Roger Partridge: Health innovators face the structural question
- Administrator
- May 10
- 2 min read
Treasury projects public health spending will rise from 7.1 to 10 per cent of GDP by 2065. Over the same period, the ratio of working-age taxpayers to superannuitants will halve. Something has to give.
The question at this week’s third nib-New Zealand Initiative Health Innovators’ Summit was: “What?”
The answer was different from the two earlier conferences.
In 2024 and 2025, the lesson had been “not to wait for government.” Lloyd McCann’s Tāmaki Health, our largest privately-owned primary-care network, was building team-based care across 52 clinics. Sir Bill English was championing the social-investment ventures, Manawanui and Impact Lab.
The room had been told, in effect, that better operators would have to save the system. Both returned this year, but the conference mood had changed.
Health Minister Simeon Brown opened with recent Government commitments, but was honest about the scale of the problems that remain.
Ezekiel Emanuel, the American health policy academic, told the room New Zealand was “solidly middle” by rich-country standards. The country did not need to spend vastly more, but to spend better – by fixing incentives, infrastructure and information.
Hamiora Bowkett, the government-appointed Crown Observer at Health New Zealand, asked whether compulsory insurance, national, social or private, should fund more of the system. Most high-performing systems use compulsory insurance. New Zealand does not.
Brent Pattison, the new CEO of Heritage Lifecare, argued for aged residential care as step-down infrastructure that eases hospital pressure.
Claudia Wyss, a former health-sector chief executive, made the strongest structural case. She wanted a ring-fenced health levy modelled on ACC, insulating funding from annual budgets. And she wanted a review of the boundary between ACC and Health New Zealand, which funds patients with identical needs differently depending on whether their condition arose from an accident.
Neither is something a primary-care network or aged-care provider can deliver. They are statutory questions only Parliament can answer.
The bottom-up case has not weakened. But every entrepreneur in the room was operating inside funding arrangements not designed for the next forty years.
A fifteen-minute primary-care consultation cannot be funded out of an eight-minute payment. An older New Zealander cannot insure herself in a market that prices her out.
Two years ago, the room was excited about what entrepreneurs could achieve. This year, no one believed it would be enough.
This piece first appeared in the weekly New Zealand Initiative newsletter. Roger Partridge also writes at Plain Thinking
One of my late sister in laws grandfathers was the President of Guatamala. Not a position to be envied
“…funding arrangements not designed for the next forty years.”
Here’s the nub. Health is on the same trajectory as superannuation: the number of New Zealanders who rely on it will increase, while the proportion of taxpayers funding healthcare decreases.
I was impressed by the thinking of the late Prof. Des Gorman, who said New Zealand had “a disease and injury treatment system, not a healthcare system.” It’s a hard problem, because as a society we have determined that we cannot turn anyone away from receiving healthcare - even a criminal on welfare, who has ignored all advice for years and kept smoking and drinking.
The only long-term sustainable solution I see is for something like individual healthcare investment accounts (perhaps…
Need to spend better I think is the phrase that should stand out. The efficiency of Heath NZ is appalling, better infrastructure will help, but only if the information pathways are state of the art. I see every doctor having some sort of “robotic assistant” in the next few years - will decrease a huge amount of the paperwork and offer a “peer review” in real time. Important - keep Labour and it’s bs job rolls away from the treasury
Thanks Roger. I value your clear approach to complicated issues. One other issue that I think is important is the way in which we approach the life cycle, and in particular, ageing. We know that there is significant spend in health dollars towards the end of a person's natural life. This can be driven by the innate desire to live as long as possible and our inability, or unwillingness, to talk openly about quality rather than quantity of life towards our inevitable end. So, part of our health innovation must be to engage geriatricians and older Kiwis in thinking through ways to enhance living with the reality of death and how to limit over enthusiastic practitioners and families from extending…
And the Labour Party want to introduce a Capital Gains Tax for everyone to provide 3 doctors visits a year for the one in 6 of us that cannot afford to pay! It is this insanity that has put this country in the financial mess we now face, look who put Labour in when National had the majority in 2017!