Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, WEDNESDAY, MAR. 15, 1939. HOSPITAL EXPENDITURE

Poverty Bay Herald, Volume LXVI, Issue 19887, 15 March 1939, Page 4

Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, WEDNESDAY, MAR. 15, 1939. HOSPITAL EXPENDITURE

The controversy between the Farmers’ Union and the Municipal Association regarding the basis of contribution towards hospital expenditure is not likely to lead to any direct results. More probable is it 'that it will tend to obscure what should be the real issue, that of hospital administration and expenditure generally. The complaint that rural or urban local bodies pay too large or 100 small a proportion of the total levy is a hardy annual, growing more vigorously in seasons where a revaluation in one part of a district has altered the incidence of payment. The levies are fixed on a basis of valuation and rural interests have contended that the system should be based, instead, on population. The effect of such a change can be seen from the figures for 1936-37, the latest available. In that year, boroughs with a total population of 900,000 paid £355,000 towards hospital administration, but counties, with a population of 650,000, paid £349,000. A levy on a population basis, therefore, would give considerable relief to county ratepayers, but it would transfer the burden to the thickly-popu-lalcd areas where there is, perhaps, least ability to pay. In these circumstances, there is much to be said for the contention that hospital costs should be levied as general taxation on salaries and wages in accordance with the principles adopted in the latest legislation. This question, however, is one that deserves consideration from a much wider angle, for while a controversy rages as to who should foot the bill no one seems to be particularly concerned at the almost alarming growth in hospital costs. Those who are so anxious to shift the burden might be belter occupied in inquiring whether the burden itself cannot be reduced. The first difficulty that arises in this connection is that those who pay the piper have not the right to call the tune.' Hospital boards are not themselves rating authorities but merely budget for the required expenditure and then summarily call upon the other bodies to provide the revenue. It is true that hospital board members are elected in tho ordinary way, but since they are not held directly accountable for increases in rates they escape the opprobrium that might attach to a perfectly innocent member of the contributory local body. Nor do hospital loan proposals have to be submitted to the ratepayers for their approval, so that this check on expenditure also is lacking. It tnay or may not be significant or typical of the general experience that in this district the only new capital works undertaken in recent years have been those embarked upon by local bodies who

have not been required to obtain the sanction of the ratepayers. The latest detailed information that is available regarding hospitals finance is that for 1930-37, before rising costs had fully manifested themselves, but the figures even for that year clearly indicate the trend. From 1932 lo 1935, hospital expenditure was fairly stable at just over £1,300.000 a year. In 1935-30 there was a rise of more than £50,000, but in 1936-37 a new record was created and an advance of more than £235,000 brought the total to more than £1,600,000. Various factors no doubt contributed to this increase, but the cost per occupied bed, which is the most reliable basis, rose from £l6B in 1933-34 to £202 in 1936-37, an advance of 20 per cent in only three years. The three main items of expenditure, salaries and wages, domestic and establishment, and provisions, all increased in approximately the same proportion. Practically the whole of the cost of this increase was passed on to the contributory local authorities and the Government, for patients were actually paying less per occupied bed —notwithstanding increases in charges —in 1936-37 than they were between 1932 and 1931. On the other hand, inking an average for the three years 1933-36, local bodies and the Government paid an average of, £1,100,000 a year, but for the three years 1935-38 the amount of their contributions had increased to £1,300,000.

The falling off in the collection of fees from those who benefit from hospital treatment is one point which appears to demand investigation. In 1932-33, a time when economic conditions were never worse, collections from patients represented £56.6 per occupied bed, but in 1936-37, when conditions were relatively prosperous, patients were only able to pay, or only paid, £50.1 per occupied bed. In 1935-36, patients’ fees represented 21.4 per cent of the total hospital revenue, but in 1936-37, with increasing prosperity, the percentage fell to 21.1; Then there is the question of the hospital population. In 1927-28, the number of inpatients treated was 55.3 per 1000 of population. In the following year it rose to 60.2 per 1000, but in Ihe depth of the depression it fell to 56 per 1000. From 1933 on it commenced to rise again and in 1936-37 created an all-time record of 66 per 1000. Here, then, is another factor adding to the cost of hospital administration—the fact that there were only 85,000 patients in 1933 but 104,000 in 1936-37. Just why there should be such an alarming increase in illness in a country like New Zealand is a problem which only the scientists can answer, but it is clear that this is the root of the whole problem. The first obvious task of those who are anxious to reduce the cost of hospital administration is to tackle the question of the prevention of disease, and the second requirement is to devise some better system for controlling hospital expenditure. Once these factors have been dealt with, there will be less occasion for concern as to which section of the community should foot the bill.