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Better to Be Sick in New Zealand?

What BC's Health Ministry learned from Kiwis about drugs, charging patients, and more.

By Andrew MacLeod, 29 Jan 2009, TheTyee.ca

Doctor with stethoscope

Breath deep. That'll be $60, please.

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A B.C. government task force sent to New Zealand in the fall has revealed the "learnings" this province could glean from Kiwis when it comes to delivering health care.

One is saving money on drug purchases by having B.C. partner with New Zealand.

Another idea would be far more controversial here: charging patients every time they visit a clinic or hospital.

New Zealand's geography, with mountain ranges and plenty of coast, is much like ours. The population of roughly four million is about the same as British Columbia's. And the New Zealanders have a significant Maori population with their own particular health risks, much as B.C. has a First Nations population that generally is sicker and dies younger than the rest of the people in the province.

B.C.'s assistant deputy health minister Craig Knight listed these similarities earlier this month during a presentation, "Learnings from the land of the Kiwi," to a hundred or so bureaucrats in the basement of the Health Ministry building in downtown Victoria where he and three other ministry staff reported on their November 2008 trip to New Zealand and on the ongoing relationship between the two jurisdictions.

There are, however, significant differences between B.C. and New Zealand, Knight and others on the panel pointed out. And while British Columbians should hope Health Minister George Abbott and his staff can learn from some of those differences, there are others they would likely fear.

New Zealand on drugs

There are some areas where innovations from New Zealand, or co-operating with the country, would likely be welcome to British Columbians.

Drug policy, for example, is one area where New Zealand and B.C. are working closely together, said Bob Nakagawa, the assistant deputy minister in charge of Pharmacare. There's a history of the two co-operating, he said (see sidebar).

The pharmaceutical industry is global, he said, and that gives them advantages when they negotiate prices with governments. "They do strategic planning across jurisdictions."

In some cases, the price of a drug in Canada will depend on the average price in seven other countries with similar economies. So the drug companies will strategize to find ways to bump that price higher, said Nakagawa.

By communicating with each other about what they're paying for drugs, countries like Canada and New Zealand can enter negotiations with drug companies armed with information. "We're trying to share information on the payer side," he said. "We can be more strategic, more like some of the businesses we're interacting with."

Pay as you go

Other ideas from New Zealand's health care system would be a very tough political sell. Surely the most controversial idea the B.C. team brought back is co-payment, where a patient pays a fee every time they see their doctor or have any contact with the health system.

It's not something the panellists were talking seriously about implementing here, but it is something they were talking about. Co-payments were at one time in the range of $50 New Zealand, Knight said, or about $35 Canadian.

"It's been brought down," he said. And some people are excused entirely from paying. Mainly the fees are targeted to people who are working, he said. "For people who're unemployed, the elderly, children, there is no co-payment."

During the question and answer period, two New Zealanders who had seen the co-payment system from the patient's side spoke. On a recent visit home, one woman said, she had been charged $60 for a Pap smear.

The Pap test is a reliable way to detect abnormal cells that may be a sign of cervical cancer. In Canada, women are generally advised to have a pap test at least every two to three years to catch problems early. A fee would likely discourage many women from getting regular checks.

"While they say co-payments have gone down, I think a lot of it is propaganda," she said. "There's quite a lot of propaganda in the system."

Fraser Institute connected NZ to BC

British Columbia has learned from New Zealand in the past, thanks to the Fraser Institute.

"Reference pricing was largely pioneered in New Zealand," pointed out Bob Nakagawa, the head of the provincial Pharmacare program.

At last week's information session at the Health Ministry, Nakagawa recalled that it was David Moore, a New Zealand health policy expert, who first explained the concept to B.C. policy makers during a visit in the early '90s. For certain classes of drugs, when there's more than one drug that's equally effective for treating a disease, the government will pay for the cheapest one.

The NDP government of the day introduced reference pricing, saving the public drug system bags of money and irking the big drug companies who saw it cutting into their profits.

As it happens, Moore was only in Canada because the Fraser Institute brought him to take part in a panel on the pros and cons of reference pricing. The right-wing Fraser Institute generally favours an unfettered market, taking exception when governments pick winners and losers. But in this case, said Nakagawa, they ended up helping the government: "That was courtesy of the Fraser Institute."

– A.M.

Similarly, she said, the New Zealand government will claim it has increased subsidies for doctors to treat people who are Maori or living in poverty. The idea is the money will reduce the fees people pay for health care. But many of the doctors don't pass the subsidy on by lowering their fees, she said. "I want to put a warning on the information."

A second New Zealander said there was a time when the country paid for health care as part of a broader welfare state, but that changed when there were national financial difficulties in the 1980s. "It moved the very social side of New Zealand to a pay-as-you-go system," he said.

The older generation who remember how things were especially dislike the new system, he said. "I know a lot of people and see a lot of people. There's a lot of disquiet around the copayments . . . This is a significant hardship for some people."

Primary care

Another area of interest for the panellists was how New Zealand puts more emphasis on primary care, with patients seeing a doctor, nurse or other professional depending on their needs. Staff from Fraser Health Authority, including president and CEO Nigel Murray, went on the trip to look at how primary care could be done differently.

In Canada, there have been experiments with different primary care models, but a family doctor, or increasingly a doctor in a walk-in clinic, generally still serves as the gatekeeper between patients and the health care system. A patient will see a family doctor, then be referred depending on what they need. As Knight put it, "We have more of a specialist emphasis in our system."

There are advantages to the patient-centred care offered in New Zealand, said Elisabeth Wagner, the ministry's executive director of corporate policy and research. "They feel they are able to avoid more costly services."

Related to that, she said, more of New Zealand's physicians are on salary. Where our fee-for-service system gives incentives for doctors to push patients through their offices as fast as possible, the New Zealand system allows doctors to spend more time with their patients.

There are things to learn, but as health authorities division executive director Rebecca Harvey observed, specifically looking at the primary care emphasis and the use of co-payments, "I couldn't quite link it to B.C."

Indeed, they may not be the sorts of thing a B.C. health minister would want voters to know he was considering in the months ahead of an election. Not even if the ideas do come from a country with nice mountains like ours.

Related Tyee stories:

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Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria. You can reach him here.

15 Comments:

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  • DJT

    3 years ago

    I have absolutely no problem

    I have absolutely no problem whatsoever with hospital user fees (for those whose income is over a certain amount), particularly for emergency room visits. I don't know how many times I've asked people in emerg why they would come because of a little sniffle or "boo boo" on their finger and heard "because it's free". No, it ain't.

  • Skywalker

    3 years ago

    The Fraser Institute?

    Where were these guys when Reference Based Pricing was introduced? New Zealand charges more fees and their system is not something BC would tolerate.

  • Vortigern1

    3 years ago

    Bureaucracy?

    It would have been nice to know how much the New Zealanders spend on the management side of things. Do they have an equivalent to our Health Authorities?

  • Frank

    3 years ago

    Oh please

    BCers already pay for their "free" health care. MSP premiums are a sizeable whack to a person's finances (especially when they have kids) when they aren't lucky enough to have it covered by their employer. Strangely, the people who can most afford to pay the premiums are the ones who are most likely not to have to directly pay them.

    Somehow most other provinces are able to get by without charging people monthly premiums.

    If BC were to now charge patients $50 each time they wanted to access a clinic or family practice the yearly health care bills for a young family could be higher than any other cost except rent.

    Of course with places like Saskatchewan not charging monthly premiums nor for accessing a doctor on a per-visit basis there would be another reason for a young family to move to Saskatchewan (others being more jobs, less fees and tolls and far cheaper housing).

    Perhaps the Campbell government should be asking itself why other provinces are simply far better managers when it comes to health care.

  • avaiki

    3 years ago

    from a kiwi - don't fall for it !

    Always interesting to see one's own country reported on from afar!

    New Zealand "enjoys" one of the most fundamentalist free market approaches to economic development.

    No doubt much of value has been learnt within the health sector but I'm not sure if good outweighs bad.

    Yes, New Zealand has health authorities, known as District Health Boards, corporate style entities infamous for sucking up huge amounts of cash but failing to deliver improved health services.

    Signs are starting to show that the fundamentalist approach has reached its high water mark.

    One example: after 14 years of private contracting, marked by strikes and complaints, one of the main health boards voted to bring cleaning and related services back inside the public service.

    New Zealand may be corporately correct, but fundamentalist free marketeering has left our country with high rates of ill health, suicide and depression, with a consistent gap between productivity and prosperity.

  • G West

    3 years ago

    avaiki

    Thanks so much for that - always nice to hear the story from someone who 'really' knows what's happening because they 'live' it every day.

    The tax system is the way to pay for public services - not through fees at the door.

    That way, the costs are allocated precisely according to ability to pay and no one does without.

    This is not rocket science - Tommy Douglas brought the system to North America in 1947 - made it province wide in the sixties...

    Those who suggest it needs to be turned into a market system are always selling something and seldom much concerned about your health.

  • bob the cat

    3 years ago

    Cleaning and related services

    I had the bad luck back in September to suffer a torn retina in my left eye. Laser surgery was recommended and as quickly as possible as the chances (partly due to my age)of complete detachment were pretty good.

    I was assessed at a private clinic and then sent to Lions Gate Hospital for the laser treatment.
    While signing in at Admitting and chatting a bit with the admitting clerk I told her how I`d worked at LGH many years ago as a night porter while going to school.
    She leaned forward and whispered " Have you noticed how dirty this place is"? I said I hadn`t really had time to look around much and wasn`t seeing too well anyway. As my wife and I proceeded to " The Laser Room" she said to me " Did you see that?" It was a used bandage..not a band aid..a bandage.. lying on the floor.
    It was still there over an hour later when we came out of the surgery.
    To make a long story short...after a subsequent post-op check (on equipment who know when the stuff was last sterilized) a few days later..I developed an eye infection which turned out to be keratoconjunctivitis a virus of a particularly nasty sort which attacks the blood vessels in the conjunctiva. It is highly contagious. Despite taking all the precautions we could..surgical gloves..separate bathrooms, etc. my wife contracted the virus. She was off work 5 weeks. Due to an error by an intern I was given the wrong substance for my eyes and developed Symblepharon which an opthamologist told me in her many years of practice had never seen. My eyes were in effect chemically burned and now I sit 4 months later with the lid of one eye "welded" to the eyeball and vision damaged at least 50%...the tear ducts top and bottom damaged and requiring manual application of "Natural Tears" ( Very small bottle..8 bucks a pop.." over the counter"
    Recently my wife had talked to a tearful hospital "cleaner" who said they were only allowed 2 clean mopheads a week. In a hospital..imagine that. When I worked as a porter in the 70`s we would be called for a dirty mop and told to fetch a clean one immediately. We had mounds of clean and sterile mops done in house by a fine laundry staff to change our mops whenever needed.
    What do the people in this Province value? What would it take to ever wake them up. (sigh)

  • Cookie60

    3 years ago

    The great NZ rip off....

    ...health care. As a NZer recently returned after attempting to survive the NZ system, one word of caution...DON'T ! I trained as a nurse in NZ in the 60's when it had a world class system but has since degenerated into 3rd world status. The care given in emergency situations is top notch but basic affordable care is unavailable unless you have a good income, ie, private insurance, or bags of money.
    I needed to have my BP done 3-4 times weekly & was asked to pay 5.00 each time. I was unable to afford this, so simply didn't go. This was to see practice nurse only. The Dr's vsits were 25.00.
    I was hospitilised while there & it was a chaotic, filthy mess with syringes laying under beds, blood & faeces on the drapes between beds...appalling, & this one of the biggest & most modern hospitals in the country. I had a consult with a German surgeon, who, after learning I'd come from Canada, greeted me with the words "Welcome to the third world' It was, &, is still. So, all the fancy rhetoric about NZ having any answers to our BC health issues...phooey. They can't handle their own in any fiscally responsible fashion with their DHB's groaning under the weight of over-paid management

  • PepperGirl

    3 years ago

    Different Systems

    I read an interesting idea recently in "The Undercover Economist" by Tim Harford about a health care system model currently in use in Singapore.

    The book was looking primarily at the US (where loads of people have no insurance and can't afford basic health care) and the UK (where everyone is covered, but health care services may be rationed based on price, so you may not get the care you want), and tried to find a solution to both issues.

    The Singapore system provides each person with a basic amount to spend on health care each year (roughly equal to per capita health care costs through taxes or insurance), and let people "pay" for their own choice of health care treatments. This resolves the US issues of both insurers who refuse coverage and people who can't afford it, and the UK issue of a health care plan that won't cover the desired treatment, improving choice and providing universal coverage. The basic care allowance would be supplemented with catastrophic health insurance to ensure that anyone who wound up with a serious illness and needed major surgery would have it covered.

    I'm not sure how well such a system would go over in Canada, but it is an interesting thought. By giving people a set budget, they may learn that there are limited health dollars, and so make smarter choices about how to spend the money (no emerg visits for minor issues). It would also ensure that everyone has good care.

    Let's see how long it takes for the Health ministry to book their tickets to Singapore...

  • Bobbi

    3 years ago

    Pay for Doctor's Visits

    I would be pleased to co-pay for Doctor's visits. Since BC Med insurance is already linked to income, I would be thrilled to swipe my Health Care Card and be billed quarterly for my usage. It could be adjusted against income level, and there could be an annual scale for chronic illnesses. I have a firm belief that everyone should make a contribution commesurate to their income and their health care consumption.
    Any fee schedule should recognize the different levels of care and should be capped at a maximum percentage of annual income along a sliding scale.
    If you have read this far without your head spinning off and hurling it through the monitor, I think even the homeless should be required to pay something, even if it is pennies.
    Health care has value, and while society should do everything it can to mitigate the impact of the cost of care it should not eliminate that cost. Health care is not free, and it should be treated like the valuable service it is.

  • avandoc

    3 years ago

    Not better

    Clearly it's not better to be sick in NZ. User fees have been shown to be a barrier to care for lower income people, who are already less able to access basic health care and family doctors in Canada. Think of user fees as a regressive tax on a vital public service.

    Despite all the whining by the likes of Brian Day, doctor-cum-entrepreneur, and the Fraser Institute, BC has a good health care system. Cancer survival rates are the best in the country and among the highest in the developed world. A little known fact: average longevity, especially for men, is near global tops. Men in BC live longer than men in Japan (some of which has to do with low smoking rates).

    Yes, we sometimes wait too long for some elective procedures and we don't have enough family doctors, but the two-tier systems of NZ and Australia have led to longer waits and shoddier care in the public system. It's inevitable--give the wealthy their own hospitals and they will not want to keep paying taxes for anyone else's medical bills.

  • G West

    3 years ago

    Bobbi

    That's what the tax system is for.

    WHY Duplicate it AND incur the extra bureaucratic expense.

  • JollyRoger

    3 years ago

    User fees

    I too get a bit miffed when I see people at Emergency for trivial things. On the other hand, better safe than sorry. With long line-ups and wait times, I don't think too many people go to doctors for trivial things.

    On the other hand, there are times I go to a doctor and I'm no better off than if I hadn't gone. If I was paying for a service, I'd want a money back guarantee.

    Also, just because New Zealand has done it doesn't mean it's good. Just look at GST and Fast Ferries!

  • JollyRoger

    3 years ago

    Car accident medical claims

    In New Zealand, if you get injured in a car accident, you get a claim number. Even if you settle with insurance, you can claim for medical injuries for the rest of your life if it's related to the car accident.

    I'm paying about $1000 each year for injuries related to a car accident in 1994 and settled in 1998. Since the de-listing of chiropractic, massage and physio by the Liberal govt, I have to pay for the full costs.... costs which could not have been foreseen at the ICBC settlement.

  • avi_rocks

    3 years ago

    No hospital fees

    I was visiting New Zealand in 2007, fell off a ladder and mashed up my hand. I received excellent and immediate emergency room care, even though I had forgotten my insurance papers in the rush to get to the hospital. I was x-rayed, cleaned up, bandaged and sent home within a couple of hours.

    The charge? Not a penny. Didn't even need those insurance papers. I was told that anyone in the country - resident or not, insured or not - is covered if an injury or accident occurs.

    The strangest part of my experience was walking into a near-empty emergency room and receiving immediate care. It sure made me think that BC does have some lessons to learn from New Zealand.

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