Health NZ's financial deficit blows out to $934m

Health New Zealand's financial position has continued to worsen, according to its latest quarterly report.

However, wait times are showing some improvement.

For the year to June, the deficit (from preliminary unaudited results) has now blown out to $934 million - a dramatic downgrade from the $299m surplus forecast in quarter three.

Chief executive Margie Apa said the gloomier outlook was partly due to one-off factors including write-offs to surplus Covid-19 stock, Holidays Act remediation, cuts to Hauora Māori funding, unbudgeted staffing costs and "higher outsourcing across all employment groups".

"We are committed to resetting Health NZ to ensure that every hour and every dollar we put into our services are adding value to patient care and community wellbeing," she said.

The report shows:

• Immunisation coverage at 24 months (target): 76.5 percent, slightly down from 77.2 percent in previous quarter;
• Shorter stays in emergency departments: 71.2 percent, up from 70.1 percent (target is 95 percent discharged within six hours);
• People waiting more than four months for a first specialist assessment reduced by 1.9 percent and, for a procedure, reduced by 3.7 percent compared with quarter three;
• Cancer patients starting treatment within 31 days: 83.5 percent - up from 82.7 percent;
• The proportion of under 25-year-olds seen by specialist mental health services within three weeks of referral up 4 percent;
• Newborn immunisation enrolment increased;
• Increase in "long waiters" (people waiting more than 365 days for a procedure) to 2930, up from 2858 in the previous quarter.

"The health target to shorten waits to less than 120 days is key but we will continue to monitor to ensure we do not lose sight of long waiters," Apa said.

Other "highlights" included the opening on 30 June of North Shore Hospital's new surgical building Tōtara Haumaru, with 2000 elective surgery procedures planned to take place in its first year.

Preparations also began for delivering new cancer medicines to about 175,000 patients in the first year from 1 October.

Health Minister Dr Shane Reti said the report demonstrated "encouraging progress" against the government's health targets, which came into effect on 1 July.

"The latest report shows that while there's still work to do, and I acknowledge that quarter-by-quarter we will expect variation, Health New Zealand is already making progress on four out of the five health targets," he said.

"This clearly demonstrates the value and the need for targets in the health system, as we're seeing stabilisation of numbers that have fallen in the absence of a clear focus on performance over the last six years."

The minister said he was particularly pleased to see the improvements in cancer treatment times.

"As the system prepares to implement new cancer treatments coming online from 1 October, starting with Keytruda, I expect New Zealanders' access to cancer treatment to improve even more in the coming months."

More than 61 percent of patients received planned care within four months, which meant 1519 fewer people waiting for surgery, he said.

"However, while people are waiting less time for treatment, they're still waiting too long to be assessed, with only a small improvement in the wait times for a first specialist assessment."

The reduction in immunisation coverage this quarter partly reflected an increase in the accuracy of Health NZ's reporting, with the move to the Aotearoa Immunisation Register.

However, the government wanted to see more action to boost childhood immunisation rates.

"Too many Kiwi kids are getting ill with vaccine-preventable diseases."

Fixing Health NZ's "significant financial issues" remained a key focus for the government.

"Our health targets are ambitious and this is not something that we can turn around overnight. However, today's results are promising and I am confident that New Zealanders will see a real difference in access to quality healthcare."

Te Whatu Ora's dire financial outlook (a projected $1.4b "overspend") was the stated reason for the minister's decision in July to dump its board and replace it with a Commissioner, Dr Lester Levy.

At the time, Reti said Health NZ had been exceeding its budget by as much as $130 million a month for the previous five months, despite a 6.2 percent increase in funding in the May budget.