The relationship between increasing spend on healthcare and the level of value as a result has been examined with no evidence of direct or consistent correlation. Photo / Supplied, File
The relationship between increasing spend on healthcare and the level of value as a result has been examined with no evidence of direct or consistent correlation. Photo / Supplied, File
Opinion
OPINION
Whether health systems will be financially sustainable into the future is a hot topic in New Zealand and across the world.
The pandemic has intensified the strident and relentless message of alarming cost pressures resulting from a combination of advanced technologies, novel communicable diseases, rapidly growing older populations andrising consumer expectations.
This tension between the forecasted escalating cost of healthcare and constrained financial resources has never been more pivotal, with the current trajectory of accelerating healthcare costs unlikely to be maintainable.
The conventional way of thinking appears to be that the best way of dealing with growing health service demand is to increase funding. The relationship between increased healthcare spend and the level of value derived has been examined and no direct or consistent correlation revealed.
In this context, value is characterised as access to care, quality of care or health outcomes. Therefore, it is perhaps more constructive to think about enhancing the value the health system yields before robotically providing more funding.
This, of course, does not preclude funding increases where they are clearly required, rather, it challenges the principle that they are the only and inevitable option.
Placing the spotlight on value is helpful as it highlights the potential health gains from shifting the emphasis of health spend more quickly to disease prevention, doing more with the resources already deployed within the system and stimulating a more rapid uptake of digital health technologies.
The most common and costly health conditions in New Zealand are the most preventable, yet despite the undeniable effectiveness of disease prevention the health system has not enabled this to anywhere near the level required.
The health sector has only a modest record of productivity gains and consequently there is considerable potential to do more within the current system.
In recent years, the health workforce has increased significantly without proportionate productivity gains and, on a comparative basis, New Zealand's expenditure per hospital bed is significantly greater than the OECD average.
This in no way implies those working within the health sector are not unquestionably committed and very busy, rather it reveals an overly fragmented and less than optimally coordinated sector moderating their best efforts.
The abrupt onset of the Covid-19 pandemic compelled health providers to rapidly recalibrate their mode of operation. In doing so, many fast-tracked the adoption of digital health technologies to provide continuity of access for their patients.
There is significant opportunity for healthcare providers to permanently expand their footprint in the digital health world and create even more options for providing better value healthcare.
Dr Lester Levy. Photo / Supplied
Evidence from the OECD reveals that up to 20 per cent of health expenditure could be directed to more effective use and thereby better health outcomes.
There are choices to be made and, by addressing the underlying problems rather than the symptoms, much more healthcare can be delivered.
A value-based approach to healthcare has the potential to seize greater control over the cost curve into the future.
The perfect place to start is ensuring more value is derived from those resources already embedded in the system.
• Dr Lester Levy has more than 30 years of high-level governance and management experience across the public and private healthcare systems in New Zealand.
