New Zealand’s GP funding model is broken. How do we redistribute funding and establish a new funding model?
The enhancement of population health and the promotion of equity in healthcare are fundamentally contingent upon the efficacy of primary healthcare. In New Zealand, primary care facilitates approximately 23 million patient interactions annually, while emergency departments account for around 1 million. A hypothetical 6% reduction in primary care capacity over a year would result in a doubling of the workload in EDs. It is not uncommon for practices to cease accepting new patients, colloquially termed as "closing the books." Addressing the challenge of closed books is therefore urgent, as they represent a significant barrier to enhancing access to care and mitigating health inequities, which are pivotal objectives of New Zealand’s Primary Health Care Strategy.
The inaccessibility of PHC also exerts additional pressure on hospital services, particularly emergency departments, as individuals resort to EDs when they cannot access primary care. Māori populations, in particular, experience inferior access to high-quality healthcare, which contravenes the equity commitments enshrined in Te Tiriti o Waitangi. A recent study by Victoria University researchers, titled “Closed books”: restrictions to primary healthcare access in NZ, highlights that approximately 79% of the 227 surveyed general practices reported closed or limited enrolments between 2019 and 2022. The situation deteriorated over time, with the proportion of practices with completely closed books in 2022 (27%) being nearly four times higher than in 2019 (7%), and the proportion of practices with fully open books in 2022 (28%) being roughly half of that in 2019 (57%). Limited enrolments increased from 36% in 2019 to 45% in 2022.
Capitation funding formulas, which consider population characteristics, serve as a method for estimating the necessary funding to meet varying levels of need. Since 2002, Aotearoa New Zealand has employed a capitation formula to fund all general practices, aiming to cater to the needs of their enrolled populations. However, practices serving a higher number of individuals with complex health needs may not receive accurate funding if the formula’s variables do not adequately represent these needs. For funding formulas to be equitable and ensure that those with higher needs receive the necessary services, they must appropriately account for differences in patient needs. This is crucial for the financial sustainability of practices serving high-needs populations.
What is the optimal path forward? Should we prioritise the training of more onshore GPs? Should we allocate resources to distribute the workload across a multidisciplinary team comprising nurse practitioners, physician associates, and prescribing pharmacists? Should we leverage technology to bridge the existing gaps? Or should we pursue a combination of all these strategies?
Regardless of the chosen approach: time is of the essence.