Population-based health funding ‘not acceptable’

Press, 20 October 1986, Page 7

Population-based health funding ‘not acceptable’

Full support to the West Coast Hospital Board in “pursuing a vigorous campaign to eliminate the restrictions imposed on it by population-based funding” was given by a conference on employment in Greymouth on Friday. The conference, organised by trade unionists, decided to ask the Government to remove the “constraint.”

It recognised the importance of the health services in the provision of employment and committed itself to the maintenance and expansion of the health services. The chairman of the West Coast Hospital Board, Mrs Eileen Kelly, told the conference that continued cuts or restraint was not acceptable to the board, and it wanted special consideration.

“The Minister of Health and his officers have been helpful to date, but the

time has arrived for meaningful discussions to settle the issue,” she said.

The board is the largest employer on the West Coast. It operates nine hospitals and old peoples homes in Westport, Reefton, Greymouth, Hokitika and Whataroa. “While the board is not an employment agency as such it is clear that such a labour-intensive industry is an important, even crucial economic asset to the region,” said the chief executive of the board, Mr Peter Kerridge. Mrs Kelly said that it seemed to be forgotten that the population-based funding system was seen as perhaps second-best choice when the original committee on hospital board funding reported in 1980. It seemed to have been adopted for reasons of expediency. The other

system involved funding linked to services, as operated in British Columbia.

“In other words the needs and level of health services for a population are established as the basis for funding. “At present we have an allocation and the health plan has to fit the money,” said Mrs Kelly. “If our needs, not just wants, were funded we would be happy and so would employees as jobs would be preserved and opportunities created for further employment.” Mr Kerridge said that the prime purpose of the board was the delivery of hospital and health care services in a variety of suitable, relevant ways and in the most economic manner.

Since the introduction of population-based funding in 1983 the board has been required to cope

with restraints totalling $1,150,000. Around 80 per cent of a hospital board’s maintenance expenditure was required for salaries and wages.

Mr Kerridge said that the board’s budget for 1985-86 was $25.1M. The Government grant was $23.5M and the board expected to raise SI.6M in revenue itself, leaving a draft deficit of $llO,OOO.

“We started this financial year with a carryforward deficit of $125,000 from the 1984-85 year, plus a restraint of $50,000 this year which left us $175,000 behind before we started,” said Mr Kerridge.

The board had attempted to cope with the pressures of populationbased funding but now felt that further restraint could only be at the expense of existing institutions.