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Primary Health Organisation (PHO) enrolment report

Media Release

6 October 2003

Primary Health Organisation (PHO) enrolment report released

The Ministry of Health today released a report with 33 recommendations aimed at improving enrolment processes for Primary Health Organisations (PHOs).

The Counties Manukau Enrolment and Capitation Based Funding (CBF) Process Improvement Project Report is the product of three months' intensive work by PHO, district health board (DHB) and Ministry representatives.

The project was established by the Ministry after an earlier review into the higher than expected number of people enrolling in more than one PHO in the Counties Manukau DHB region.

Ministry spokesman Dr Jim Primrose said today that the project went beyond just presenting the symptoms of the problems to examine the root causes as well. ``The collaborative approach taken by the project steering group was invaluable, resulting in a report that focuses on finding solutions,'' he said.

``We now have 33 recommendations, some that can be implemented in Counties Manukau immediately, but many with national implications.

``The steering group has identified six priority recommendations that are already being implemented. Ten of the recommendations will need national consultation. Implementation will depend on the outcome of this and may take up to 12 months.

``In the meantime, we've come up with ways to help PHOs that are having problems. This includes a 12-month `funding floor' initiative for Access-funded PHOs and Access practices that have experienced financial hardship since becoming part of a PHO.

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``We have also capped the number of fee for service deductions that can be claimed against a practice to three consultations a month.''

Dr Primrose said the report recommended how to improve the enrolment process for PHOs working in a capitated environment, ``and we'll be moving as quickly as we can to do this''.

``The report identified a real need to raise the level of public and provider understanding of the population-based primary health care changes that are taking place. And it also focused on areas for improvement around enrolment rules and IT.''

Enrolment with a PHO means that someone has chosen to use that PHO for most of their ongoing health care needs. People can be enrolled with only one PHO, which is then responsible for co-ordinating the care of its enrollees.

The national average for duplicate enrolments in the July 2003 quarter was 8.6 percent. At 13.6 percent, the duplicates rate in Counties Manukau was the highest in the country, with the lowest at 1.6 percent on the West Coast.

This has caused problems because PHOs get Government funding based on the number of people enrolled and their demographic characteristics.

``Undoubtedly there are significant questions around what is happening in the South Auckland environment, where we know there is poor health status and a mobile population,'' Dr Primrose said.

``This project has thrown a spotlight on an historic pattern of accessing health services that hasn't promoted good health in the past. But if we're going to improve and prevent ill health in places like South Auckland, we need to look at the sorts of changes that will do this.

``There is plenty of international evidence that emphasises the importance of continuity of care in a primary care environment. Enrolment in a PHO is a platform upon which continuity of care can occur.''

Dr Primrose said the PHO experience in Counties Manukau was not typical of the whole country. In the July 2003 quarter, 14 DHBs had duplicate enrolment rates that were less than the national average.

``There are some unique challenges in South Auckland and it is up to everyone - the DHB, providers, community and the Ministry - to come up with innovative solutions.''

Dr Primrose noted that the Counties Manukau report validated the findings of the Ministry's HealthPAC Audit & Compliance review earlier this year.

There are 53 PHOs around the country, eight of which are in the Counties Manukau DHB region.

To view The Counties Manukau Enrolment and Capitation Based Funding (CBF) Process Improvement Project Report, go to www.moh.govt.nz/primaryhealthcare

For more information contact: Chris Mules Chief planning & funding officer Counties Manukau DHB (09) 262 9505 (025) 354 425


Marama Ellis Media advisor Ministry of Health (04) 496-2067 (021) 802 622

Questions and Answers: What is a PHO? A Primary Health Organisation (PHO) is a group of doctors, nurses and people trained and skilled in health care who are working together to provide a better health service for people enrolled with them.

What does enrolment with a PHO mean? · It means signing an enrolment form. · The person who has signed the form is undertaking to use the practice for most of their primary health care needs. · The clinical notes for this person will be transferred to the provider they've enrolled with, which is currently an approach regarded as best practice.

What are the benefits for people enrolled with a PHO? It allows PHO providers to:

Understand the ongoing health needs of people who have enrolled; Help people better understand how to stay healthy and what to do when they are unwell; Reach out to those groups in its communities who have poor health or are missing out on primary health care; Involve its communities, iwi and enrolled people so that these groups can contribute their views on the services the PHO provides.

Also, cheaper fees apply in some areas. From October 1 2003, visits to GPs and practice nurses will be cheaper for young people aged 6-17 years (inclusive) who are enrolled in a PHO.

What are the benefits of using the same health provider? · People are able to build a good partnership with the GP and/or practice nurse. · Continuity of care is good for your health. · People need not give their medical history at each visit - the practice will have a record of their health information and understand their health needs · The practice can co-ordinate the health care of enrolled people. For example, if a person needs health care from a range of other health professionals, the provider will organise this care · The practice can co-ordinate recall and health screening programmes to offer preventative services.

What are the benefits of enrolment for PHOs and provider members? · The move to population-based primary health care changes the way in which PHO providers will be funded. Instead of being funded for each consultation, a PHO gets Government funding based on the number of people enrolled and the demographic characteristics (eg age, gender, ethnicity) of its enrolled population. This change gives providers greater flexibility to work in a team with other health professionals and provide services in new and improved ways. · Depending on their existing funding level and the characteristics of their population, some PHOs will get additional funding so that they can offer their enrolled people low-cost or free access to services. From 1 October 2003, an estimated 1.2 million New Zealanders were eligible for low-cost care through PHOs. · Health care services can be targeted more effectively. Information provided at enrolment can be collated to give the PHO an overview of the demographic composition of its enrolled population. · Health care services will be responsive to the needs of the enrolled population. A PHO must demonstrate that it involves its enrolled people in its governing processes.

How do DHB duplicate enrolment rates compare?

July 2003 quarter DHB Duplicate enrolments

Auckland 12.0%
Bay of Plenty 4.5%
Canterbury 2.2%
Capital & Coast 6.0%
Counties Manukau 13.6%
Hawke's Bay 2.2%
Hutt Valley 2.5%
Lakes 5.1%
MidCentral 3.3%
Northland 7.4%
Tairawhiti 7.8%
Taranaki 1.8%
Waikato 5.5%
Waitemata 6.5%
West Coast 1.6%
Whanganui 4.5% N
ational average 8.6%

July 2003 quarter

PHO Type Data Total Percentage

ACCESS Patient numbers 774908 Enrolment duplications 88103 11.4%
INTERIM Patient numbers 511831 Enrolment duplications 37517 7.3%
MIXED Patient numbers 653513 Enrolment duplications 41151 6.3%
Patient total 1940252 Duplicates total 166771 8.6%

Why is the duplicate rate so high in Counties Manukau? This is complicated and there are many reasons. These relate to how enrolment occurs, practice management systems and the region's mobile population.

What is capitation-based funding (CBF)? It is primary health care funding based on the number of enrolled patients given care rather than patient visits, like the fee for service style of funding. CBF is aimed at encouraging proactive health care in the community.

For more information, see the Capitation-based Funding User Information Guide on www.moh.govt.nz/primaryhealthcare

What are the six recommendations identified as having highest priority? · Change to the enrolment rules to give precedence to enrolment over registration · Additional validation of fee for service (FFS) claims, in particular, validation of the National Health Index (NHI) number provided on FFS claims · Development of a national public awareness communication plan · Implementation of PHO audit protocols - including the recommended process for seeking reparation where financial loss is incurred. · Establishment of a software vendors' forum to contribute to the design of PMS changes · Implementation of a process for logging and responding to PHO-related IT system issues

How soon will the report recommendations be implemented? Work has already begun in some areas, particularly with the priority recommendations.

Ten of the recommendations will need national consultation. Implementation will depend on the outcome of this and may take up to 12 months.

What help is there for PHOs waiting for the recommendations to be fully implemented? A 12-month `funding floor' plan for those Access PHOs and Access practices experiencing financial hardship since becoming part of a PHO

A `stop loss' arrangement on fee for service deductions is now available and included in the latest PHO contract. This three-consultation threshold is the maximum number that can be claimed against a practice every month.

How many Access practices or PHOs have applied for the funding floor? The Ministry is aware of eight cases that are still being considered by DHBs, which assess approval on a case by case basis

What else is being done to ensure the ongoing financial viability of PHOs? The Ministry is reviewing the level of the PHO management fee, particularly recognising the problems small to medium PHOs are facing. This may involve a two-stage process, with short-term increases to support PHOs until a fuller, more detailed review of management prices is completed.


Ruth Avery Executive Assistant Communications Corporate & Information Directorate Ministry of Health.


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