Taxpayers are getting less and less for their money when it comes to public hospitals, a report commissioned by lobby group the Business Roundtable says.
"In essence it appears that, in spite of continuing substantial -- and possibly unsustainable -- increases in funding each year, productivity in the public hospital system is actually deteriorating," Business Roundtable executive director Roger Kerr said today.
The study, which incorporated a 2005 Treasury Report and additional research by public sector analyst Mani Maniparathy, measured hospital productivity against how much cash they spent and staff numbers.
Productivity was measured via a standardised 'weight' of procedures known as 'outputs' -- such as one hip replacement has a weight of 4 while an outpatient visit is worth just 0.1.
Mr Maniparathy told NZPA the research used the hospitals' own system of standardisation.
The report said the real (inflation adjusted) cost per output rose around 18 percent from 2000 to 2006.
In the same period the productivity of medical personnel dropped 15 percent and that of nurses fell 11 percent.
The average personnel costs for hospitals increased around 16 percent.
Dr Graham Scott, former secretary to the Treasury and former chair of the Health Funding Authority, who arranged the study, said the purpose of the study was to stimulate research and discussion. It was not an attack on health policies.
In his foreword Dr Scott said many important questions were raised as the report was compiled over the past two years.
"How much of the deterioration in productivity reflects quality improvements?
"Are there time lags that mean increases in unit costs today will result in improvements in productivity in the future?
"What are the real reasons behind the deterioration in productivity and value for money?"
Dr Scott said the downturn in productivity seemed to coincide with the abolition of Regional Health Authorities acting as purchaser-providers of healthcare services.
Mr Kerr said it was surprising how little attention the issue of value for money had received, given the public hospital system represented nearly a fifth of government spending.
"Understanding the true value of spending in the public hospitals sector is not only critical for meeting health sector goals but also for fiscal policy and improvements in the wider economy."
He said the report would be kept up to date and said Statistics New Zealand could also be used to monitor performance.
"Besides stimulating further research, it is hoped the report will help refocus public debate on problems with the performance of the heath system and the alternative policy approaches rather than be confined to calls for more health spending, some of which may represent poor value for money," Mr Kerr said.
Spokespeople from the Ministry of Health or District Health Boards could not be contacted for comment due to an embargo on the report's release.
