health & science

Rise of the health charity

In the ever-constrained health funding environment, DHBs have been setting up charities in order to fund the extras the taxpayer dollar won’t stretch for. Laura Walters takes a look at the rise of the health foundation

Theoretically, the public purse should cover all healthcare costs, but in a climate constantly starved of dollars, DHBs are looking to business and community to help out.

Charities, which subsidise projects and services for DHBs, are not new but there seems to be a rise in the number of so-called health foundations, as the funding environment remains constrained and patient expectations change.

Last December, Auckland DHB set up the Auckland Health Foundation, joining the likes of Canterbury DHBs Māia Foundation, the Wellington Hospitals Foundation, and the well-known Starship Foundation.

The Auckland Health Foundation was set up during the same year the DHB posted its first deficit in a long time.

In July, Auckland DHB chief executive Ailsa Claire released a blog post titled: Auckland DHB, we have a problem.

Historically, ADHB had done well at living within its means, but that was not the case in the 2019 financial year. “And if we don’t do anything different this year, we will be facing an even more significant deficit for 2019/20,” she said.

Auckland is not alone in its financial woes, thanks to a growing population, people living longer, and a greater need for complex care.

Last month, David Clark announced the sector-wide deficit for the 2019 financial year was $1.081 billion.

And this week, the NZ Herald reported the Government had poured a total of $368 million into bailing out struggling DHBs.

Those in the sector talk about New Zealand’s world-class healthcare system, but the knowledge there will never be enough money creates a constant tension.

In a recent interview with Newsroom, the director general of health Ashley Bloomfield said during his career in health, he couldn’t remember a year when anyone said, ‘it’s alright, we’ve got enough money, in fact we can give some back’.

Some of the challenges could not be addressed immediately, as they relied on building capacity, both in the infrastructure and the workforce.

While there was a general acceptance there would always be some shortfalls, and New Zealand wasn’t alone in looking to philanthropists and businesses for help, it raises the question of whether DHBs should be crowdfunding these projects and services.

“Broadly, we want to take the health system from good to great."

The need for these charities could be seen as a funding failure, however, the foundations see themselves as providing the “nice to haves” - the extra services and infrastructure that takes patient’s healthcare outcomes and experiences “from good to great”.

Auckland Health Foundation chief executive Gwen Green said the charity was established in 2018 to financially support projects, research and education for Auckland DHB’s adult health services. Since then, it’s raised $1.59m.

Those funds had come from successful trust and grant applications, and donations from past patients and their loved ones.

“We go beyond what is currently funded in the healthcare system to focus on promising ideas, innovations and technologies that have the potential to benefit our patients and community, but could otherwise not be developed without external investment.”

The plan was to emulate the positive impacts made by similar foundations overseas, she said.

So far, the charity’s projects have included research, a new simulation training technology, and upgrading more than 40 whānau rooms.

Auckland DHB chief medical officer Dr Margaret Wilsher said the foundation supported the DHB’s adult health services in a way that was above and beyond what is funded publicly.

It also provided an opportunity for past patients, whānau or community members to contribute to special projects as a way of saying thank you, she said.

Down in Canterbury, the Māia Health Foundation has been running since 2016.

Chief executive Michael Flatman said the charity was born out of the post-earthquake hospital redevelopment.

Director general of health Ashley Bloomfield (right) says in his whole career in health, there's never been a year when there's been enough (or too much money). Photo: Lynn Grieveson

The allocated funding fell short of the hospital’s vision in some areas, so the foundation was set up in order to cover the shortfall.

One example was the new helipad at the hospital, rather than having the helicopter land at Hagley Park, 13 minutes away. While the helipad was funded, the proposed clinical centre at the helipad was not.

The foundation got to fundraising, and has covered the $2m shortfall.

Flatman said there was also a $3.2m shortfall in the child health area, for things like parent beds. And now it was looking at a youth mental health facility as a new capital project.

“Broadly, we want to take the health system from good to great,” he said.

“The reality is, I don’t think there will ever be enough to do everything everybody wants.”

Māia’s money came from a mix of major business partners, other charitable funds, small businesses and individuals. In the past year, the charity raised $2.3m.

Flatman said while some foundations were well-established, such as Auckland’s Starship Foundation, there was growth in the area, and he saw that continuing.

Flatyman suggested Southland might look to set up a foundation as part of its Dunedin Hopsital rebuild.

The foundations were independent entities, but all worked closely with their DHBs to identify projects. They generally had some trustees who held roles in the DHBs.

“It demonstrates historically and currently, they’re very very stretched."

Health Minister David Clark said New Zealand had good, publicly funded, publicly delivered health services, and hospital foundations played a welcome role in providing additional support for them.

While these foundations, and others in Wellington, Waitemata, Taranaki and Manukau don’t cover operational costs, other charities like the Canterbury Charity Hospital Trust and the rescue helicopters are relied on for life-saving services.

General surgeon Phil Bagshaw set up the Canterbury Charity Hospital Trust in 2004 to provide free treatment for people who were not being seen in the public sector, but could not afford to go private.

University of Otago professor Robin Gauld said the need for these charities showed the failings of the country’s “two-tiered” health system.

New Zealand was not alone in turning to philanthropists, but it shouldn’t be required, Gauld said.

“It demonstrates historically and currently, they’re very very stretched.”

Gauld said the competitive and uncollaborative DHB system was not delivering for all Kiwis.

He proposed doing away with the DHB model, in favour of appointing a chief executive to each hospital, and having all hospital chief executives work together in an alliance in order to increase collaboration, and remove unnecessary competition and duplication.

The Government has received the initial report from the Health and Disability System Review, which takes stock of the system and points to the need for substantial structural change.

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