Emergency Department use and acute admissions are growing at twice the rate of the population, causing burnout among overworked doctors amid what is described as a "tipping point" for the health system.
Authors of the report Hospitals on the Edge, prepared for the Association of Salaried Medical Specialists, said over half of doctors and specialists across the country were burnt out, and it was the patients who are suffering.
Most of the issues were due to a decade of underinvestment in the health sector amid rapid population growth, they said.
Health Minister David Clark said he agreed there had been underinvestment, which his Government was trying to address, however National's health spokesman Michael Woodhouse said Clark couldn't have it "both ways".
The report found acute hospital admissions and emergency department use were both growing at more than twice the rate of population growth.
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Despite the increase in people seeking treatment, there was still an estimated 430,000 children and adults who have an "unmet need" for hospital care. The authors argued rather than being a saving, this shifted costs to other parts of the health system.
For example because of shortages patients are being referred from specialists back to their general practitioners for monitoring, only to have their situations worsen and end up costing more.
In many hospitals, bed occupancy rates were frequently close to – and sometimes over – 100 per cent. The report also stated New Zealand had one of the lowest psychiatric inpatient bed rates in the OECD, ranking higher only than the United States, Chile, Italy, Turkey and Mexico.
ASMS National President Professor Murray Barclay said he'd been working as a specialist the past 30 years and the current situation was the worst he'd seen.
"All doctors and specialists are reporting bad levels of fatigue, with half stating they are burnt out. That feeds into the type of care they can provide and their availability."
Women were disproportionately affected, with 70 per cent reporting feeling burnt out.
Barclay said this was likely down to ingrained gender biases, and women feeling they needed to work harder than their counterparts.
An ED specialist reported "exponential increases" in patient volumes over the past five years, but no increase in employees.
"Effectively we're being asked to just work harder."
A surgeon said they were routinely cancelling theatre lists due to lack of staff and bed capacity.
"We are running about two months behind target for semi-urgent colonoscopies and are struggling to keep up with the demands of the bowel screening project.
"Short notice stress leave has become more frequent."
Barclay said the reasons for the current situation were varied, but underinvestment and population growth were crucial.
There was a 24 percent shortage of hospital staff within 15 out of 20 district health boards (DHBs), with the biggest shortfall - 36 per cent - in Northland.
Barclay estimated there was a shortage of about 1000 doctors.
While he said he acknowledged the current Government had increased health funding, more needed to be done.
"They have stemmed the flow but are far off the mark."
Barclay said Budget 2019 was about $1.7 billion off the 2010 budget measured against GDP.
Along with funding increases the report also recommended integrating primary and secondary services.
Clark said he agreed there had been underinvestment - something his Government was trying to turn around.
They had increased funding to DHBs, operational funding; and $2.45b to refurbish run-down hospitals and build new ones.
Since coming into Government they had seen 1699 additional nurses, 677 more doctors, 105 more midwives, and 594 allied health staff working in our hospitals.
Clark said growing the medical base would take some time.
"Given it can take up to seven years to train a medical specialist we acknowledge that it will take time to rebuild these workforces, just as it will take more than one or two budgets to address nine years of neglect, but this Government has made a good start."
National's Michael Woodhouse said Clark's assertions were not correct.
"It becoming a broken record blaming the previous government, and it is not correct.
"The previous government put record amounts into the health sector and increased the number of doctors and nurses by about 7000."
Woodhouse said the only person to fix the current situation was Clark.
National would have invested no less - maybe more - than the current Government, he said, but there also needed to be performance and health targets, which Clark removed in 2018.
"Currently there is not an expectation system be more efficient, and I think that is key."
At the time Clark said the targets created "perverse incentives", a view supported by the ASMS.