Health agencies’ dispute costly

The unresolved long-running multimillion-dollar dispute between the Southern District Health Board and South Link Health has cost both sides several hundred thousand dollars.

Figures released by the Southern District Health Board, in response to an Official Information Act request, show it has spent $263,002 since 2009 on external legal advice and accountancy services.

It did not identify how much internal staff time might also have been involved with the dispute.

Asked for its costs, South Link Health identified $190,000 of legal costs, part of its total costs figure of an estimated $400,000.

It suggested that although the $400,000 total included staff time, it was potentially significantly underestimated.

SLH executive director Murray Tilyard said the real cost related to the lost opportunities for improving health care which should have occurred "while all the energy was put into trying to resolve the dispute''.

He said it had and "potentially continued to have a significant detrimental effect on relationships between general practice in Otago/Southland and the district health board''.

The dispute is over approval and accounting for the spending of about $5.3million in savings (now believed to be more than $15million with the addition of interest) which South Link Health, an independent practitioners association, made on contracts in the 1990s.

South Link Health has always maintained the money was spent on approved programmes while the board has challenged this.

The DHB signalled in September it wanted to resume negotiations but there has been no progress on this since it made an initial email approach to SLH.

At that time, SLH said the matter was likely to be taken to the SLH board at its next meeting, following which it would be in touch.

DHB chief executive Carole Heatly said acting chief financial officer Wayne Leach had been briefed by the solicitor managing the case for the DHB and would be again approaching SLH to reopen commercial discussions.

This week, Prof Tilyard said the SLH board had met to discuss the matter and "a letter will be sent to the DHB in due course''.

While he did not elaborate further, in September he commented that "with the Serious Fraud Office finding no case to answer, then the SLH board may believe that the matter is therefore closed''.

The talks faltered in August last year when SLH withdrew, following the board's decision to refer the dispute to the SFO.

In June this year, the SFO announced it was not going to conduct a substantive investigation or refer the matter elsewhere.

The ombudsman's investigation into complaints, some dating back to May 2013, about the refusals of both the National Health Board/Ministry of Health and the SDHB to release documents related to the dispute remains uncompleted.

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