Gareth MorganHealth, Tax and Welfare

The way the limited resources of our public health system are allocated across those in need is increasingly ad hoc and unfair. Because of the lack of a coherent and consistent framework for allocating resources – across conditions, patients and regions – we have an ugly situation where the loudest get served first. Put bluntly, it’s an obscene abuse of universal health care.
Politicians tried, of course, to implement a rationing system via then-health minister Simon Upton’s ill-fated core services committee of 1992, but its approach – to ask the public what it wanted the public health system to provide – was as flawed as asking an infant in a candy shop which sweeties they wanted. They wanted it all and they wanted it now – what a surprise.

Over the subsequent 18 years the problem hasn’t gone away; there are still unmet health needs despite the boom in health sector spending. And the official forecasts are for that demand to keep soaring so the health spend rises from 9.6c in every dollar earned (GDP) to 18c. Such a breakout just won’t happen, so today’s reality – that someone, somewhere in the health system is faced every day with having to ration resources, to decide who gets access and who misses out – is going to get worse.

In large part the actions of that someone, thanks to the abject failure to transparently ration the health dollar in the early 1990s, have been swept under the carpet and the public no longer can have confidence that the rationing decisions are objective, fair, evidence-based and consistent across DHBs. Yet the whole concept of universal entitlement, while it has never meant an “all you can eat” offering from our health system, does depict a system where every citizen should have equal entitlement to whatever services are offered. But the obscurity of how rationing decisions are actually made – and you’d better believe that they are being made but in a way that’s not apparent until you dig – ensures the public hasn’t a clue if such equity or fairness ensues. It doesn’t.

When researching our 2009 book Health Cheque, Geoff Simmons and I were told by numerous professionals inside the system that on a daily basis they are put under undue pressure from patients and their agents (family members, MPs, lobby groups) and the disturbing reality is that the squeaky wheel gets the oil. The typical scenario is when the patient’s people threaten to go to their MP, go to the media and so on unless they get the service they think they deserve, then the system is abused.

Blackmail of busy health professionals like this is offensive but sadly is common, resulting in those with the loudest advocates getting served in front of others, just so the professionals can move on and attend to others. It is wrong, it is unfair but it is the reality – the needs of those without access to strident advocates are being trampled under as the loud lambast their way to the front.

Hardly surprising that over-represented in those being neglected are Maori and Pacific Islanders, although in no way is it restricted to them. Prominent among those bullying their way to the front are those who use well-organised lobbyists such as Age Concern and Grey Power. And the frequency of politicians turning up on TV advocating loudly for some old lady or equally heart-rending case and barking at the Government to respond is symptomatic of the system’s failure.

Last week I confronted one such politician making her mark in this way on television’s Close Up. Such soap-boxers should play no part in how health resources are allocated. The allocation of taxpayer-funded health sector dollars should not be subject to the leverage of lobbyists. The time is overdue to introduce transparency and objectivity into the process of allocating health services and ensuring the whole ethos of universal entitlement is being honoured.

In order to do that, transparency over how the fixed health dollar is allocated is necessary and the process by which the allocation is made has to not just be seen by all to be objective, but has to actually be objective. On both counts this is pie in the sky right now. Yet for the public to have ongoing confidence in our health sector and respect that there simply is more demand for services than resources available to supply them, they must be assured the allocation is fair.

What’s fair? We’d all like to think that those with greatest need are fixed first, but sadly it is not that simple. In a world where all needs cannot be met, society has to decide what “greatest need” is. How do you decide between a 92-year-old and a 10-year-old in need of the same knee operation? Personally they both have equal need so that gets you nowhere, and the limited resources mean you have to make the choice. The 92-year-old has paid more taxes, the 10-year-old has more taxes to contribute, so that doesn’t help decide either.

But we must make a decision, we must decide who it will be. This is the reality facing society and the reality several generations of politicians have run away from. The answer is very clear but we must have the courage to declare and stick to it. The 10-year-old gets the nod because from this point of time society will benefit more from them being fixed – they have far more quality-adjusted life-years to contribute to society than the 92-year-old has. From society’s perspective it’s a no-brainer investment.

At least if it was clear, everyone would know that their entitlements would be diminishing as they age and so they would plan for that in their financial affairs. They would insure or self-insure or accept that being able to do the high jump when you’re 92 is unrealistic. But we’re guilt-ridden; as a society we are too gutless to make that decision explicit. So we abdicate that responsibility and leave it to the ad hoc process, outlined above, to make it for us. The squeaky wheels get their heads in the trough and leave it dry for those without those advocates.

There is nothing equitable about that, nor is it anything that society should be proud of. It has to be changed. Next week I’ll outline how we see the great health decision being addressed and compare our recommendations to those of the Horn Committee.

Gareth Morgan, with Geoff Simmons, wrote Health Cheque, a study of the NZ health system.

BULLIES LEAVE REST BEHIND WHEN IT COMES TO HEALTH CARE. was last modified: December 15th, 2015 by Gareth Morgan
About the Author

Gareth Morgan

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Gareth Morgan is a New Zealand economist and commentator on public policy who in previous lives has been in business as an economic consultant, funds manager, and professional company director. He is also a motorcycle adventurer and philanthropist. Gareth and his wife Joanne have a charitable foundation, the Morgan Foundation, which has three main stands of philanthropic endeavour – public interest research, conservation and social investment.