The report describes an underfunded, fragmented system facing more than twice as many over-85s by 2047. It recommends paying providers enough to build beds, more home care, an independent pricing authority and higher contributions from people with assets.
Everyone at the table thought it common sense, and I have yet to hear any politician disagree.
But that raised the obvious question. If it is common sense now, it was common sense ten years ago, so what has stopped governments preparing for an ageing society?
Without enough rest home beds, frail old people stay with exhausted families or in hospital.
A hospital bed costs taxpayers about $1,750 a day, a rest home resident around $80. But the government sets the price of a standard rest home bed and caps what residents pay at that rate. That price has not kept up with costs, so too few get built. The report would let prices reflect costs and help those who cannot pay, rather than hold prices down for everyone.
Underpaying providers is a false economy. On the report's figures, even building enough capacity under today's rules to give more than 9,000 people a bed would cost just $190 million a year more by 2037/38 than letting the shortage grow.
The report assumes people without a bed spend a tenth of their wait in hospital and need home care and hospital trips for the rest. Each person left waiting costs $59,000 a year more than a rest home bed. By 2047/48, not building costs more than building.
Older people waiting in hospital would take up five percent of hospital capacity by 2037/38.
Politicians tolerate this because hospital costs are hidden. They turn up as emergency department queues and cancelled operations, which voters blame on Health New Zealand. Paying providers more is a visible decision. So is deciding what those with assets should pay.
Here the agreement stops. Associate Health Minister Casey Costello wants a 'really honest conversation' but would not be drawn on who counts as wealthy enough. Her party, New Zealand First, lists 'asset protection' among its priorities.
A rest home takes five years to build. The Parliament we elect on 7 November decides what we have in 2031.
If that Parliament does not choose rest homes over hospitals, the result will be longer hospital waiting lists.
Dr Oliver Hartwich is the Executive Director of The New Zealand Initiative think tank. This article was first published HERE.
But that raised the obvious question. If it is common sense now, it was common sense ten years ago, so what has stopped governments preparing for an ageing society?
Without enough rest home beds, frail old people stay with exhausted families or in hospital.
A hospital bed costs taxpayers about $1,750 a day, a rest home resident around $80. But the government sets the price of a standard rest home bed and caps what residents pay at that rate. That price has not kept up with costs, so too few get built. The report would let prices reflect costs and help those who cannot pay, rather than hold prices down for everyone.
Underpaying providers is a false economy. On the report's figures, even building enough capacity under today's rules to give more than 9,000 people a bed would cost just $190 million a year more by 2037/38 than letting the shortage grow.
The report assumes people without a bed spend a tenth of their wait in hospital and need home care and hospital trips for the rest. Each person left waiting costs $59,000 a year more than a rest home bed. By 2047/48, not building costs more than building.
Older people waiting in hospital would take up five percent of hospital capacity by 2037/38.
Politicians tolerate this because hospital costs are hidden. They turn up as emergency department queues and cancelled operations, which voters blame on Health New Zealand. Paying providers more is a visible decision. So is deciding what those with assets should pay.
Here the agreement stops. Associate Health Minister Casey Costello wants a 'really honest conversation' but would not be drawn on who counts as wealthy enough. Her party, New Zealand First, lists 'asset protection' among its priorities.
A rest home takes five years to build. The Parliament we elect on 7 November decides what we have in 2031.
If that Parliament does not choose rest homes over hospitals, the result will be longer hospital waiting lists.
Dr Oliver Hartwich is the Executive Director of The New Zealand Initiative think tank. This article was first published HERE.
2 comments:
Yes, I agree with the general thrust of that Oliver. You've identified the inefficiencies of housing elderly people in hospital rather than rest homes. However I'm disturbed by the recommendations of the report prepared by the Selwyn Foundation chaired by former Labour health minister David Cunliffe. It's the socialist command economy all over again - the State makes the rules, funds the industry, manages the outcomes, and taxes the rich. In reality, the market fulfills the function much more efficiently. If there is sufficient demand for low-cost residential retirement villages, the private sector will fill that void. I was friends with an old guy who lived in a decrepit old caravan in a trailer park with only social welfare to sustain him. When he could no longer look after himself, we got him into a nursing home. It wasn't Shangri-La, but it wasn't hospital and it was way better than the caravan.
David Seymour opined at a public election meeting for the ACT policy to investigate funding more medicines in the health budget, because medicines were circa only single figure percentage of the budget, yet could save considerably higher doctors , specialists and hospital care .
It seems the same practical use of the health budget has been described by the Aged Care advisory group .
Both discussions show real budget governance which is quite different from governmental authority.
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