No new money in health funding announcement on PBFF

Today’s health funding announcement gives no new money to the stretched health system and leaves big questions over the fairness of population-based funding, says National Health Spokesperson Dr Lynda Scott.

“The Government is saying it is putting millions of dollars of new money into health, but it is simply a reannouncement of the $3 billion over three years announced last December.

“The Minister says she will ‘expect boards to live within their budgets’ and the intention is for most boards to break even, but she is preaching the impossible under the structure she has set up.

“The reason boards are in deficit to the tune of over $230m is because of this Government’s restructuring to have 21 health funders instead of one. Giving them deficit relief without changing anything else is like a ' get out of jail free' card that doesn't stop reoffending.

“The success of the population-based funding formula is still a big unknown because we have not seen the formula. We don’t know how much age, rural factors or ethnicity are going to be taken into account to moderate the winners and losers.

“The formula is bad news for the South Island and good news for the north of the North Island, if Treasury predictions are anything to go by. Treasury estimated the South Island is likely to lose $40 million a year in funding if full PBFF was adopted.

“What is likely to happen is that the South Island hospital budgets will be held, while upper North Island budgets will go up,” said Dr Scott.

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