Ministry of Health using old Census data to work out DHB funding

Health Minister David Clark. Photo / Mark Mitchell

District health boards around the country facing financial uncertainty nearly eight months into the financial year have a fresh problem after the Ministry of Health confirmed it was calculating their funding based on population data that is six years old.

The ministry is using population figures from the 2013 Census to work out funding for the cash-strapped DHBs because 2018 Census data is not yet available.

A spokesperson for the Ministry of Health told the Herald the population projections used to work out DHBs' share of funding were updated annually by Statistics NZ, incorporating other data as well.

"This approach will apply to all DHBs as part of the usual population-based funding formula model for calculating the funding envelope. Given that we cannot yet use the 2018 census data, the ministry is comfortable using the projections based on the 2013 Census. When new data from the 2018 census is available it will be included in the funding formula," the spokesperson said.

DHBs are bulk funded and their share of funding is allocated based on population.

The release of the 2018 Census has been delayed a number of times because of gaps in the information due to a low response rate. Stats NZ is due to give an update on the release in April, just weeks before the Budget.

Health Minister David Clark said today he had been told the 2013 Census data was reliable.

"The projections, I'm told, are robust. It is the best data we have. It's the data we're using."

Clark said there were challenges with using older data but "I'm yet to meet a DHB who thinks it has the benefit of statistics that are in its advantage. All DHBs work within their limits. Most of them think they would like a little more funding if at all possible".

Clark also confirmed that a maximum level of growth imposed on DHBs' population-based funding to smooth out funding increases was removed at the last Budget and would not be in place in the 2019 Budget either.

Stats NZ senior demographer Kim Dunstan told the Herald he was confident population projections were accurate.

Data such as births, deaths and migration data was incorporated into DHB updates each year.

Population estimates were also higher than the Census count because adjustments were made for a portion of the resident population that may not have been counted during the Census, such as those who were out of the country, Dunstan said.

But he acknowledged there was always a degree of uncertainty in any population, which is why a Census was run every five years.

National's health spokesman Michael Woodhouse said he would have little confidence in the population estimates, saying they would not take into account the complex health needs of the people living in DHBs' catchment areas.

"They're not only going to have to make projections about raw population, but how it's aged, their ethnicity, complex needs and socioeconomic factors are all taken into account when devising the population-based funding formula," he said.