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A leaked draft of the review calls for an urgent overhaul of the way the board manages colorectal cancer.
It says limiting access to colonoscopy has gone too far and there is evidence this has had "adverse consequences for patient care".
Undue delay in diagnosis or treatment was found in 10 of 20 Southland cases reviewed.
The auditors, general surgeon Phil Bagshaw and gastroenterologist Steven Ding, say some of the cultural and interpersonal issues within the gastroenterology department and with staff in other departments "have been known to SDHB management for years and were thought by some hospital clinical staff to have impacted on patient care".
In a confidential survey in 2017, 15 senior doctors using the board endoscopy services indicated they were aware of patients they thought had come to harm as a result of having an endoscopy referral declined.
Most of the seven Southland Hospital staff interviewed in the review showed signs of distress and some were on the verge of tears, the auditors said.
The report recommended clinical and management staff should be offered trauma counselling immediately.
Counselling should also be offered to all members of the gastroenterology department "who find the current situation stressful".
Although the Southern DHB population has the third-highest rate of colorectal cancer in the country, the report says the board's poor performance against standards for the management of such cancer indicates serious problems with the control of the disease .
It has one of the highest rates of cancer diagnosed only after it has spread beyond the bowel, one of the highest rates of emergency surgery for bowel cancer, but one of the lowest colonoscopy rates.
"Inadequate resourcing appears to be a major impediment to the SDHB dealing with these problems."
Mr Bagshaw and Dr Ding, both of Christchurch, were brought in to review Southland Hospital surgeons' complaints, made over about five years, regarding restricted access to colonoscopy and continually deteroriating relationships between Southland staff and the gastroenterology department at Dunedin Hospital.
Nobody was named in the report, but the management style of someone referred to as [G] drew criticisms from interviewees in both Southland and Dunedin.
These included often not answering direct phone calls, giving "often demeaning and sparse" email and letter responses, relaying dissatisfaction with performance through incident reports rather than direct communication, failing to hold staff meetings, and intolerance of opposing views.
Concern was raised that tensions between [G] and surgeons had an impact on patient care.
Some Dunedin interviewees said [G] was generally respected, thought clearly and had improved the gastroenterology department.
Concerns were raised by Southland specialists about [G] interfering in the management of some of their cases including telling them what operation was needed and refusing to allow some acute cases to have colonoscopies.
[G] told reviewers he was taken by surprise by the letter of complaint from Southland surgeons (made public last year). He had received some very insulting letters from staff.
He considered Southland Hospital staff could function better with their triaging referrals for endoscopy, they were not co-ordinating referrals properly, there was insufficient oversight of junior staff referrals and there were rostering difficulties.
Dunedin staff expressed concern about the possibility general surgery registrars could lose training board accreditation in colonoscopy because there was a lack of training opportunities.
Auditors were told this compared unfavourably with good opportunities available to local gastroenterology trainees and nurses.
A major cause for the relationship issues was the introduction of guidelines for access to colonoscopy in 2012.
All referrals were assessed in Dunedin and the criteria applied regardless of who referred the patients.
The auditors agreed on the need to deal with old colonoscopy waiting lists that "were out of control".
However, access was now too tightly controlled and there was "evidence this has had adverse consequences for patient care".
The local guidelines, instead of being used to prioritise access, were being used as "rationing tools". (The national guidelines they were based on had been intended to control access from general practitioners and non-gastrointestinal specialists.)
While this was understandable, given underfunding, it meant there was no alternative access for patients unable to pay for private colonoscopies and it inhibited gastrointestinal specialists from exercising their clinical expertise on behalf of their patients.
Concerns about Southland specialists' ability to override the standard referral process seem to have been heard by board management.
Board chief executive Chris Fleming did not wish to comment on the findings before the issuing of the final report, but said in the meantime action had been taken to require an agreement be put in place between the gastroenterology department and general surgery "to have a clear process to allow appropriate gastrointestinal specialist override of the referrals, as well as a review process of overrides by the Endoscopy Users Group".
Yesterday Mr Fleming had not responded to further questions to clarify how far this had got.
(The Endoscopy Users Group is a committee involving medical, nursing, management and administration staff across the district who meet monthly to discuss operational and clinical issues with an emphasis on quality. Concerns were raised with auditors about the way the group has been working, with some describing it as dysfunctional and indicating Southland surgeons were not welcome at meetings.)
Mr Fleming said he was very disappointed about the leaking of the draft report. The draft was provided to all those interviewed for the purposes of allowing them to check the facts and to pass comments back to the reviewers.
"The ability for the report to be developed, reviewed and finalised in a way that allows free and frank exchange, and for the provisions under the Official Information Act to be considered before releasing publicly, is important. This enables us to give people confidence to participate openly in reviews in the interests of patient safety and quality improvement, while balancing privacy and public interest considerations in sharing this information publicly."
At this point he had not received a date for the final report, but had been assured by reviewers they were working on this as rapidly as possible.
Responding to questions about whether the board had been wise to proceed with the bowel screening programme last year when referring senior doctors had raised serious concerns about the endoscopy service in 2017, Mr Fleming said "one should not draw any conclusion between the roll-out of bowel screening and the issues raised in the report".
Auditors said they could not comment on any direct effects the reduction in access to colonoscopies might have had on long-term patient health outcomes or the workloads and cost to other clinical services. They called for research into this.
-Colonoscopy is a procedure which internally examines the whole of the large bowel and allows for the removal of pre-cancerous growths.