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Is the future for NZ healthcare increasingly corporate?

18/04/16


Is the future for New Zealand healthcare increasingly corporate?

Talking to young healthcare practitioners and soon-to-be healthcare practitioners in New Zealand raises some interesting questions about the future of healthcare in our country.

To put the issue into context, let’s first take a look at the beliefs and values of Generation Y and Z. According to US research, both Gen Y (born between 1982 and 1994) and Gen Z (born between 1995 and 2012) are highly entrepreneurial. Some studies suggest that around 50% of Gen Y (AKA Millenials) want to run their own business. A recent US study stated that 71% of Gen Z would like to be business owners.

If these figures become anything near reality in the future, they represent a major change in our society. According to Statistics New Zealand, for example, only around 10% of Kiwis in the workforce are currently self-employed. If 60% of Generation Z were to be self-employed in 2050 for example, what would that mean for major employers?

But let’s change focus for a moment. Let’s narrow our view to only healthcare professionals in New Zealand. If 60% of Generation Z were to be self-employed healthcare practitioners in 2050, practices would typically be fairly small. Not such a major change in the healthcare industry.

Here’s where the story get’s interesting. Leicester Gouwland, Managing Director of William Buck Christmas Gouwland, an Auckland accounting firm, has been talking to young healthcare students and practitioners about their plans. In 2014 the firm surveyed dental students about their plans, and whether they intended to work on a salary, or to have their own practice at some stage. Leicester has followed up the survey recently with conversations with students and young practitioners in general medicine, dentistry and chiropractic.

The conversations have painted an interesting picture. Gen X healthcare practitioners echo the changing values of Gen X (born 1966-1981) vs. Baby Boomers (born 1945-1964). Gen X went into the workforce looking for more work/life balance than their parents. Ten hour days were not the typical aim.

Dr. Michelle Dickinson, Gen X owner of Kingsland Chiropractic, seems to speak for her generation of healthcare practitioners when she says “I saw owning my own practice not as a way to get rich and buy a mansion and a boat. To me, the idea was to create the freedom and flexibility to be able to have a family as well as provide long term financial security for my family.”

Dr. Hilary Strang, owner of Invercargill’s Toothworks dental practice is another Gen X practitioner who was focused on work/life balance. She says she always vaguely assumed she would have her own practice. Again, Hilary planned to have children, and wanted both flexibility, and an income while not working. She also aimed to have control over her future, and felt owning a business would be the way to gain control.

Once in practice, two things surprised Hilary. First, the level of challenge and time involved in running a business. Second, the attitude of the Gen Y dentists she hires on contract. None of them intend to own their own practice, ever. Now, Hilary wonders who will be interested in buying the practice when she is ready to exit the business.

A 4th Year medical student on the Gen Y/Z cusp who prefers to remain anonymous mentioned her belief that modern healthcare is more team based vs. the previous model of GPs typically working with their patients one on one. Her career preference is to begin work in a health hub setting, where there is more than one GP, along with physiotherapists, lab technicians, nurses, dentists and pharmacists. She believes working in a wider healthcare team improves patient care by maximising efficiency. This, rather than owning a practice, is her future focus.

Uddaka Wijesinghe is a Gen Y medical student. Born two years later, he would be Gen Z. His attitude seems to accurately reflect the values of the Gen Y/Z generation. Uddaka did not get into medicine with a plan to make a lot of money. His focus was on being able to provide excellent healthcare. He says his focus, and that of his classmates, is primarily clinical. He is trying to decide what he wants to specialise in. He dislikes the idea of low income earners not receiving excellent healthcare, and says he plans to work on a salary so that he can focus on helping patients rather than on business considerations.

It therefore appears that at least in New Zealand, Gen Y and Z healthcare students and practitioners are bucking their generational entrepreneurial trend. Their focus is on work/life balance, and a values-led attitude towards their chosen field.

This raises a question about the future of healthcare in New Zealand. The corporatisation of private healthcare is already underway. Groups such as Lumino the Dentists and White Cross Healthcare are expanding steadily.

Will the majority of healthcare practitioners be happy working for these groups in future? If so, will New Zealand eventually move from a healthcare system currently dominated by the equivalent of unique owner operated coffee shops to one mainly supplied by Starbucks and a handful of competitors? Would a corporatised system would be likely to mimic the behavior of the giant Health Maintenance Organisations in the US, and restrict choice and personalised care in order to increase profits?

Would the ironic outcome of more values-oriented young healthcare practitioners be a less values-oriented healthcare system?

Richard Keys is Chief Executive of Abano Healthcare, the parent company of Lumino the Dentists in New Zealand and Maven Dental Group in Australia, which combined have over 180 dental practices trans-Tasman. Unsurprisingly, he argues that “the corporate healthcare model, done correctly, provides the best of both worlds – best-in-class clinical care for patients and a values-based culture that treats everyone, from staff through to customers, as an individual.

Mr Keys continues “Our success is underpinned by a strong organisational culture where staff contributions are valued and there is a constant focus on clinical excellence. In addition, the size of our network means we can achieve economies and invest back into our organisation and people on a scale that would not be possible in an individual practice.

Keys goes on to suggest that as the “majority of graduating dentists are now females, a corporate providing flexible working arrangements is seen as an advantage for those wanting to have a family. Further, dentists are graduating with significant student loans so a corporate taking over all of the finances, administration and “back office” tasks is seen as a positive option with dentists able to focus on the work they enjoy and are trained for, rather than the operational role required in a dental practice.”

Leicester Gouwland concludes “it seems as though the future of healthcare in New Zealand will be increasingly corporate. Whether that is a good thing or a bad thing remains a matter of opinion.

ends

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