Private hospitals are to be given a greater role in carrying out taxpayer-funded elective surgery under a Government plan to treat more patients.

The aim is to get better prices by smoothing the flow of patients and increase the number treated.

Private hospitals already do about 6 per cent - around 7000 patients a year - of the elective operations and investigations that are funded by district health boards and say they could do significantly more.

In Auckland, nearly 11 per cent of DHBs' elective surgery and investigations such as colonoscopies were done by the private sector in the past financial year.

Health Minister Tony Ryall said last night that the Government did not have a target amount of contracting-out. The intention was simply to increase the number of patients seen.

Prime Minister John Key said health boards would be allowed to enter long-term contracts with private hospitals for elective surgery, rather than turning to them as a "last resort".

He said the previous Labour Government would turn to the private sector only when it was trying to wipe its waiting lists for operations. This meant private hospitals sat dormant, and then once called upon in desperation were able to charge a premium for services.

"As a general rule we are not trying to undermine the public sector, we are trying to complement it."

The change in protocols was part of National's election policy to reduce hospital waiting lists by "the smarter use of private hospitals".

Mr Key said the Government would still fulfil its election policy to build 20 new elective-surgery theatres, costing about $180 million.

It is not clear how much DHBs spend on private-sector electives. Based on the average price paid by Auckland's boards last year of $5064 for work ranging from cataracts to heart surgery, contracting out 7000 patients nationally could cost $35 million.

The Private Surgical Hospitals Association's president, Terry Moore, said there was "significant spare capacity" to do more DHB-funded work.

Labour's health spokeswoman, Ruth Dyson, said the party had never been opposed to taxpayer-funded elective surgery being done in the private sector, but "it must not undermine the public sector".

Ian Powell, director of the senior doctors' union, said contracting out to the private sector ran the risk of staff following because of the better pay rates, compounding the workforce shortage in the public health system.

The Public Health Association (PHA) said the Government was missing the point.

"Encouraging DHBs to enter into longer-term arrangements with private hospitals isn't dealing with the real issue," said PHA national executive officer Gay Keating.

"What we need to be doing is keeping people healthy, by sorting out little health problems before they become big problems.

"About one in five hospital beds is taken up with someone whose illness could have been prevented."

- With NZPA