Dr Jonathan Coleman National Party Associate Health Spokesman

15 March 2006

Smaller DHBs struggle for viability under population-based funding

Small DHBs are struggling to make ends meet under the Government's population-based funding formula, says National Party Associate Health spokesman Dr Jonathan Coleman.

The chief executive of the West Coast District Health Board admitted to the health select committee today that the DHB is not financially viable without a Government bailout.

"Without a $2.68 million bailout from the Government, guaranteed until the end of the 2006-07 financial year, this will be yet another DHB in deficit," says Dr Coleman.

"The DHB is currently reconfiguring services at Grey Hospital in order to be viable without extra government assistance, but the CEO and CFO were unable to put a dollar figure on projected savings.

"What we have here is a DHB that is not financially viable and no assurance that the situation will be any different once the Government withdraws its bailout funding.

"It is clear that the Government's population-based funding formula just does not work for smaller DHBs," says Dr Coleman.

ENDS

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