The full memo from HNZ warned it might be “tempting” to aim for “speedier” cuts to wait times, but that going too fast risked significantly distorting the system in four ways.
“Any degradation of the ability to maintain staffing in public will significantly threaten overall production and hospital flow, including for acute work.”
This was blanked out of the Brown memo, as were all the details of all four risks.
One risk the unredacted memo showed was the loss of specialist surgeons, anaesthetists and medical imaging technicians from public health to private hospitals. Technicians had already been lost “as the private sector dramatically enhanced salaries to attract staff”.
If the new outsourcing push also led to loss of staff, “waiting times for cases not suitable for outsourcing will likely increase”.
These unsuitable cases were the complex ones, “particularly cancer surgery”. Private hospitals typically do more simple operations.
Another risk was “degradation” in training junior doctors publicly. If simple operations shifted to private, that was where the bigger training opportunities would be.
The full memo went on to list 13 ways to deal with the risks, but the Brown memo blanked out all but one of these.
His version detailed the “perceived advantages”, including shorter wait times, but with “important” caveats around retaining public staff, making consistent decisions about care and how the extra more outsourcing might not cut costs.
The memo was written a week after the Government announced in early March it was “partnering” with the private sector.
The memo said the committee stressed there was “no reason to delay outsourcing whilst mitigations are established”, but that HNZ should crack on with those mitigations.
HNZ expects to have had almost 6000 extra procedures carried out in private hospitals between February and June under this approach, and about 4000 in public hospitals.
But even the redacted memo made it clear the Government faced a difficult balancing act – “A collaborative model only exists if labour is not transferred to the private sector as a net loss to the public sector,” it said.
The full memo made this even clearer, discussing various ways the “destabilisation of public resources” could occur.
A lot depended on the rigour of the outsourcing contracts.
“Unless the contracting processes establish clear safeguards, a sudden dramatic increase in private contracting risks loss of full-time employment [FTE] and expertise from public,” said the March memo, in a part blanked out by Brown.
The Government has begun signing multi-year contracts – to “end the use of expensive ad hoc, shorter term” ones – and setting up various “panels” of private providers on standardised terms per medical speciality.
Southern Cross already had a panel deal for surgeries in the north, and extended this to many other places in December. It was working on other panel deals to cover endoscopy and ophthalmology, papers said.
The March memo said the contracts would need to ensure surgeons did both private and public work.
Plans to “recruit, share and train staff” with private hospitals were crucial, although a new funding deal for training had yet to be struck, said a second March document.
Private medical providers – such as Infratil, which owns radiology facilities – have been pushing for longer contracts for several years.
Blanked out
About half of the Brown memo’s four pages were blanked out, on the grounds of protecting confidential advice given to ministers, and officials’ ability to give “free and frank” advice.
RNZ’s Anusha Bradley reported on it yesterday, without access to the full memo.
The memo was signed by the chair of the health workforce and system efficiencies committee, Dr Andrew Connolly, who is close to the front line.
Bradley has asked the minister to review how much information was withheld, arguing Connolly was a professional providing his opinion on an important issue of public importance.
Brown said on Tuesday evening it was “standard practice to redact free and frank advice from officials”.
“They express a range of views to me, and outline risks and issues. That is part of the exchange needed between ministers and officials,” he said in a statement.
Maximising delivery to patients through both public and private services was critical, he added.
‘Training is becoming unbalanced’
The March memo said more junior doctors must be trained as specialists to cover for their colleagues training in private hospitals.
“Otherwise, both acute and planned public work will be adversely affected.”
There was already “concern that training is becoming unbalanced” by the amount of simpler surgery being outsourced, that offered great opportunity for training, said the second document.
This included obstetrics and gynaecology, plastic surgery and otorhinolaryngology.
“Orthopaedic surgical training has been particularly impacted by our increased outsourcing over the past few years”, leading to an agreement in late 2023 for more training in private hospitals.
Private radiology companies have talked about doing more training to help the public system where several hospitals have lost so many senior doctors they had to stop or pause some types of specialist training in recent years.
The second document was a briefing for Brown before meeting the country’s leading private hospital group, Southern Cross, in March.
Southern Cross would probably raise the issue of the current volume of outsourcing to it by HNZ dropping in the Auckland region due to more surgery going on at North Shore hospital, the briefing said.
Health NZ was “quickly developing relationships at regional and district levels” with Southern Cross, it said.
-RNZ
