By Hamish Hutchinson
New Zealand has a proud history of a public healthcare system that anyone can access. Sadly, this has changed and our public healthcare system is under threat from systemic underfunding. Between 2010 and present, our health system has been underfunded. In 2017 we will need an extra $1.85 billion to restore our health systems budget to 2010 levels. i
This is equivalent to 7400 doctors, 27,750 nurses or 111,000 hip operations. That’s a lot. This figure is based on proportion of GDP. In 2010 the health system took 6.32% of GDP, whereas in 2015 this figure was 5.95% (Figure 1). So while health spending is reported to be increasing, with the government celebrating their record increases each year, the proportion of GDP has actually gone down. Beyond simply being figures and numbers, these changes affect people’s lives.
Two realities occur when healthcare services are underfunded. The first is that stricter criteria are applied when accessing publicly funded services. The second is that public services have to rely on the creation of a market for substitute private services. To highlight this issue, the provision of knee and hip joint replacements can be used to show the effects of healthcare underfunding and how the health system in Aotearoa/New Zealand has growing unmet need and that private health provision is filling this gap.
Shutting the door on people in need
Figure 2. Publicly-funded hip and knee total joint replacement procedures in New Zealand for those aged 20 years and over from 2006–2013 by year. iii
Looking at criteria for accessing publicly funded services, a study published in the New Zealand Medical Journal in April of 2016 looked at the severity of disability a person experienced waiting for a publicly-funded knee or hip joint replacement. ii
They concluded that people waiting for hip and knee replacements in 2014 are more disabled by their condition than people in 2006-2010. That means more pain and less ability mobilise and do normal daily activities. The report announces that people are currently being returned to the care of their GP who in 2006-2010 would have received joint replacement surgery. The threshold for receiving public-funded care is shifting. It is harder for people to access public funded services. The door has been shut on a number of people who should be getting publicly-funded service.
The other reality of underfunding is that increased demand on services will be met by private providers rather than public. A market is created. One of the best ways to show this would be to display hip and knee joint replacement figures from private providers compared to public. The problem with this is that this data is unavailable. Private surgery rates are not available unlike public figures. But irrespective, we can still join the dots from other measures.
A happy reliance on private healthcare providersThe first piece of data, from an article in The New Zealand Medical Journal, shows this concerning trend is around average joint replacement surgery rates. iii
Since 2007, rates around the country of publicly funded joint replacements have not significantly changed, as shown in Figure 2. While actual numbers may have increased (as shown in the denominator column in Figure 2) the rate per 100,000 people per year has remained stable. With an ageing population you can expect demand to increase because people aged over 65 are the highest users of joint replacement services, and with this we should expect to see an increase in public-funded rates per 100,000. Some projections place the increased need for hip joint replacements at 174% and knee joint replacement at 673% by 2030. iv
Currently there has not been an increase in rates in public-funded services to meet the increasing demand. Some of this demand is shifted because criteria has shifted (i.e. it is more difficult to get hip and knee joint surgeries). But because public rates haven’t increased, some of this demand will also be taken up by non-government/private funded services. A private market is therefore propped up by failings in public services.
The second piece of data which shows private providers capturing this unmet need comes from looking at regional differences and comparing private health insurance rates. Throughout Aotearoa/New Zealand there are regional differences in rates of hip and knee joint replacement surgeries. The same study mentioned previously from the New Zealand Medicalv showed that there are regional differences in rates per 100,000 people between DHBs (Figure 3). The top performing DHB was West Coast, which completed 449 surgeries per 100,000 per year, whereas the worst performing DHB was Auckland with 131 per 100,000 per year. The report shows that provision of public funded joint replacement surgery is poorest in main centres compared to smaller regional DHBs. These findings are consistent with Ministry of Health data (Figure 4) which shows which DHBs have the highest rates of private health insurance. vi
So as you would expect, the areas with higher rates of private health insurance are the areas with the poorest rates of hip and knee joint replacement surgeries, these areas being New Zealand’s three largest cities: Auckland, Wellington and Christchurch.
Important to note, once age and social deprivation levels were taken into account, rates of surgery were still lower in main centres compared to regional DHBs. What this shows is that there appears to be a mutual relationship between some DHBs and the provision of private joint replacement surgeries. Are DHBs in the main centres potentially keeping rates low in acceptance that this need will be met by private providers? Are DHBs in main centres content with allowing a person’s financial capacity to determine their access to supposed universal health care?
The third and last piece of data, and most alarming is that 2016 was a record year for private health insurance funding. The Health Fund Association of New Zealand (HFANZ), the body representing health insurers in Aotearoa/New Zealand, reported that “claims paid for the year jumped 9.4 percent to $1.136 billion as insurers funded record levels of elective surgery”. vii
Are more and more people turning to private health providers to get surgery? This would be only reasonable, especially considering the fact that, according to the HFANZ, elective surgery average waiting times have risen from 85 days in 2013 to 304 days in 2016. viii.
One could imagine that this situation is only going to get worse as time moves on and nothing is done – unless of course a person have the ability to pay.
Is this is what we want?So from all of this we have to ask ourselves whether this is okay? Is it okay that our public-funded services are relying on people having private insurance? Is this the sort of public healthcare system we want? Our current system is creating differential access based on income to what should be an absolute right to access.
The Save Our Public Health campaign is raising the issue of public health underfunding in Aotearoa/New Zealand. We want a public healthcare system that everyone can access. That means, irrespective of your wage each week, if you need a hip joint replacement because you are in pain and having difficulty mobilising, then you should get one. You should not need private insurance to get this, and you shouldn’t be made to live in pain because you don’t have private health insurance. This is not our health system.
Our health system is universal. And for it to be truly universal it needs to be funded properly to flourish – not just be in survival mode. We need to save our public health system.
ii Gwynne-Jones D, Iosua E. Rationing of hip and knee replacement: effect on the severity of patient-reported symptoms and the demand for surgery in Otago. N Z MEd J (2016), 129;1432:59-66
iii Harcombe, H., Davie, G., Derrett, S., Abbott, H., & Gwynne-Jones, D. (2016). Equity of publicly-funded hip and knee joint replacement surgery in New Zealand: Results from a national observational study. The New Zealand Medical Journal. 129(1442)
iv Hooper G, Lee AJ, Rothwell A, Frampton C. Current trends and projections in the utilization rates of hip and knee replacement in New Zealand from 2001 to 2026.NZMJ. 2014 Aug 29;127:82–93.
v Harcombe, H., Davie, G., Derrett, S., Abbott, H., & Gwynne-Jones, D. (2016). Equity of publicly-funded hip and knee joint replacement surgery in New Zealand: Results from a national observational study. The New Zealand Medical Journal. 129(1442)
vi Ministry of Health. 2016. Private Health Insurance Coverage 2011–15: New Zealand Health Survey. Wellington: Ministry of Health.