Hospital Funding Not Finalised

  • Bill English

Health Minister Bill English said today the funding for hospitals was not yet finalised and it was wrong to assume there would be cuts in some areas, particularly in the southern hospitals.

"The announcement this week from the Transitional Health Authority referred to indicative levels of funding only. These indicative levels do not include additional money for health recently announced by the Prime Minister and deputy Prime Minister, which will be spent on priority areas such as elective surgery.

"Information given to hospitals this week is the first step in the contracting process. The THA will be working with hospitals over the next six months to agree on funding for local services. During this time the additional funding will be finalised and will become part of the money available.

"It is important to remember that all areas will have an increase in funding for health services next year. The extra funding announced recently comes on top of an increase of $225 million announced in this year's Budget.

"Unfortunately a lot of the increase will be going on demand-driven items, such as pharmaceuticals, GP visits and laboratory tests. One of the challenges faced by the THA is finding ways to manage that demand-driven expenditure, so hospital budgets do not suffer.

"I have expressed my concern on a number of occasions that elective surgery is used as a financial safety valve in the public health service. What happens is that once we have paid for the GP visits, for the drugs, for the community workers, for the emergency work in our hospitals, what is left over goes to elective surgery.

"Within the health budget we have the job of ensuring there is sufficient funding to run our public hospitals so that they provide the level of service New Zealanders expect," said Mr English.