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Cash Injections No Panacea for Public Hospitals

Cash Injections No Panacea for Public Hospitals Ailments

The Health Funds Association of New Zealand Inc. (HFANZ) today welcomed the announcement that additional funding was being made available for hip and knee replacement surgery but said that, like previous cash injections, it would not provide the cure-all for the public hospital system’s ailments.

“If this additional funding enables some of the people who need a hip or knee replacement to get the surgery they need, that’s great,” says Andrea Pettett, executive director of HFANZ. “But people will still need to wait to see a specialist and then queue for surgery in the public system.”

“While $70 million in 4 years seems like a lot of money, given both the size and appetite of public hospitals for funding, anyone who thinks that it will provide more than a temporary respite to the fundamental and underlying problems faced by the public health system, will surely be disappointed.”

HFANZ, the industry association for health insurers, is concerned that health expenditure is projected to eclipse national superannuation, given the correlation between an aging population and health expenditure.

HFANZ says that while the Government has not been backward in encouraging people to start saving for their retirement; successive Governments have not faced up to telling New Zealanders that they will also have to take greater responsibility for funding their own healthcare needs.

“The officials in Treasury and the Ministry of Health accept that while demand for healthcare is almost infinite; the resources to fund that demand aren’t. They also know that this country’s health expenditure is projected to almost double as a percentage of GDP over the next 40 or so years and that this comes at a time when the percentage of the population who are in the workforce will actually decrease.

“Clearly, the ability of the Government to adequately fund public hospitals offering the range of services they currently provide is going to be challenged,” Andrea Pettett says.

HFANZ says that this impending funding crisis is compounded by a lack of capacity in public hospitals where elective surgery volumes have declined since 2000.

“Despite increased funding, public hospitals are simply doing fewer elective operations,” Andrea Pettett says.

A Treasury report, released under the Official Information Act last week, which looked at the performance of district health boards concluded that public hospitals discharged fewer surgical patients than in the previous year, despite a 6% funding increase. It also projected that ‘national outputs of both surgical and elective surgical will be below those seen last year.’

Ms Pettett says that there are a number of reasons why this may be so: “Elective surgery is not the core business of public hospitals whose schedules are often disrupted by urgent cases caused by car accidents, sports injuries or sudden crises. Public hospitals have to deal with increasing numbers of acute admissions and trauma cases. As a consequence they have reduced capacity to cope with elective surgery despite increased funding.

“As a result waiting lists continue to grow and people in hospital awaiting their operation are often sent home, with their surgery rescheduled to a date when the hospital is hopefully less busy.”

HFANZ says that the only way around this problem is for public hospitals to focus on what they do well; to concentrate on providing 24 hour high-level emergency services and to contract elective surgery out to well equipped private surgical hospitals.

“The public and private sector complement one another and the primary hurdle to them working cooperatively is political. Successive Governments have failed to admit that the public sector doesn’t have the capacity to provide emergency services and undertake the quantum of elective surgery required. By failing to face up to this fact, despite evidence to the contrary, the public are misled into thinking the public health system will be there for them when they need it.

“Increasing numbers of New Zealanders are learning that this is not the case and, once they need an operation, it is too late to call a health insurer and arrange insurance to fund an operation in a private hospital.”

HFANZ says that the time is rapidly approaching when the Government will have to encourage people to make some provision for their own healthcare, just as they have acknowledged that it is prudent for people to save for their retirement.

“The Government will not be able to afford to continue to fund a comprehensive public health system; in fact the evidence suggests that the public system is failing New Zealanders now.

“More cash injections may keep the public hospitals on life support but the sooner the underlying problems are acknowledged the better. Denying the obvious does New Zealanders a disservice; their misplaced confidence in the public hospital system means they fail to arrange health insurance cover that could secure their healthcare needs,” Andrea Pettett says.

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