, more social setting of a rest home. If I have picked that trend accurately then there are implications for funding, standards, staffing skills and so on.

Your second question,"will residential care beds go up or down?" can also be examined using the four demographic trends. The numbers of people over 85 will quadruple by 2050, but by then the anticipated life expectancy will also have moved up and tomorrow's 85 year old may well be more sprightly on average than today's, especially when technology shifts are taken into account. The trend to stay in ones own home continues to play out and last of all there is that trend to higher acuity as rest home care moves closer towards hospital care. So, demography trends are balancing one another out all over the place.

Right now we have overbedding and underbedding, though neither to any serious extent and regional differences will continue to exist especially as some centres become attractive to retirees, such as Waikanae, parts of Tauranga, or Mosgiel, near where I live.

My best guess to your second question is both up and down. But the more important answer is that the role of rest homes will continue to change, which leads to your third question. What type of services should rest homes be providing by 2011 or 2021. My answer is, a much wider range and probably sooner than later. That is, by 2011 rather than 2021.

Let me expand. Rest homes have already started to offer short term accommodation either as respite care or for rehabilitation. A person goes to the rest home for a rest. Or, to give their carer a rest. That trend, I am sure, will continue. On the other hand the high acuity trend will also continue. I used the term before "hospital-like" care, because I can't think of a better one and I think this will particularly be the case with dementia as medication improves.

I also think that rest homes will participate more and more in the provision of day programmes and home support. And I see rest homes extending their functions to include more palliative care.

The market will be at play here. People choose rest homes carefully. Expectations have already risen and careful innovation will no doubt continue to be rewarded.

Reevedon, a Presbyterian Support Services home in Levin, will do as an example. Their approach is determinedly client centred.

Residents get up when it suits them, so bathrooms and dining rooms are used more flexibly. Clients are encouraged to organise their own weekend activities or to help with gardening. Staff training includes an exploration of abstract principles such as privacy, institutionalisation, quality of life and so on. These more relaxed routines seem, as a bonus, to reduce stress for those with dementia.

So, that I hope is an honest go at your three questions.

Now to money. I said earlier that aged residential funding had increased by about 30 per cent in the past six years, but that does not of course mean a 30 per cent increase in price for two main reasons. One is volume changes, though these are not huge. The other is that when price does rise the funding must pay for the publicly funded resident as well as the top up for the privately funded resident.

There is no doubt that rest homes have been under financial stress and I acknowledge it freely. Indeed, the Prime Minister gave voice to her concerns when she opened Parliament. In the course of the past twelve months the Government allocated $16 million then $71 million more to the sector, some of which is back-dated. The increase over two years is almost exactly 20 per cent, and the funding baseline has moved from $450 million per year to $540 million.

Almost instantly arguments broke out about how much of that would be passed through, to whom, for what, by DHBs. Those arguments continue, often it seems in the media. This is a debate over funding increases by the Government versus expenditure increases by DHBs. I simply ask both parties to deal with one another in good faith. I understand the first meeting was yesterday.

Now, to my gentle criticism. It's about the campaign you launched last week with billboards and website and press statements. It's election time. You want to be heard and heeded, and I'm just fine with that.

My criticism is two-fold. The first is your bald statement that "the Government has chosen to ignore the elderly." The government has chosen no such thing.
That's the sort of jingoism I would expect from our political opponents, not from an organisation that sees itself as a serious player.

The second is about quantum of money. I think it is just a mistake. You assert both that the funding gap is 20 per cent, and that $197 million is needed to address it. This $197 million represents not a 20 per cent increase, but a 36 per cent increase.

In any case, we are right now trying to size any gap in funding. You will know of the Government's study into the long-term sustainability of the sector, including funding sustainability, due for completion in November. That study arose from the working group report on which some of you will have served, thank you, itself the child of the Health of Older People Forum, or HOOP, which my predecessor Ruth Dyson established. Also in the mix was the research-based quality and safety project.

Not much has come my way on this study yet, but it will. We discussed it at the last HOOP meeting last week, and I am keen after all these forums and working party reports to leave officials alone for a while to get on with their job. All of us will want a look at their work after the election

I want to make a few other observations, then conclude.

I think InterRai is an important development and from what I've seen of it, it seems to be a reliable and sensible assessment tool. I am very keen to see it trialled and tested and I hope rolled out across the country. I hope you find the presentation of value.

Workforce issues are significant. There are issues of pay, conditions, staff turnover and training and they are all linked. They are well documented in the research undertaken at the start of the quality and safety programme and they are issues that you will understand well. They are problems that are exacerbated by a tight labour market and, for registered nursing staff, by the recent DHB nurses agreement.

The issues of pay and conditions, pay especially, can be addressed somewhat from the increased funding that you are now in negotiation over. That, by itself, will help to an extent.

But increased training will help too, especially at the foundation level. We have decided to add some effort of our own to the training that your members already undertake or contribute too. Our interest is to start plugging any gaps. We suspect the gaps are more likely to be found at the foundation course part of the spectrum and are more likely to be found at the home based support services end than at the aged residential care end.

We have allotted a small amount of money, $5 million from the Disabilities Services Directorate, to get started. We are assuming that training infrastructure gaps will also be found. In any case, as we develop our proposals we will test them with people like yourselves. In fact, I also see this as an opportunity for Healthcare Providers to use its nascent research and development capacity to explore the factors and motivations of the workforce, with a view to finding innovative solutions. I look forward to working with you on that.

But I think the thing that consumes Government and DHBs the most is this idea of a continuum of care. I suspect the industry is paying more and more attention to it as well. The continuum of care idea, like most jargon words, has a number of threads to it. But I see two main threads.

First, a rejection of the idea of inexorable decline as people age, and instead, an emphasis on rehabilitation. Older people get better. Dementia can abate. Mobility can improve. Confidence can return. Services that are geared toward rehabilitation will grow.

The second thread is the development and delivery of services that are more integrated or joined up. Primary health with home-based care. Closer rest home and hospital care linkages and so on. The scene in DHB land, just now, is very active and somewhat confused. New approaches are the norm, as I am sure you saw with the Bay of Plenty presentation.

Here comes the conclusion. It is the same as the introduction. Good Governments have strong relationships with many groups of stakeholders, be it the PSA, local government, the chamber of commerce and endless others. All of these relationships thrive on the discussion of differences and a discussion of future direction. That is why they exist.

That is why I think the formation of this body, just five months ago, matters. I therefore wish you well.


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