Waikato Hospital does not have enough doctors and nurses to run its operating theatres at full capacity, resulting in between six and nine elective surgeries being put off each week.
Because of the staffing shortages the orthopaedic department was behind by 265 cases at the end of last September and its inpatient waiting list was reduced from 585 in January to 387 in November.
That meant patients who had been assessed for surgery were told they did not meet the criteria because the hospital could not cope with the work. In turn the number of people who qualified for surgery was lower.
At the same time that hospital managers were frantically trying to recruit specialist doctors, anaesthetists and orthopaedic nurses to address the shortfall which has constrained the theatres since March last year, they were looking at ways to cut expenses to meet a $43 million savings plan.
In a public excluded report to the Waikato District Health Board on November 23, released under the Official Information Act (OIA), managers said a range of initiatives were needed to address the budget woes including reducing nursing levels.
DHB managers said costs were over budget despite lower than planned for patient volumes and delivery, for two main reasons: only $6.1m of the $43m had been saved, and an increase in full-time nurses.
Nurses were the biggest blowout to the budget at $3m while medical (doctors) were $1.1m.
The cost of nurses' overtime for six months to December last year was $1.2m.
A range of initiatives to remedy the situation included assessing nursing levels to "reduce where appropriate", tightening up nurses' overtime and annual leave, and examining the criteria for implementing watches - where a patient is monitored for an extended period.
DHB executive director of Waikato Hospital Services Brett Paradine said theatre recruitment of nurses was specific whereas reducing nursing costs was spread across the entire hospital.
He said nurses would not be forced to take annual leave unless they had more than two years' worth with no plan to reduce it.
There is also a process where staff can request to cash in leave over the statutory minimums.
The Herald has previously reported that chief executive Dr Nigel Murray cashed in his annual leave as part of his renumeration package.
Paradine said the use of Safety Partners - watches for patients at risk of harm due to dementia or delirium - was being made more efficient and the DHB was considering using family members of the patients to provide the watch instead.
The DHB said in the reports that it did not have enough budget to treat acute cases and deliver elective surgeries required by the Ministry of Health's national health targets, which could result in financial penalties.
Similar problems were occurring in other district health boards including Auckland, and Capital and Coast in Wellington where that DHB was behind on 300 elective surgeries at the end of December.
The backlog was largely the result of a shortage of senior doctors, according to minutes of board meetings at the DHBs.
Association of Salaried Medical Specialists executive director Ian Powell said the situation was dire.
"There is a severe shortage that is camouflaged by the failure of DHBs ... to advertise needed positions and so there's a difference between vacancies and actual shortages."
Powell said DHBs were under financial pressure and relied on doctors working longer hours to cover the shortages.
Labour's health spokeswoman, Annette King, said Waikato patients would be better off moving to Rotorua if they needed surgery.
"They can operate when people are less disabled and less in pain than they can at Waikato."
Health Minister Dr Jonathan Coleman said health funding for the 2016/17 financial year increased by $568m to a record $16.1 billion.
Coleman reiterated previous comments that the Ministry of Health was working closely with Waikato DHB to address its issues in orthopaedics.