Right prescription

22/10/2009

The health system has been ailing.

Labour’s prescription was to change the system and increase the budget.

National’s priority is front line services – better, sooner more convenient care, as the pre-election policy promised.

Health Minister Tony Ryall has made a good start with an announcement of changes to backroom functions which should free hundreds of millions of dollars to be spent on frontline services over the next five years.

“Cabinet has agreed to a number of proposals from the Ministerial Review Group’s report ‘Meeting the Challenge’ that will greatly improve national and regional cooperation and reduce duplication of back office functions, ” the Minister said.

As a package, the changes will move up to an estimated $700 million in savings over five years to frontline services. That would buy about 16,000 heart bypass operations or build two large city hospitals.  The changes are also expected to reduce the health system bureaucracy by up to 500 administration jobs. These would be managed as much as possible through attrition and voluntary redundancy.

“The National Government inherited a public health system that wasn’t well placed to cope with the significant financial and clinical challenges facing it. There is too much duplication that has led to poor regional and national performance and a track to financial crisis.”

 The loss of 500 jobs is not insignificant, especially if they can’t all be handled through attrition and voluntary redundancy, and backroom functions are important. But each of the 21 health boards doesn’t need to perform all of their own individually and money saved in the backroom will be available to do more for front line services.

“The Government wants better coordination between District Health Boards (DHBs) and the Ministry of Health, and we want neighbouring DHBs working better together to improve services. Clinical networks will be a big part of this cooperation.”

The major changes include setting up a new National Health Board (NHB) within the Ministry of Health. The NHB will focus on supervising the $9.7 billion of public health funding the 21 DHBs spend on hospitals and primary health care.

The new NHB will manage national planning and funding of all IT, workforce planning and capital investment. It will also take national responsibility for vulnerable health services such as paediatric oncology.

Work will also start on consolidating the 21 DHBs’ back office administrative functions such as payroll and bill payments.

The Otago and Southland DHBs are consulting the public now on a possible merger and there has been little public opposition.  

Other boards may not be ready for that yet, but co-operation and handing over of services which can be handled centrally will be a good place to start in reducing duplicate costs in 21 separate health kingdoms.


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