Table of Contents Abstract

Download 82.79 Kb.
Date conversion04.02.2017
Size82.79 Kb.

Table of Contents

  1. Abstract………………………………………………………….………………………1

  2. Overview of New Zealand’s Health Care System………………………………………2

    1. Country Profile

    2. Health Status indicators

    3. The Role of Government

    4. Public vs. Private provision of Health Care

    5. Funding

  3. Evolution of New Zealand Health Care System…………………………………………5

    1. 1870s

    2. 1900s and 1910s

    3. 1920s

    4. 1930s

    5. 1940s

    6. 1950s and 1960s

    7. 1980s

    8. 1990s

    9. 2000 to present

  4. Similarities and Differences of Health Care systems in New Zealand and Canada …….9

    1. Public vs. Private

    2. Role of Government

    3. Health Act

    4. Funding

    5. Life Expectancy

    6. Infant Mortality

    7. Health Expenditure

    8. Health Care Professionals

    9. The World Health Organization

  5. Advantages and Disadvantages of New Zealand Health Care System…………………..13

  6. Recommended Management Practice..…………………………………………………..14

  7. Reasons for the Recommendation.………………………………………………………15

  8. References………………………………………………………………………………..17

Table of Appendices

  1. Basic Health Indicators

  2. World Health Report Selected Indicators

    1. Key to the World Health Report Selected Indicators

  3. Infant Deaths: Number of Deaths and Death Rates, by Cause, Sex and Age

  4. Life Expectancy

  5. Age Standardized Death Rates

  6. Structure of the New Zealand Health Care System

  7. Key Figures in Health Care Expenditures

  8. Historical overview of Health Care in New Zealand


This paper provides a broad overview of New Zealand’s Health Care System. A background of the country is provided, followed by a description of health indicators illustrating the health status of the population of New Zealand. The role of the government in health care is outlined, with a focus on recent changes designed to improve the overall health of New Zealanders. Public versus private provision of health care, and their respective funding structures are discussed. An overview of the history of health care in New Zealand illustrates the constant changes experienced by this country. The similarities and differences between the Canadian and New Zealand health care systems are then analyzed. Advantages and disadvantages of the system are highlighted, and recommendations are made so that Canada may benefit from successful health management practices employed in New Zealand.

Country Profile

New Zealand is located in the South Pacific Ocean, approximately 2000 kilometers off the southeast coast of Australia. The country comprises two main islands plus a number of smaller islands with a combined land mass of 269 000 square kilometers. Of the 3.8 million inhabitants, 88 per cent of the population is of European descent and 12 per cent of the population is of Maori or Polynesian descent. The Maori people are indigenous to New Zealand and they represent special challenges to the country’s health care system.

Although New Zealand is often perceived to be a rural country, 80 per cent of the population lives in urban areas, with 50 per cent concentrated in the four main cities, particularly Auckland. The rural population is widely dispersed. While many farming areas are relatively affluent, other rural areas- particularly those with a high percentage of Maori- are characterized by unemployment, substandard housing and poverty.

European settlement from the late eighteenth century had a devastating effect on the health of the Maori population. Infectious diseases, including tuberculosis, typhoid, and venereal diseases, claimed the lives of many. Despite the recent narrowing in socioeconomic and health status differentials between Maori and non-Maori people, the Maori still have a lower life expectancy, lower average incomes, higher unemployment rates, and generally poorer health compared with the rest of the population. (Journal of Public Health Medicine, 1996)

Health Status Indicators

The health status of New Zealand has greatly improved over the last forty years. According to the World Health Organization (WHO), life expectancy at birth in 1997 was 73.7 years for males and 79.1 years for females, however this is low compared to other Organization for Economic Cooperation and Development (OECD) countries (See Appendix 1 for life expectancy and other Basic Health Indicators). In assessing overall level of health, the WHO also calculates a Disability Adjusted Life Expectancy index (DALE). The DALE is a measure of the expectation of life lived in equivalent full health, and this is 69.2 years for New Zealanders; thus New Zealand is ranked 31st in the world on overall level of health. With regards to overall health system performance, New Zealand is ranked 41st in the world, while Canada is ranked 30th (See Appendix 2 for these and other WHO rankings).

New Zealand’s infant mortality rate has decreased in the last forty years, but is relatively high compared to other OECD countries. In 1998, the rate was 5.7 deaths per 1000 live births (FAHADINZ, 1999). The major causes of death for infants include perinatal complications, congenital anomalies and Sudden Infant Death Syndrome (SIDS) (See Appendix 3). The New Zealand government reports that when young, unmarried mothers from lower socioeconomic groups with limited education bear children, SIDS is more common (FAHADINZ, 1999)

The major cause of death in the general population of New Zealand is disease of the circulatory system, followed by malignant neoplasms (cancer) (See Appendices 4 and 5). Of particular concern to the government is the loss of life in this country due to mostly preventable causes. Major problems contributing to low life expectancy, especially among the Maori population, include smoking, poor nutrition, drinking and suicide. The New Zealand government estimates that approximately 70 per cent of premature deaths in the 0 to 74 age group are avoidable (FAHADINZ, 1999).

The Role of Government in New Zealand’s Health Care System

The Minister of Health is the head of the New Zealand health care system. This person is a Cabinet Minister and is responsible to the Parliament for the activities of the Ministry of Health. The duties of the Minister of Health are defined in the Health and Disability Service Act of 1993. His or her primary responsibility is to ensure that the government’s health policy objectives for the country are achieved. (FAHADINZ, 1999)

Until recently, the health care system consisted of four regional health authorities (RHAs), which were set up to purchase all primary, secondary and tertiary health services, including disability support services in New Zealand. In effect, this meant that all government funding for personal health services was integrated into a single budget, and that budget was capped, including funding for fee-for-service primary care payments. There were also 23 crown health enterprises (CHEs) which entered into contracts with the RHAs to provide services alongside private hospitals or other private providers. CHEs were independent business entities, governed by a government appointed board of directors. Under the legislation, CHEs were required to act as successful and efficient businesses while exhibiting a sense of social responsibility. (Journal of Public Health Medicine, 1996 - See Appendix 6).

The New Zealand health care system is currently undergoing change designed to focus on improving the overall health of all New Zealanders. These changes are being guided by overarching strategy for the health and disability sector, specifically the New Zealand Health Strategy and the New Zealand Disability Strategy.

The changes are being implemented through the New Zealand Public Health and Disability Act 2000. This legislation allows for the creation of District Health Boards- a key step in moving to a population based health system. The 21 District Health Boards will have a mixture of locally elected members and members appointed by the government to compensate for skill shortfalls. The Boards will have overall responsibility for assessing the health and disability support needs of communities in their regions, and managing resources to best meet those needs. Services will either be provided from public facilities owned by the District Health Boards or purchased from private providers. (13th Commonwealth Health Ministers’ Meeting, 2000).

Public vs. Private Provision of Health Care

Overall, there are approximately 80 public hospital facilities in New Zealand including age related care and disability service facilities. The majority of beds in New Zealand (77 per cent) are in public hospitals (Shah, 1998). Patients with highest priority are treated first, while those patients presenting less urgent cases are placed on waiting lists. Priority setting for public health services is determined through clinical guidelines set forth by the Health and Disability Services Act of 1993. (MJA, 2000).

Public health services are often inter-sectoral activities. Current health initiatives in New Zealand include Child Health, Maori Health (which aims to increase the number of Maori health care workers in New Zealand), Youth Suicide Prevention, Strengthening Families, Immunization programs, the National Breast Cancer Screening Program and National Drug Policy (for reducing the use of tobacco, alcohol, and illicit drugs). (FAHADINZ, 1999).

Primary care from a general practitioner (GP) usually must be paid for privately by the patient on a fee-for-service basis, although the government subsidies most fees for children under the age of six. The government tries to ensure that access to GP services is not impeded for those with low incomes or those who have high health needs. It subsidizes about 70 per cent of the over 11 million visits to GPs each year.

Private hospital services must be paid for by patients. Private beds make up approximately 23 per cent of the total number of hospital beds in New Zealand. Private hospitals are usually smaller facilities with services limited to specialized procedures. Often, since waiting lists for surgery in public hospitals are so long, patients will opt to have their surgeries done in private facilities in order to have them done promptly. (FAHADINZ, 1999)


Approximately 77.5 per cent of health expenditure in New Zealand is publicly funded and each year nearly NZ $7 billion is allocated to health services in this country. New Zealand is unusual among developed countries, however, in only funding about 40 percent of first contact services through Vote Health in what is otherwise a predominantly publicly funded system. (See Appendix 7 for key figures in health care expenditures).

Private funding accounts for 22.5 per cent of total health expenditure in New Zealand and it comes from two main areas: individual out-of-pocket payments and private health insurance. Most private funding is out-of-pocket payments. Almost half the population have some private health insurance, but this accounts for only 6 percent of total health expenditure. Private health insurance does not provide comprehensive cover and is most commonly used to claim reimbursement for primary care user fees, elective surgery in private hospitals and specialist outpatient consultations. Total health expenditure has increased only marginally in the last twenty years, although the proportion funded by the state has been falling gradually. (Journal of Public Health Medicine, 1996).

Evolution of New Zealand Health Care


The first mention of an organized public health system in New Zealand occurred in 1872 when the Public Health Act was passed. The Act was responsible for setting up central and local boards of health and defined the power that these boards held. New Zealand was very concerned with quarantine and The Act gave detailed information about the rights of the local boards in regards to quarantining marine crafts. (MacLean, 1964)

A new Public Health Act was passed in 1876 to deal with issues regarding the boards of health. The Act replaced provincial central boards of health with a central board of health for the whole colony with the local authorities still maintaining their function as local boards of health. The new Public Health Act also had powers in regards to food handling, and sanitation. Both of these issues were important to ensure that spread of contamination and disease was prevented. (MacLean, 1964)

1900s and 1910s

In the year 1900 another Public Health Act was passed in response to the threats of the bubonic plague. The new Act reformed the health laws and in 1901 a Department of Public Health was set up ( This department came under the control of a Minister of the Crown. This Department of Public Health was given high powers, including the power to override local authorities. In 1908 The Act consolidated with amendments to become the Public Health Act 1908. A Chief Health Officer and district health officers staffed the Department of Public Health. These individuals were required to be medical practitioners who agreed to not practice medicine while in term and also to have extensive knowledge of sanitary and bacteriological science allowing them to deal with issues of sanitation to aid in preventing the spread of infectious disease, including leprosy, bubonic plague, and smallpox. (MacLean, 1964)


The next major act to be passed was the Health Act 1920. This act was passed as a result of the reorganization of the structure and functions of the Department of Public Health. At this time the powers of the district health officers was reduced and the local authorities were given an increase in autonomy. It is in this act that the Department of Public Health name was changed to The Department of Health. In the passing of this act a Board of Health was organized to assume many of the responsibilities of the district health officers and also to oversee the actions of the local authorities (MacLean, 1964).


The year of 1938 brought about the passing of the Social Security Act. This act aimed to help the people of New Zealand by providing medical treatment and benefits. This was provided to ‘maintain and promote the health and general welfare of the community’ (Koopman. et al., 1997). This act was introduced in response to the post-war welfare state and is credited with providing the representation of the main features of the state until 1991 (Koopman et al., 1997). Another important implication of this act the implication it had on the rest of the world. In passing the Social Security Act New Zealand became the first country in the world to develop a public hospital service allowing an open-ended policy that would ensure universal access to all citizens.


Major changes took place in the 1940s as implementation and amendments of the Social Security Act took effect and changed the way New Zealander’s obtained health care. The public system in place was primarily tax-funded and the government share of public health care funding jumped from less than 40% to almost 80% over the next twenty years (Blank, 1994). This increase was supported by the state as they believed that “access to health should be based on need, not on ability to pay” (Blank, 1994).

1950s and 1960s

In the 1950s and 1960s changes in the health care system began to take place as the system started to shift from primary and preventative care towards curative medicine with pressure from the public to increase their level of technological medicine availability. This resulted in an influx of professionals searching to cure diseases rather than trying to prevent disease from occurring. The shift away from preventative medicine resulted in a decrease in money from the government for primary care as the money was instead spent on curative medicine. (Blank, 1994)


The next major change to occur in the New Zealand Public Health System occurred in 1983 with the passing of the Area Health Boards (AHB) Act. The AHB became necessary due to the “fragmentation of the system, cumbersome hospital management systems, weak accountability mechanisms, increased hospital expenditures, and lengthened waiting lists” (Blank, 1994).

1983 also presented the introduction of the population-based funding formula used to determine allocation of resources to public hospitals, and was responsible for capping the major part of the health budget (Fougere, 1994). Capping of the health budget introduced a new set of problems when money was required for new health services. Rather than having the funds available on an as required basis these needs now had to be met through rationalization or cost shifting, increasing the potential of other areas of health care suffering (Fougere, 1994).

Although the rationalization strategy was not successful in the mid 1970s to the end of the 1980s it made a major impact in regards to changing the government and slowing down the process of health care reform (Fougere, 1994). The population-based funding formula also proved to be significant in the history of health policy in that it signaled the end of the open-ended policy that had been in effect since 1938 (Blank, 1994).

The years of 1983 to 1989 provided time for considerable change to take place in the New Zealand Health System. In 1983 decentralization of public health activities took place, removing them from the responsibility of the Department of Health and transferring the responsibility to regional agencies (Blank, 1994). This ongoing process resulted in the replacement of twenty-seven hospital boards with fourteen Area Health Boards (Ashton, 1995, Blank, 1994). These fourteen boards were responsible for providing “hospital services, public health services, and some community services for the people of their region from a population-based global budget” (Ashton, 1995). In 1989 the area health boards, who were held accountable to the Minister of Health, were presented with a set of “national health goals and targets to establish spending priorities” and required to draw up strategic and business plans for their services (Ashton, 1995). Due to these requirements the area health boards were forced to become more business-like in their operations, therefore appearing to improve somewhat in productivity areas, however budget difficulties started to become apparent in the form of aging equipment and long waiting lists and waiting times (Ashton, 1995).


In 1991 a major change took place as a result of a change in government. A task force was formed to review the entire public health system and related health services. Recommendations were published as a part of the government’s annual budget and became known as “The Green and White Paper” (Ashton, 1995, Blank, 1994, Fougere, 1994). The recommendations of the “Green and White Paper” included restructuring the entire system in regards to structure, delivery, and finance of health care (Blank, 1994). Restructure actions included splitting up the purchaser and provider roles that were previously assigned to area health boards, instead replacing them with four regional health authorities (RHAs) who were to be funded through the Ministry of Health according to the population-based formula. The regional health authorities were created to assess the health service requirements of their population and manage the purchasing of cost efficient services (Ashton, 1995, Blank, 1994). Another responsibility granted to the regional health authorities was that of purchasing primary health care, a responsibility that formerly belonged to the Department of Health, and also purchasing secondary, tertiary and community services (Ashton, 1995, Blank, 1994).

A second major recommendation in the reform plan was the reorganization of the public hospital and community services previously owned by the fourteen area health boards into twenty-three Crown Health Enterprises (CHEs) (Ashton, 1995, Blank, 1994). The crown health enterprises acted as businesses with appointed boards of directors and responsibility to pay taxes and dividends to the government (Ashton, 1995, Blank, 1994). The premise behind CHEs was to introduce features of a competitive market to encourage incentives for efficiency and increased productivity in both providers and purchasers (Ashton, 1995, Blank, 1994).

Regional health authorities took responsibility for the actions recommended in 1991 in the year 1993. By 1995 a regional health authorities review board was established to make initiatives to take into consideration the Health and Disability Service Act passed in 1993. The RHA review board suggested that initiatives focus on major results and major risks, and reinforcement of responsibilities of boards and management through role clarification (MOH, 1996).

In 1997 the Minister of Health advised and assisted in the replacement of the four regional health boards with one Transitional Health Authority. This was done as an initial step towards the goal of a single provider, as well as providing an opportunity to assess fiscal risk (MOH, 1997).

In 1998 the change over to a single funding authority was realized under the name Health Funding Authority (HFA). The health funding authority board was established and efforts were made to establish the roles of the HFA and Ministry to minimize duplication and create possibility for efficiency gains (MOH, 1998). Also occurring in 1998 was the successful launching of a website known as HealthNetNZ through the Ministry Of Health enabling Hospital and Health Services and other providers to “share information on best practice” (MOH, 1999).


The year 2001 brought with it the establishment of the 21 District Health Boards promised in the 2000 New Zealand Health Strategy and the transfer of the first installment of a portion of an agreed range of public health services from the Ministry of Health (MOH, 2001). The district health boards are responsible for funding and managing a large number of personal health, Maori health, and mental health service agreements, rather then the responsibility being with a central funding agency (MOH, 2001). This transfer occurred to encourage localization of services and provide delivery of better services, while also encouraging local collaboration between providers and as well as increased community leadership shown through healthy decision-making (MOH, 2001).

Similarities and differences between the New Zealand and Canadian Health Care Systems:

Public vs. Private:

New Zealand is a predominantly publicly funded health and disability system. The system is subsidized through the use of the Community Services Card, the High Use Health Card and the Pharmaceutical Subsidy Card. These cards are obtained when the government grants eligibility for use.

Canada has a mainly publicly funded health system as well. A network of ten provincial and two territorial health insurance plans privately delivers health care. “The system, commonly known as Medicare, provides access to universal and comprehensive coverage for necessary hospital, in-patient and out-patient physician services” (Health Canada). Canadians do not pay directly for insured hospital and physician services. There are no deductibles, co-payments, or dollar limits on coverage for insured services.

Role of the Government:

The government uses a population-based approach to funding New Zealand’s public health and disability system. District Health Boards are responsible for the health of their local populations and ensuring the needs of individuals and communities are represented at the local level. They both fund primary health care services and provide hospital services for their communities.

The Canadian Federal government is responsible for: “setting and administering national principles or standards for the health care system, assisting in the financing of provincial health care services through fiscal transfers, delivering direct health services to specific groups, and fulfilling other health related functions” (Health Canada). The Canadian provincial and territorial governments are responsible for: “managing and delivering health services, planning, financing, and evaluating the provision of hospital care, physician and allied health care services, and managing some aspects of prescription care and public health” (Health Canada).

Health act:

Changes to New Zealand’s health care system are currently being implemented through The New Zealand Health and Disability act of 2000. These changes are being guided through the New Zealand Health Strategy and the New Zealand Disability Strategy. The New Zealand Health Strategy is as follows: “a health system that all New Zealanders can trust, a health system that is there when people need it (regardless of ability to pay), a health system that makes a real contribution to reducing inequalities between the health status of Maori and Pacific peoples, and other New Zealanders.” (New Zealand’s Ministry of Health) The New Zealand’s Disability Strategy includes 15 objectives:

  1. Encourage and educate for a non-disabling society

  2. Ensure rights for disabled people

  3. Provide the best education for disabled people

  4. Provide opportunities in employment and economic development for disabled people

  5. Foster leadership for disabled people

  6. Foster an aware and responsive public service

  7. Create long-term support systems centered on the individual

  8. Support quality living in the community for disabled people and disability issues

  9. Support lifestyle choices, recreation and culture for disabled people

  10. Collect and use relevant information about disabled people and disability issues

  11. Promote participation of disabled Maori

  12. Promote participation of disabled Pacific peoples

  13. Enable disabled children and youth to lead full and active lives

  14. Promote participation of disabled women in order to improve their quality of life

  15. Value families, Whanau and people providing outgoing support

(New Zealand Ministry of Health)

The Canadian health care system follows the 5 principles that were created by the Canada Health Act of 1968. These 5 principles are:

  1. Public administration: the administration of the health care insurance plan of a province or territory must be carried out on a non-profit basis by a public authority.

  2. Comprehensiveness: all medically necessary services provided by hospitals and doctors must be insured.

  3. Universality: all insured persons in the province or territory must be entitled to public health insurance coverage on uniform terms and conditions.

  4. Portability: coverage for insured services must be maintained when an insured person moves or travels within Canada or travels outside the country.

  5. Accessibility: reasonable access by insured persons to medically necessary hospital and physician services must be unimpeded by financial or other barriers.

(Health Canada)


Both countries are mainly publicly funded. In New Zealand approximately 77% of health expenditure is publicly funded. New Zealand funds about 40% of first contact services through Vote Health. The rest is publicly funded through user charges (the portion of fees that the consumer pays) which are targeted according to age, income, and family size.

In Canada, the health care system is financed through a combination of government tax revenues, private insurance, private out-of-pocket payments and workers compensation. Government tax revenues includes income tax, sales tax, “sin” taxes, employer levies, health premiums, property taxes, etc. Private insurance is a prepaid coverage that is available for services not insured or paid for by government plans. Private out-of-pocket payments include co-payments and deductibles for various services partially insured by government or private plans. Finally, health care costs for employees that are injured at work are covered by provincial workers’ compensation boards, which are funded through employer contributions. (Health Canada)

Life Expectancy:

In 1997 the life expectancy at birth for people born in New Zealand was 73.7 for males and 79.1 for females. This is very similar to Canada who had a life expectancy at birth of 75 for males and 81 for females.

Infant Mortality:

In 1998 the infant mortality rate for babies born in New Zealand was 5.7 deaths per 1000 live births. This is close to Canada’s statistic, which was 6.1 deaths per 1000 live births.

Health Expenditure:

New Zealand’s health expenditure in 1998 was 8.4% of the Gross Domestic Product. Both out-of-pocket and health insurance real expenditure have increased steadily during the 1980’s and 1990’s. Out-of-pocket expenditure increased from $517,000 to $1,333,000, while health insurance expenditure increased from $57,000 to $520,000. (New Zealand Ministry of Health)

In Canada in 1996, the health expenditure was 9.5% of the year’s Gross Domestic Product. Public sector funding represents about 70% of total health expenditures. The remaining 30% is financed privately through supplementary insurance, employers sponsored benefits, or directly out-of-pocket. (Health Canada)

Health Care Professionals:

In New Zealand most primary services are delivered by general practitioners, which act as gatekeepers to the public health care system. Doctors and other health physicians working in public hospitals are salaried and those who work in the private sector are paid on a fee-for-service basis.

Canada also views their general practitioners as the gatekeepers to their public health care system. However, the government does not employ the majority of health care professionals in Canada. Most doctors are private practitioners who work in independent or group practices. Private practitioners are generally paid on a fee-for-service basis and submit their claims directly to the provincial health insurance plan for payment. Physicians in other settings may also be paid on a fee-for-service, but are more likely to be salaried or remunerated through an alternative payment scheme. (Health Canada)

The World Health Organization:

According to the World Health Organization (WHO), New Zealand ranks 20th and Canada ranks 10th in the number of dollars per capita spent on health care, $1,393 and $1,836 international dollars respectively. The WHO also ranks New Zealand’s health 31st and Canada 12th. Finally, the WHO ranks the overall health care system in New Zealand 41st and Canada 30th. In conclusion, according to the World Health Organization, Canada’s health system is functioning at a higher level with more positive outcomes than New Zealand’s. (World Health Organization)

Advantages and Disadvantages of the New Zealand Health Care System


One advantage of New Zealand’s Health Care system is that since the country has no smaller political divisions such as provinces or states, the system is universal and known to all citizens. Its cohesiveness allows for easier implementation of health policies that affect the entire nation.

A second advantage is that the government is currently moving to a population-based approach to funding New Zealand’s public health and disability system. Under this system primary care organizations, including doctors, nurses and other health professionals, would be funded directly to provide primary care services to enrolled populations instead of a pay per-visit basis. This would allow better teamwork between health professionals, more flexible use of funds, and more health promotion work to improve the health of communities.

The establishment of Quality Health New Zealand is another advantage of its health care system. QHNZ was developed to enhance performance in the health and disability support section. In order to achieve this goal QHNZ devised six principles regarding Community needs, which were: Client focus, leadership, teamwork, continuous quality improvement, best practice and process, and outcomes management. These principles aided in the coordination of services across the continuum which helps to cut costs, and they benefit the New Zealand public by providing timely, appropriate and quality care.


A disadvantage of New Zealand’s health care system can be found in its ranking on the performance on level of health by the World Health Organzation (see appendix 2). New Zealand ranks 80th in the world on this measure, which reports how efficiently the health system translates expenditure into health as measured by Disability Adjusted Life Expectancy (DALE). According to this measurement by WHO the New Zealand health care system is relatively inefficient with regards to health outcomes compared to health expenditure.

Another disadvantage of the New Zealand health care system is the constant changes that have taken place throughout its history. Frequent changes within the system have resulted in difficulties knowing and being informed of what services are available for use at any given time. These frequent changes may be contributing to a lack of knowledge and therefore a lack of utilization of the system thereby having a negative effect on health.

Recommended Management Practice

Quality Health New Zealand (QHNZ) in an independent non-profit organization established by the health sector in 1990 to enhance performance in the health and disability support section. It developed the Health Accreditation Programme New Zealand (HAPNZ), New Zealand’s national accreditation body for hospitals and other health and disability support services. QHNZ works with health providers and consumers to set quality standards, and measure and recognize achievement of those standards, with the goal of increasing the quality of service delivered to consumers (

QHNZ was first established as the New Zealand Council on Health Care Standards to provide voluntary accreditation for health facilities. In its first two years of existence it was funded by the New Zealand Government, area health boards, and the private Hospitals Association. This organization became independent in 1995. QHNZ is governed by a board of five independent directors. At first, the board consisted of representation from health providers, health consumers and the Ministry of Health, but it was later decided that a professional board would be best in order to compete in the very competitive health care industry. Members of QHNZ nominate board members, monitor board performance, and ensure that the organization continues to draw together professional, health provider and health consumer interests.

When HAPNZ was first developed, it was used to evaluate organizations’ structures, it focused on departments, functions, structures and standards of nursing, medical and other health professional services. Originally HAPNZ was delivery focused much like the current Canadian health care system. In 1994, there was a revision of HAPNZ standards that made the organization more client-focused. The 1994 revision incorporated community needs, client rights, and cultural appropriateness. Other aspects of this revision included coordination of services, the ability of family to participate in decision-making and service delivery, access to, and information about, services, and the opportunity for consumers to participate in problem solving.

QHNZ’s revised standards are based on the following six principles: client focus, leadership, teamwork, continuous quality improvement, best practice and process, and outcomes management. These principles also reflect the government’s priorities for health by including: a service continuum structure, a focus on the integration or coordination and linkages of services, and a population health and wellness approach. The new standards promote a population health and wellness approach to delivering services. Population health focuses on the needs of a given group of people, and the factors that determine health status. This approach aids in the coordination of services across the continuum. The New Zealand public stands to benefit from QHNZ’s client-based approach to managing health care. QHNZ standards help to ensure that New Zealand health consumers receive timely, appropriate and quality care.

Reasons For The Recommendation

The client-focused approach employed by QHNZ is what the Canadian health care system is in desperate need of. Over the last decade, the costs associated with providing health care in Canada has become a great concern due to increasing use of fee-for-service health care, breaks in communication between health care providers resulting in unnecessary duplication of services, and a host of other problems. And with an aging population, which tend to utilize health care facilities frequently, the financial future of the health care system will be in trouble if no changes are made to accommodate Canada’s changing demographics. Along with the development of these problems came the emergence of the belief that the Canadian health care system is failing. Instructor Murray J. Bryant of the Richard Ivey School of Business, discounts this claim. He believes that it is not the system that is failing, but rather the management of the system is failing. According to Bryant, presently Canada’s health care system is made up of a set of non-integrated silos with lots of data but no infrastructure designed to pass the information between health practitioners. This is one area where the Canadian health care system can benefit from adopting QHNZ’s client-focused approach. As previously mentioned, the coordination of health services by means of communication between health care providers is one of QHNZ’s guiding principles. This approach can help to reduce the unnecessary duplication of services performed on clients, thereby reducing costs.

Another reason why QHNZ’s health management style should be applied to the Canadian context is because they emphasize community-based care, and they provide opportunities for individuals to participate with service providers in making decisions on health choices. In the early part of the 1990s, Mharte and Deber (1992) reviewed reports from provincial and federal working groups established to examine the Canadian health care system. They used similarities found among the reports produced by these groups to develop the direction that health reform on Canada should take.

The objectives included:

  • Broadening the definition of health to include aspects in addition to the biomedical, such as the social and psychological aspects, with the collaboration of multiple sectors;

  • Shifting the emphasis from curing illness to promoting health and preventing disease;

  • Switching the focus to community-based care rather than institutional-based care;

  • Providing more opportunities for individuals to participate with service providers in making decisions on health choices and polices;

  • Decentralization of the provincial systems to some form of regional authorities;

  • Improved human resources planning, with particular emphasis on alternative methods for remuneration of physicians other than fee-for-service;

  • Enhanced efficiency in the management of services through the establishment of councils, coordinating bodies, and secretariats;

  • Increasing funds for health services research, especially in the areas of utilization, technology assessment, program or system evaluation, and information systems.

As stated earlier, the 1994 revision of QHNZ’s standards incorporated community needs. This revision included a community-based approach to managing health care, and the opportunity for consumers to participate in problem solving. Application of the QHNZ health care management style can greatly aid Canada in its efforts to reform health care.


Ashton T., From Evolution to Revolution: Restructuring the New Zealand Health System, Seedhouse D. Reforming Health Care: The Philosophy and Practice of International Health Reform, John Wiley & Sons Ltd, West Sussex England, 1995, (pg. 85-95).
Ashton T., Health Care Systems in transition: New Zealand. Journal of Public Health Medicine Vol. 18, (3), 1996, (pg. 269-273).
Blank R.H., New Zealand Health Policy: A comparative study, Oxford University Press, Oxford, 1994.
Bryant, M.J. “Class notes, Health Sciences 472: Health Management, November 26, 2001.”
Feek, C.M., Rationing healthcare in New Zealand: the use of clinical guidelines. Medical Journal of Australia Vol. 173, (8), Oct. 16, 2000, (pg. 423-426).
Fougere G, The State and Health Care Reform, Sharp A, Leap into the dark; The changing Role of the State in New Zealand since 1984, Auckland University Press, Auckland New Zealand, 1994 (pg. 107-124)
MacLean F.S., Challenge for Health: A History of Public Health in New Zealand, R.E. Owen, Wellington New Zealand, 1964.
Mhatre, S.L., Deber, R.B. (1992). From equal access to health care to equitable access to health: A review of Canadian provincial health commissions and reports. International Journal of Health Services Vol 22(4), (pg 645-668).
New Zealand Ministry of Health. (1999) Facts about Health and Disability in New Zealand (FAHADINZ). Government Document.
New Zealand Ministry of Health (2000). Health Expenditure Trends in New Zealand 1980-99.  Wellington, New Zealand. Government Document.
New Zealand Ministry of Health (1997). Annual Report for year ending June 1997. Wellington, New Zealand. Government Document.
New Zealand Ministry of Health (1996). Annual Report for year ending June 1996. Wellington, New Zealand. Government Document.
New Zealand Ministry of Health (1998). Annual Report for year ending June 1998. Wellington, New Zealand. Government Document.
New Zealand Ministry of Health (1999). Annual Report for year ending June 1999. Wellington, New Zealand. Government Document.
New Zealand Ministry of Health (2001). Annual Report for year ending June 2001. Wellington, New Zealand. Government Document.
Raffel, Marshall W. & Raffel, Norma K.(Ed). (1987).  Perspectives on the Health Policy: Australia, New Zealand, and United States. Chinchester, New York, Brisbane, Toronto, Singapore: John Wiley & Sons. (pg. 131-201).
Shah, C.P., Public Health and Preventative Medicine in Canada. (4th Ed), Univeristy of Toronto Press, Toronto, 1998, (pg. 308-311).
Shirley I, Koopman-Boyden P, Pool I, St. John S, New Zealand, Kamerman S and Kahn A, Ed. 1. Family Change and Family Policies in Great Britain, Canada, New Zealand, and the United States, Oxford University Press Inc, New York, 1997, (pg 207-304).

Historical Overview of Health Care Changes in New Zealand


First Public Health Act passed (MacLean F.S., 1964)


New Public Health Act passed (MacLean F.S., 1964)


Public Health Act passed (; MacLean F.S., 1964)


Department of Public Health set up and given effective powers (


Hospitals and Charitable Institutions Act passed (MacLean F.S., 1964)

  • Brought hospital boards duties previously discharged by charitable aid boards and separate semi-voluntary institutions (MacLean F.S., 1964)


Medical care for Maoris was transformed from Department of Native Affairs to Department of Public Health (MacLean F.S., 1964)


Public Health Amendment Act passed (MacLean F.S., 1964)

  • Board of Public Health established as advisors to Chief Health Officer (MacLean F.S., 1964)


Health Act established (MacLean F.S., 1964)

  • Split the department up into divisions (MacLean F.S., 1964)


Social Security Act passed (Koopman S.I., 1997; MacLean F.S., 1964)


Free hospital services and free medicines introduced (Koopman S.I. et al, 1997)


Health Amendment Act passed to include the quarantine of aircraft (MacLean F.S., 1964)


Completion of implementing universal and predominantly tax-funded public health service into place. (Blank R.H., 1994)


Mental Hospitals department amalgamated with Department of Health (MacLean F.S., 1964)

1950s, 1960s

Shift of emphasis in health care of New Zealand from primary and preventative care towards curative care (Blank R.H., 1994)


Access to primary care became restricted as result of General Medical Services benefit from 75% of total fee coverage to less than 20%.


Area Health Boards Act passed (Blank R.H., 1994, Fougere G., 1994)


Private hospitals play bigger role in health care system due to increased demands (Raffel M.W. & Raffel N.K, 1987).


Health Benefits Review presented with no action taken (Ashton T., 1995, Blank R.H., 1994)


Triumvirate system of hospital management by doctor, nurse and administrator replaced by general management (Ashton T., 1995).


National goals and targets developed, restructuring of 27 hospital boards to 14 area health boards (Blank R.H., 1994).


“The Green and White Paper” introduced to reform the New Zealand health care system (Ashton T., 1995, Blank R.H., 1994, Fougere G., 1994).

  • National interim system of part charges for hospital and outpatient care established, breaking the tradition of free hospital care (Blank R.H., 1994).


-Regional Health Authorities were put into place (Blank R.H., 1994).

-Public Health Commision (PHC) established to monitor and analyse state of public health, advise the Minister of Health, and purchase public health services on a bidded contract basis (Blank R.H., 1994).

-Health and Disability Services Act passed.

  • Provided access to acceptable range, level and quality of health and disability services (MOH, 1996)

  • Comprehensive and integrated care and support services provided (MOH, 1997).


Regional Health Authorities Review Board put into place (Ministry of Health, 1997)

  • Initiatives focused on major results and major risks, reinforced responsibilities of boards and management through role clarification (MOH, 1996).


Government’s Coalition Agreement on Health influences Ministry Work Programme resulting in replacement of the four regional health boards with a Transitional Health Authority.

  • THA is responsible for development and implementation of the new funding environment (MOH, 1998)


-Health Funding Authority successfully implemented

-Hospital and Health Services Knowledge Network launches a HealthnetNZ website (MOH, 1999)


New Zealand Health Strategy introduces plan for District Health Boards to reduce inequalities and improve public health (MOH, 2001).


-Functions and responsibilities of Health Funding Authority integrated with the Ministry of Health

-21 District Health Boards (DBHs) established and obtained health service delivery funding agreements from the Ministry of Health (MOH, 2001)

The database is protected by copyright © 2016
send message

    Main page