Lab test charges push up Wellington inflation

News release - for immediate use
16 May 2007

Lab test charges push up Wellington health inflation

The controversial patient charging regime for laboratory tests is behind a surge in health inflation in the Wellington area according to the Health Funds Association of New Zealand (HFANZ).

Statistics New Zealand data for the six months ending 31 March 2007 shows health inflation in Wellington running at three times the level of other regions.

Claire Austin, Executive Director of HFANZ, says she is not surprised that the charging regime has pushed up costs.

“We warned the district health boards early on that their proposal was ill-thought out and would have inflationary consequences. Our analysis found that the move would add several million dollars to total health costs in the region.

“Our feedback shows many patients are being hit with significant charges, well above the $10 average which was trotted out when the DHBs floated the regime.
We are aware of a growing disquiet among health professionals, with many coming under pressure to play ball with the charging regime.

• One patient was charged $568.48 for blood testing relating to a valve replacement.
• Another was charged $1,750.89 for testing relating to an aortic valve replacement.

“These are multiple tests over a period of several days, with an administrative charge loaded on for each day. It is a payment for bureaucracy. What was purported to be a cost-saving measure has actually increased total health costs to the community. By any measure, this has failed.

“The Wellington experience serves as a good indicator of what will happen to health costs nationally, with a 2% increase in costs likely. And this is just initially, with prices capped for a year. Further cost escalations are likely at the expiry of the capped period.

“Our advice to district health boards and the Ministry is to have another look at this and do it with some urgency. The numbers simply do not add up and patients are suffering because of an ideologically-driven regime.

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