Solution to DHB financial deficits rests with Government

“The solution to district health boards’ financial deficits rests with the Government.”

This was response to the published report that almost all DHBs were tracking towards financial deficits for the financial year ending 30 June from Ian Powell, Executive Director of the Association of Salaried Medical Specialists (ASMS). https://www.nzherald.co.nz/politics/news/article.cfm?c_id=280&objectid=12192429

“There are three main reasons for these deficits. The first is the effects of eight successive years of underfunding that the current Government inherited. The Labour led coalition improved funding in its first year, but one good year does not compensate for eight years of underfunding. Underfunding leads to DHBs being forced to defer essential work such as building maintenance which only becomes more expensive when it eventually has to be paid for.”

Mr Powell added that the current Government is responsible for further increasing health funding to address this failure.

“The second reason is that the costs of treating acutely ill patients is continuing to increase due to factors such as the aging of the population, population growth and the effects of poverty. Cost increases due to increased demand are greater than funding increases.

“The third reason is that there is a lot of wastage and duplication in DHBs because of the lack of clinical leadership distributed through their senior medical workforce. Genuine engagement with senior doctors would improve both the quality of patient centred care and financial performance.

“Senior doctors are experts in complexity. They are well placed to contribute to improving the financial performance of DHBs by improving complex systems. But how can they when there is a lack of a sufficient engagement culture in their DHB. Further, how can doctors who are overworked, burnt out, and working while sick (even infectious) make this contribution?”

Mr Powell said the Minister of Health had to take responsibility for requiring DHBs to genuinely support distributing clinical leadership throughout the specialist workforce and to address the crisis of specialist workforce shortages.

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