Health Crisis

The Canterbury District Health Board is responsible for providing health care for the people of Canterbury, New Zealand. Many of their activities are focussed on Christchurch Hospital.

In the last few weeks, seven members of the Executive Team have resigned for their positions, including the CEO, CFO, the Executive Director of Planning and Funding, the Chief Medical Officer and the Executive Director of Nursing. They have been cagey about their reasons for leaving, but the word on the street is that they are tired of the pressure to make extreme budget cuts that is being put on them by the government-appointed chairman of the board. There is a budget hole, but the executive team have been saying that it is impossible to make deep cuts in expenditure without cutting services. The Board does not seem to have been listening to what they have been saying.

The loss of two-thirds of its executive team would be a serious problem for any large business organisation. Many large businesses get rid of their CEO, but they keep the people in the key roles under the CEO to ensure continuity of business. We are in the middle of a health crisis. Allowing half the executive team of our major health provider is a serious failing by the Board. I would love to know the answers to the following questions.

• Why has the Minister of Health been silent about what is happening, given that the financial pressure comes from the government? After the latest resignations, he said he still has confidence in the DHB’s board. How can he have confidence in a board that has lost most of its executive team?

• Why have most of the elected members of the board mostly remained silent. The executive staff who have resigned cannot speak, because they are still in their roles. However, the elected members must know what is going. Why are they not speaking to the people they represent and obtaining their views? Are they scared the government will remove them from the board and appoint a commissioner?

• The chairperson of the board says that appointing a new executive team will bring in a “fresh” and “outside view”. That is a joke. The executive team of every large organisation needs to be replenished regularly to ensure that it remains fresh. However, this is better done gradually. If a large number of executive staff are all appointed at the same time, they will spend the first year learning their roles and getting to understand their new organisation. This will be hard, if the rest of the executive team are new and feeling their way too. They will struggle to make radical changes while they are becoming familiar with their organisation and their role in it.

• Why is the Chairperson of the Board not speaking to the public he is supposed to be serving, or the news media? Why has he only spoken to a coffee club run by an ex-mayor? The people of Canterbury deserve to hear from.

• No doubt there are savings that can be made in the health system. That is true of any large organisation, but it is unlikely that the Board or the executive team will find them because they are too far away from the day-to-day organisation to know where they are. The efficiencies will have to be identified by the middle managers who understand what is going on.
  

  • Service managers will have to stop being yes men or women and remember that they are responsible for spending money that is taxed from people on the minimum wage, and not on big salaries like them. They are the ones who should be able to find the inefficiencies and advocating for better solutions, not protecting the status quo.
  • Clinical directors will have to ensure that all their clinicians are fully active during and working effectively during the time that they are being paid, and not skiving off to make money running their private businesses.

• The new clinical services building for Christchurch Hospital is two years late being finished, so why is everyone responsible for this fiasco still walking around smiling. These delays have created huge problems for delivering health care in Canterbury. The contractors building the new building don’t seem to have suffered any penalties, despite serious mistakes being made. The Ministry of Health project managers who were overseeing the project do not seem to be accountable. The Director-General of Health who has overall responsibility seems to be ignoring the problem.

• Why do the news media keep saying that the hospital services are moving into a “shiny new” building? Based on previous experience, they will enter a building with hundreds of defects that the contractors will be reluctant to fix. These problems will make life difficult for the people working in the new building. And because the building took so long to be built, like the maternity services building, it will be too small and out of date by the time it goes into use.

• Why does a retired court judge assume that he knows more about delivering health services than a CEO who has been in the role for many years and his respected all around the world?

• I am concerned that the members of the executive team seem to be feeling bullied the Chairman of the DHB. Bullying seems to be a huge problem in the health sector. A report released last year said that 60 percent of staff at another DHB had experienced bullying. How can this bullying be stamped out, if bullying is taking place at the top level of the organisation?

• Why has the Prime Minister been so slow to deal with the problems at the DHB? Hospital clinicians have written to her twice expressing their concerns about what is happening, but she seems to be ignoring them. If their arguments are incorrect, why has the Health Department not been able to refute them? I presume the Prime Minister assumes that Labour already holds most of the Christchurch seats, so the city can be ignored.

• Why does the government not fund health care adequately? With an aging population and emerging health technologies the cost of health care is going to rise dramatically, yet successive governments choose to control healthcare but have continued to underfund it.

• Why does the government still use Census of Population data to distribute health funding when health needs are not distributed evenly across the population. The Health Department has masses of data about the incidence of sickness and the need for surgery. They know about everyone who is sick or infirm. They should be using this data to allocate health funding where it actually needed. An allocation based on population numbers seems to be a lazy option, even if adjustments are made for age, etc.

• One reason for the budget deficit is an increase in capital charge as a result of the completion of the new clinical services building. This does not make sense. A business that creates extra capital can expand the range of services it makes or products it produces to earn extra income. This enables it to pay a return on the capital used. In contrast, when a public hospital that provides its services free gets a new building, it cannot deliver more services to earn more income. Instead, it has to continue to deliver the services that it was previously delivering in the old building. It is unlikely to get extra income to cover the cost of the capital charge. Why is an artificial accounting practice putting the delivery of health care at risk?

• A new clinical services building may allow some efficiencies, but it will be unlikely that they can be captured quickly. Rather the new building will probably provide a better-quality experience for patients, but because they do not pay for the service that they receive, the better service does not result in increased revenue.