|Taskforce report on health system restructuring|
|Implemented in this survey?|
In October 2009, the new National Party-led government responded to the recommendations of a Ministerial Review Group regarding the structure of the health system. Three notable aspects of the government's response are the creation of a new National Health Board (NHB) to be located within the Ministry of Health, the creation of a Shared Services Establishment Board, and a refocusing of the role of the National Health Committee.
A government-appointed taskforce called the Ministerial Review Group (MRG) reported in August 2009, making over 170 recommendations regarding the structure of the health system and the allocation of roles and responsibilities (see Survey No. 14, 2009).
The government considered the report and, in its response in October 2009, made a range of decisions which aim to 'reduce duplication around planning, capital and IT, and consolidate the 21 District Health Boards' (DHB) back office administration functions'. The reform likely to have the most impact is the formation of a new National Health Board, as recommended by the Ministerial Review Group. Other significant changes include creating a Shared Services Establishment Board to consolidate DHB administrative functions and changing the focus of the National Health Committee to concentrate on prioritising new health technologies.
1) Establishment of a National Health Board within the Ministry of Health
The National Health Board (NHB) will have significant responsibility for funding and monitoring the publicly funded health system. At a national, regional and local level, the Board would co-ordinate the planning and funding of services. The NHB is to be a branded business unit which sits inside the Ministry of Health, with a ministerial advisory board to report on its performance. Members of the Board are appointed by the Minister of Health. This is a significant departure from the MRG recommendations which were for a 'stand-alone' agency, independent from the Ministry. This option has been chosen because it will keep legislative change and sector disruption to a minimum (thus speeding up the process of establishment). It also had the advantage of countering the most vocal critics who questioned the democratic accountability of a stand-alone National Health Board.
The Board will be responsible for specialist national services such as paediatric oncology and will consolidate planning and funding of IT, Workforce and Capital through three further expert boards. At present, most of this work is done by the Ministry of Health so the formation of the NHB would result in a major restructure of the Ministry with a large proportion of Ministry of Health staff transferring to the NHB, with a possible devolution of some further services to DHBs in the future. The Ministry of Health would then be left to concentrate on the 'core functions of policy, regulation and monitoring'.
2) The Shared Services Establishment Board
The overall objective of the Shared Services Establishment Board (SSEB) is to reduce the cost of DHB administrative support services. 'Backroom' functions such as payroll and purchasing, HR and transactional information systems are presently conducted independently at each of the country's 21 DHBs. The Board is responsible for the consolidation of these tasks so they are performed at a national level, thereby reducing duplication and waste at the DHBs. The government's view is that using a combination of shared services, business process outsourcing and centres of expertise will optimise administration services. The Government believes NZ$700 million will be saved over a five year period as a result of this initiative, with the reduction of an estimated 75 to 300 staff.
3) Reshaping the role of the National Health Committee
The National Health Committee (NHC) currently advises the Ministry on priorities of health and disability services and other matters relating to public health. The 'reorienting' of the NHC may possibly involve its strengthening so it has the expertise to make decisions on the introduction and prioritisation of new treatments or technology. This attempt to tie resource allocation decisions to health technology assessment is partly motivated by perceived shortcomings in the existing voluntary, collaborative approach under the Service Planning and New Health Intervention Assessment process that was initiated in 2006. However, as yet there is no nationwide systematic process in New Zealand to make prioritisation decisions regarding new treatments.
|Degree of Innovation||traditional||innovative|
|Degree of Controversy||consensual||highly controversial|
|Structural or Systemic Impact||marginal||fundamental|
|Public Visibility||very low||very high|
Since the government responded to the MRG report, the policy changes in this area have become less controversial and more consensual. Because the NHB is located within the Ministry of Health, the structural/systemic impact is now rated as rather marginal instead of neutral. Public visibility is lower, partly because of the reduced level of conflict regarding the Minister of Health's decisions.
|Implemented in this survey?|
The positions of most groups towards the changes to the structure of the health system are similar to the positions reported in the previous survey ( 14/2009). The notable exception is the position of the Association of Salaried Medical Specialists, which was originally concerned that the creation of a stand-alone National Health Board would compromise the democratic accountability of the health system. Their stance is now more neutral since the decision to incorporate the NHB within the Ministry of Health.
|Minister of Health||very supportive||strongly opposed|
|New Zealand Medical Association||very supportive||strongly opposed|
|Association of Salaried Medical Specialists||very supportive||strongly opposed|
|Public Sector Association||very supportive||strongly opposed|
Some of the changes envisioned will require amendments to the New Zealand Public Health and Disability Act (2000) but so far, no legislation has been drafted.
|Minister of Health||very strong||none|
|New Zealand Medical Association||very strong||none|
|Association of Salaried Medical Specialists||very strong||none|
|Public Sector Association||very strong||none|
Members of the NHB have been appointed, as has the National Director, and the NHB has begun meeting. The National Health IT Board has been formed and is to sit under the NHB. The board is a slightly changed version of the Health Information Advisory Committee (HISAC). The new IT Board will develop a national IT strategy to allow all stakeholders to know their respective roles.
The members of the SSEB have been appointed. In a recent cabinet paper on expanding the role of PHARMAC (which is responsible for managing government-subsidised pharmaceuticals) to include procurement of medical devices, the government gave the SSEB the responsibility for identifying medical devices whose collective procurement could save money.
There have been no updates on the reorienting of the NHC since the announcement by the minister in October 2009.
There will be a review of the structural changes after three years (i.e. late 2012).
The MRG process (the release of the report, and health sector feedback) revealed broad consensus on the need to consolidate some health system functions such as planning of (some) specialist services, planning capital expenditure, procurement of equipment and rationalising 'back office' functions such as payroll.
The government hopes to make of at least NZ $700 million in the next five years. This may be overly optimistic. However international experience suggests that, if the SSEB can operate effectively, large savings could be made in back room services.
While the expansion of the NHC's role has been welcomed, it remains to be seen whether it will gain much traction in moving to explicit prioritisation processes for medical technologies. The challenges in this area are formidable.
Finally, the creation of the National Health Board has the potential to shape the ways in which many publicly funded health services in New Zealand are planned and delivered. Given that the District Health Boards generally welcome some centralisation of their roles, we would expect service reconfiguration in many areas to be reasonably smooth. However, the devil will be in the detail, and while there is broad sector agreement in principle for the new model, once the NHB makes specific recommendations we will begin to see how firm or fragile this broad consensus is. Given the past history of attempts at service reconfiguartion in New Zealand, we can also reasonably expect pockets of public resistance as some hospitals are likely to have some of their functions downgraded.
|Quality of Health Care Services||marginal||fundamental|
|Level of Equity||system less equitable||system more equitable|
|Cost Efficiency||very low||very high|
The government believes that this suite of changes will result in a more efficient and better quality health system. Our ratings are more conservative, not because the government's analysis is overly-optimistic: advice to government on the benefits of the reforms is quite measured. Rather, we have predicted minimal impact at this stage until it is clear what hurdles will arise during the implementation process, and we begin to see whether the degree to which these hurdles are successfully negotiated by the restructured health sector.
The rating of impact on cost-efficiency has changed, however, mainly due to the prospect for savings generated by the Shared Services Establishment Board.
|Taskforce report on health system restructuring|
Process Stages: Policy Paper, Idea
Kim Letford, Tim Tenbensel