The team helps prevent and detect fraud. Photo / RNZ
The team helps prevent and detect fraud. Photo / RNZ
Health NZ proposes cutting 23 jobs from a team that audits and accredits healthcare providers.
The Public Service Association warns this could lead to increased fraud and higher accreditation fees.
Former chairman Rob Campbell called the proposal “disgraceful” and “extremely risky”.
By Keiller MacDuff of RNZ
Health NZ is proposing slashing jobs from a team that brings in millions of dollars a year for the Government. The team also audits and accredits hospitals, rest homes, residential disability and other community providers to ensure they meet safety standards.
The audit assurance and risk restructure would cut 23 jobs – almost a third of the workforce – from a team dedicated to clawing back over-payments, hunting down fraud, and auditing and certifying the safe provision of care in hospitals and community-based services.
The team is made up of staff who work in audit, accreditation, risk management and the health payment integrity team (HPIT).
The Public Service Association said the HPIT identified and prevented fraud in the $10 billion primary care, disability and community services budget. The PSA estimated at least 3% or $300 million was lost each year because of civil and criminal fraud and error.
It said each member of the HPIT recovered $430,000 a year after costs – about a $6 return on investment for every $1 spent – and called the proposal “penny wise, but pound foolish”.
The proposal would also disestablish the certification audit team.
This would effectively create a private monopoly on certification, affecting community-based small providers like rest homes, residential mental health and disability care that would face higher accreditation fees, the union said.
PSA national secretary Fleur Fitzsimons said the proposal was the most “blatant example of false economics” and made no sense to cut “highly skilled and specialised roles that bring in so much money for struggling health budget”.
She said the auditors and investigators “more than pay for themselves” by uncovering and investigating fraudulent transactions and mistakes, and that any cost savings from job cuts will be lost through errors, overpayments and fraud that goes undetected.
Fitzsimons said HPIT had already lost critical expertise, with five positions through vacancies not filled and voluntary redundancies since the restructure began in the middle of last year.
In their submission on the proposal, union members said there were dozens of unassigned files that had been triaged as requiring investigation but were unable to be allocated as staff struggled to cope with the existing workload.
Expertise misunderstood
The proposal demonstrated a failure to understand the expertise required in the role, she said.
“HPIT investigate health professionals to a criminal prosecutorial standard. It’s highly specialised work and needs to be treated as such.”
The potential loss of three of five administrative roles would also impact the bottom line, she said.
“The loss of administrative specialists throughout our health system, including here, is dangerous. It puts more work on other people and that means something has to give. We will see less criminal fraud investigated and uncovered as a result of these change proposals.”
Fitzsimons could not confirm whether the PSA was considering taking legal action around the job cuts but said the union would “be doing everything it can to oppose the changes”.
In an Employment Relations Authority case this year, Health NZ abandoned restructuring efforts in the National Public Health Service, Data & Analytics, and Community & Mental Health teams.
Health Minister Simeon Brown said Health NZ was going through “a range of processes” to make sure they were “rightsizing the bureaucracy” with a focus on front-line services.
Asked about cutting positions that made money for the Government, Brown emphasised the restructure had yet to be finalised.
“The reality is the public service union is doing its job, which is basically trying to protect bureaucracy, we’re focused on front line service delivery.”
Former chairman of Te Whatu Ora, Rob Campbell, called the proposal “disgraceful” and “extremely risky”.
He said the health system has one of, if not the most, complex payment system in the country, granting about as much money to the private sector as it spends itself – a function controlled by the audit assurance and risk team.
Rob Campbell says the proposal is risky.
Campbell said the service had demonstrated “over and over again” the cost of operating it was “far outweighed by the benefits that flow back from the controls they create”.
He said the proposal underscored the direction the Government’s health reset had taken.
“I think it just shows that the process that health is going through is one which is not driven from the interests of consumers, users of the health service, taxpayers, anyone really. But the people managing the system who are striving to meet arbitrary political targets and not actually trying to, or succeeding in, delivering health services people need at costs we can afford.
“This whole thing is getting, in my opinion, quite out of hand.”
Campbell said it was hard to know whether Health NZ was unaware of how valuable the team is to the bottom line, or knew but was intentionally pushing to privatise more functions.
“You’ve always got a choice between is this a conspiracy or is it a cock up - I think the balance swings both ways here.
“There are definitely people who are intent on increasing privatisation of the health system ... but equally I think in the rush to meet arbitrary targets and to be seen to be doing things which are cutting costs and promoting so-called efficiency, I think people are also making cock ups.”
A Health New Zealand spokesperson confirmed the proposed loss of 23 fulltime equivalent roles across the audit assurance and risk team, but said it could not discuss details until final decisions are made.
The majority of the “change process” across the organisation should be completed by the middle of this year, he said.
