Government urged to spend more to save health dollars

By MARTIN JOHNSTON health reporter

The economic and treatment costs of asthma and diabetes would drop sharply if thousands more patients were treated and treated well, a report on the health system says.

The PricewaterhouseCooper's study published today offers the Government a way to check for the most efficient ways to treat many diseases.

Written for the Researched Medicines Industry Association, it focuses on how the public system could more efficiently treat more people with asthma or type 2 diabetes.

It says extra spending now to find and treat more patients, and manage existing ones better, would pay huge dividends for the economy. Benefits would include reduced work and school absenteeism, greater productivity from well workers and fewer hospital admissions.

Many adults with severe asthma or type 2 diabetes leave formal paid work altogether to go on a sickness benefit. Several children each year are held back in school because of asthma, the report says.

Unlike state health studies of how sick people become with various conditions as a way of dividing up health dollars, the report advocates including lost productivity and tax money in the equation.

The Health Ministry welcomed the report's contribution but was sceptical of its conclusions.

"I would anticipate New Zealanders expect health services to be delivered on the basis of need, not on the basis of whether or not their particular condition is associated with lost productivity or lost tax revenue," said a deputy director-general of health, Dr Gillian Durham.

Asthma and diabetes groups are pleased by the report's emphasis on early detection and treatment.

It charts the likely benefits of implementing asthma treatment guidelines and following leading district health boards' diabetes management methods. It urges use of its "added value" analysis for checking how best to spend money in treating conditions ranging from mental illness to cancer.

Total state-financed treatment costs would rise in asthma, the report finds, because more sufferers would be reached, but economic and treatment costs per patient would drop because of factors including better primary healthcare.

More than 600,000 people are believed to have asthma, but the report calculates that only a third of them are receiving treatment.

The researchers, led by health economist Suzanne Snively, estimate that the cost of treating the average asthma patient in 2010 could be slashed from $9550 under present policies to $3370.

They predict that the costs of asthma to the economy, including state-financed drugs and hospital care, lost productivity and lost tax, are on track to reach $2.2 billion in 2010, but could be pruned to $1.93 billion if the guidelines were implemented. In diabetes, they predict savings of 9 to 13 per cent.

The present mix of diabetes treatments and services is compared with the approaches of two district health boards: Counties Manukau, which tries to reach patients at high risk of developing complications such as heart disease, and Hutt Valley, which emphasises the annual free check for diabetes patients - a national programme used by fewer than 50 per cent of patients in some areas - to reach as many as possible.

Industry association chief executive Lesley Clarke acknowledged that her drug company members stood to benefit from the wider use of medicines implied by the report.

Research, Science and Technology Minister Pete Hodgson said the report made some controversial assumptions, which weakened it, but the Government remained open to possible new approaches on health.

Asthma and Respiratory Foundation chief executive Jane Patterson said the group still pushed for the Government to pay for yearly checks for asthma patients - like the Australian scheme that gave patients three free checks a year.

Diabetes New Zealand said the report reinforced the 2001 analysis it commissioned from PricewaterhouseCoopers, which said spending on type 2 diabetes treatment would spiral if the Government did not take measures such as mass screening for the disease.

President Russell Finnerty said the Government seemed unaware that the incidence and expensive complications of type 2 diabetes could be prevented.

Ministry chief clinical adviser Dr Sandy Dawson said research on mass screening for type 2 diabetes showed that it would not be cost effective, although local schemes for at-risk groups in Northland and Gisborne were being developed.