THE PRESS FRIDAY, APRIL 8, 1988. Value from the health dollar

Press, 8 April 1988, Page 16

THE PRESS FRIDAY, APRIL 8, 1988. Value from the health dollar

i . I 11 The Task Force on Hospital and Related Services, reported ttiis week, has set the scene for a fair old scraip between vested interests as [to wljat sort of'health system New Zealand should have. The task force has gone too far towards dismantling the public sector hospital system for the taste of some people; it hab not gone far enough for others. Mr Alan Gitibs and the other members of the group have (suggested that (as much as $(j00 million could; be saved through a rearranged and more efficient hierarchy in the provision of health services; A carrot of; this size !■[— roughly equal to the cost to| taxpayers of the unemployment benefit forjja year — must tempt the Government to go at [least part of the way with the [suggestions.! ( | The Minister of Health! Mr Caygill, has reservations!. The Hospital Boards’ (Association is aghast. ([Health service Employees are angry. Mr[ Caygill’s doubts about facets of the report will be reinforced :by these groups: as soon as they have organised their troops. Other groups chary of the emphasis ion profit i motive and competition can also use the next two months to make known their views. The time 'for comment on the report will [end then, andjthe Government willl have to decide its course soon after. If it errs on the side of caution, and introduces limited changes only, it risks having the promised savings evaporate; [piecemeal [tinkering will I [offer piecemeal [savings at best. If the Government takes the 'plunge, and! it adopts the major surgery that its advisers recommend, .it [still has i [no guarantee that the predicted efficiency (will materialise.! | j j . ; Few can doubt that improvements can be made. Perhaps feeling that trie details [are common knowledge already, the task force is a little imprecise in its presentation [of shortcomings in the present system; It excuses this by! arguing; that insufficient record is kept of health service; performance, and that this failing is itself; evidence [ of managerial! inefficiency. Even when hard statistical information is available, however, the task force prefers to; report in more general terms. Nonetheless, it is a fact [that many more people are oh hospital wailing lists now th[an there were a decade ago.[The task force puts the total atl more than 50,000 and suggests that the increase over the! 10 years is of'the order of 25 per cent. About 6 per cent ofl that increase could be attributed to natural population growth; something! that the task force seems to have overlooked; though the poirit made still reflects! [the inability of the' system to keep up with demand. I ■ I ; J • | ( The figures are probably fluid from month to j month and, as I the task force acknowledges,' the waiting lists are usually well out of date. As a measure of demand, the lists are of limited value! They do not, in any event, reflect on the quality of treatment and care a vailable to those whose waiting is 'over. In this respect, trie health system delivers a pretty good product. It can be accepted, though, that more people are waiting lodger to get into public hospitals for treatment. I : j H - Just why this is so is not revealed. It cannot be I put [down simply to a lack of taxpayer ( contributions ;to the system. Parliament voted health services $3409 million last year, about! 18 per cent of Government spending, and second only to the Social Welfare Vote, when debt servicing is excluded. This | is, in fact, a little more generous [than [the 17 per cent of ■ the Government’s Budget that went to health services a (decade ago, in 1977.

: I !I I ■ Indeed, [ in the last two years for which full figures are available — triotse ended on March 31, last year -L taxation-funded spending on hospitals increased by more than 50 per cent in money terms* and, more important, by almost 20 per; cent in real terms after adjustments have been made for inflation. More money does not equal a better service. Most of that increase [in taxpayerfunded spending was absorbed hy increased salaries for doctors and ( higher wages for nurses. This is not to say that the increased remuneration was unjustified, and certainly is not an argument that the monej[ should have been spent elsewhere; it simply illustrates that another $lOO million from taxpayers for health services does notj necessarily mean one extra nurse or one more bed to care for patients. [ I ' Tailoring the health budget [to the needs of the day [never will be easy. T[he task force report notes in passing j — but does [ not analyse further — a rapid i increase in demand for certain types of [ surgery,! for instance. In the last two (years* alone, there has been a 47 per cent addition to the waiting list of people wanting qataract operations. Hip replacement' operations and j the treatment of geriatric complaints also show a marked rise. The truth is| that the population is showing an inexorable advance into old age. More people are Hying longer — the health system is seeing to [that — and therefore .the diseases and afflictions of the old are becoming increasingly* important in calculations of what the health system must cater for.[i This circumstance signals* another axiom of health care: there is a bottomless pool of demand for health services. T(he task force reports that New Zealand spends a lot on hospitals compared witri what is spent in Australia and Canada, and attributes this to inefficiencies. The task force might be right; it is certainly correct when it that the percentage of gross do'mestic product spent on (health care varies almost directly according to a country’s! standard of living. ‘‘Third World countries spend almost nothing on hospital care; rich countries spend more on health' and hospital care, (just as they do on holidays, restauqantsi [ and other discretionary services.” So says the report. It does not state the necessary corollaries — the demand for health care will expand to absorb the resources [available, and | the available resources will never be sufficient to meet the j insatiable demand. [ The question, as alw[ays, j comes down to one of getting value for money. The task force has identified correctly the near impossibility of making' j rin informed 1 judgment on this (in (the present circumstances. Whether the task [force recommendations will [ [ remedy | the shortcomings — and whether they are the best, or indeed the only* remedy — are the nub of the debate that (is prompted by the report. Is a different system of management needed, or just better management? Will the creation of extra tiers df bureaucracy ■ mean that more of the health dollar goes to ease the lot of patients, orj that more will be absorbed in administration? Can there be direct competition between private, and public hospitals that does not pose a threat to the training and research work that traditionally has been a part! of the public hospital system? These are (a few of the questions raised by the; report; it does not answer them convincingly. and! other issues will have to be (Settled if the result is not to be another I 'sticking-plaster solution. [ [ ||