Published in The Post, 16 May 2025

Two recent announcements by the Minister of Health should prompt a serious discussion about the future shape of healthcare delivery in New Zealand: the call (now closed) for submissions on health workforce regulation; and the release of the Health Infrastructure Plan, which is largely about a future hospital building programme.

The hospital building programme released by the Minister envisages the expenditure of $20 billion for a ten-year programme of essential maintenance, upgrading and expansion. However, it should be seen in the context of an earlier report drawn up by NZIER for the Infrastructure Commission in February 2024 which calculated that New Zealand would need to spend the equivalent of the Dunedin hospital every year for the next 30 years at an estimated cost of $115 billion, which is four times more than we currently do.

The run-down state of Nelson’s hospital, an example of the upgrades required in the sector

This is just to maintain “business as usual”. The authors suggest possible savings, such as greater productivity in clinical output and tackling preventable hospital admissions. One factor not mentioned is that hospitals typically only operate at full capacity for five days a week. How about if that could be stretched to weekends, given the expensive real estate and facilities that are being financed by the taxpayer?

In similar circumstances, albeit with the advantage of a more compact geography, in 2007 Denmark decided to reduce the size of its acute hospital sector and in the subsequent decade halved the number of hospitals, increased the productivity of the sector, kept the cost structure stable, reduced admission and readmission rates, and raised the profile of primary and community health services.

This is where the announcement on health workforce regulation comes in. During my time on the Auckland District Health Board (ADHB) I appreciated the practical impact of the complexity and narrow division of labour present in the allied health workforce. We had no obvious shortage of doctors on staff, but what cramped our style was the shortage of anaesthetic technicians and other similar support staff, largely due to unnecessary restrictions by interested parties.

Another example is the case of physician associates (PAs). This would be another “extender” to professional services, this time in medical practice rather than anaesthetics. Such personnel already exist in New Zealand and the United Kingdom (UK) and operate a bit like nurse practitioners. Unaccountably, they have been subject to some established professional opposition, yet in the UK the General Medical Council describes PAs as medical professionals, allows resident (junior) doctors to supervise them, and has established 36 training courses. Properly deployed they would do much to extend the accessibility and productivity of primary and community health services, as well as hospital care.

So, greater flexibility in the workforce will allow New Zealand, if not to halve the number of acute hospitals on the Danish pattern, but at the very least enhance primary, community, and outpatient and other hospital services. For example, during my time on the ADHB we were presented with plans for enhancing outpatient services with a free-standing campus. One option was to use existing facilities on an underused site, but this was ruled out because it would require hospital doctors to work at week-ends to make it cost-effective (in contrast to the alternative, a new build), something that was not allowed for in their employment agreement.

Can we continue to run expensive public hospital real estate and facilities on a predominant pattern of a five-day week service (aside from emergencies)? Under Covid we were able to cope with a 40% reduction in acute admissions for a time (although with unwanted consequences), and we learned to do with fewer outpatient visits, and more interaction virtually. There are opportunities for virtual wards too, and up to 40% of primary care enquiries can be conducted remotely.

Senior doctors strike in protest at their employment conditions

This brings into view media reports that a large number of IT jobs in the health system are likely to go. This is a misstep. IT and Artificial Intelligence (AI) are making a huge difference to interactivity and productivity in health internationally. Packages are emerging that can help predict and prevent avoidable hospital admissions among older people using their electronic medical records. Similarly, senior clinicians can use AI to provide advanced triage on referrals, and cut their workload by nearly 30%.

With the workforce plan, the infrastructure proposal, and IT advances, what step-change could we envisage? For example, the National Health Service (NHS) in the UK is speaking of a “three shifts” strategy: shifting care from hospitals to communities; moving from analogue to digital systems; and focusing on preventing illness rather than solely treating it.

With the outsize delivery and capital costs of the hospital sector and with an ageing society where the emphasis is more on managing long-term chronic conditions rather than dealing with acute episodes, there is a real opportunity for New Zealand to rethink the central role of the acute hospital, ensure greater flexibility in the healthcare workforce, and make the public comfortable with the essential virtual and digital elements of a modern health care system.

Peter Davis, Emeritus Professor of Population Health and Social Science at the University of Auckland, and former elected member of the Auckland District Health Board.

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