Health group faces repayment deadline

A health group under fire for misspending more than $100,000 of Government funds has until next month to repay the money.

Failing to meet the deadline is likely to signal the end of Te Kupenga A Kahu, which is already grappling with the departure of 5500 patients.

Last week it was revealed the Rotorua-based Primary Health Organisation used $102,000 earmarked for health services on operational costs.

A consultant's report highlighted concerns about the group's leadership and financial management and the Lakes District Health Board is trying to recover the money.

It was hoped the issues would be resolved before Christmas but it is believed Te Kupenga A Kahu has until the middle of next month to pay, after an earlier deadline was extended so further arrangements could be made.

The PHO was given payment options, which included instalments and asking iwi for a loan.

Its chairman, Pihopa (Bishop) Kingi, said the PHO was working to repay the money but had to wait until the New Year to finalise details. The repayment issue has heightened the board's concerns about Te Kupenga's ability to continue operating, after Korowai Aroha pulled out of the group, taking 5500 patients with it.
Korowai Aroha and two other Maori health providers - Tipu Ora and Te Runanga O Ngati Pikiao - formed the PHO in April last year. Like the district's other PHOs - Health Rotorua and Lake Taupo PHO - it was set up using Government money aimed at slashing the cost of visits to the doctor.

Government funds are administered by the health board, which gives each PHO money for health services and operational costs, based on patient numbers. The loss of Korowai Aroha's patients means Te Kupenga will be given even less money than before.

Signs of the PHO's financial woes began to show in October last year when Korowai Aroha general manager Ngaire Whata expressed concern about the funding formula.

This year the Ministry of Health commissioned a review of smaller PHOs and their management services. Details of the report and its recommendations have not been released but it is understood to have highlighted the financial hardship faced by those with fewer than 20,000 enrolled patients.

The ministry's chief adviser of general practice, Dr Jim Primrose, said small PHOs would benefit from shared management services but the ministry would never force them into mergers with larger PHOs.

- NZPA