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Sharing the cost burden of our national health system

19 Jun 2020

hospital equipment

Our CEO, Rob Hennin penned this Opinion Editorial for BusinessDesk regarding the importance of sharing the cost burden of our national health system.

We all know a lot more about our health system than we used to. The covid-19 pandemic, with daily briefings from the Prime Minister and the Director-General of Health being beamed into our living rooms every day for months, has raised the profile of the importance of health. We’ve also learned that without a healthy population, we don’t have a healthy economy.

This week we learned even more with the publication of the New Zealand Health and Disability System Review which clearly signalled the need for greater investment in the health system.

All of which raises the issue of how New Zealand is going to afford putting much more money into health.

Already about 21 percent of our government spending goes into keeping Kiwis healthy. Currently that represents about $16 billion and was already expected to grow to at least $18 billion by 2022. Given recent events and the predictions about our future health needs, that’s likely to increase markedly.

Fortunately, the burden of health costs is already being shared by those who choose to patronise the private sector when seeking elective surgery, specialist or GP visits. That happens through the hundreds of thousands of Kiwis who currently have health insurance.

But there is so much more that can be done.

Private sector ignored The disappointing part of the review is that it ignored the benefits that the private health sector can bring to this massive challenge of making our health system more responsive, more efficient and more effective. The public health system is a very big machine and our hospitals are very good at critical care – but other parts of the system are failing to provide the care that New Zealanders rightly expect and deserve.

Private healthcare can be more nimble, is more innovative and can add huge value to our public system. After the recent lockdown, private healthcare facilities were back on their feet providing elective surgery much faster than the public system, which is still arguing over who should have priority in our rationed elective hospital services.

The model we at nib have developed with Ngati Whatua Orakei through their Toi Ora programme is a great example of private healthcare enhancing health outcomes through partnerships. The programme offers free universal private health insurance to iwi members helping them to not only access and afford the treatment they need but also to empower them to take control of their health and wellbeing through preventative health checks and services.

__Opportunity __

We see a real opportunity for private health insurers to assist in meeting the future needs of New Zealanders by playing a stronger role in facilitating access to healthcare. This will in turn help reduce the ever increasing health cost burden on the government by encouraging individuals to take greater responsibility for their health needs.

Unfortunately, the report’s finding that “the health and disability system must act and be managed as a single integrated system comprising public, private and non-governmental organisation providers” did not progress beyond the expression of this worthy sentiment. A truly sustainable, effective and caring health system needs private sector investment as well as public sector funding. It’s a shame that this wonderful opportunity to engage the private health sector in this massive challenge has been ignored.