The PHO, which formed in October to merge nine Otago and Southland PHOs, is consulting interested parties on its clinical programme for 2011-12.
Southern is the first PHO in New Zealand to propose offering adult dental health care for its high needs population.
Southern PHO has 281,000 enrolled patients, with about 46,000 considered "high needs".
The PHO "unashamedly" proposed putting $250,000 into dental care for those eligible because "some unfortunate people right now have got very poor teeth", Dr Powell said.
"Some people have queried if more of the money should go into dental heath promotion rather than fixing up mouths that are already in a rotten state." He acknowledged there was no specific budget for oral health promotion, although those treated by dentists would receive advice on looking after their teeth.
The PHO would use separate dentists for assessment and providers to ensure the best use was made of the money.
Providing dentistry took some pressure off the district health board, as it could prevent people developing more serious conditions.
The PHO was obliged to look at areas of highest need and that had informed its priority list of spending for the year, he said.
It proposes spending $1 million on chronic conditions, child and youth $400,000, mental health $300,000, elder care $750,000, cancer $650,000 and health promotion activities pick list $600,000. The PHO also wants to establish a contestable health innovation fund, worth $150,000, to support pilot programmes that could be rolled out across the region if successful.
A challenge for the new PHO was providing equal access to programmes across Otago and Southland. This meant some programmes run by the old PHOs had needed to be watered down to allow them to be funded regionally, he said.
The proposed programmes used the PHO's discretionary funding, but some ring-fenced funded programmes, such as helping people with minor mental health issues, continued unchanged.
Dr Powell said the proposal document did not include other ring-fenced funding streams direct from the Ministry of Health for programmes such as helping those with minor mental health issues.
The Ministry of Health issued a statement confirming Southern was the first PHO to consider funding adult dentistry for high needs people.
"This is an excellent initiative which we hope will be replicated in other areas of the country."
