Monday May 17
“Funding Investigation Highlights Risks Of Contracting Out Health Services”
“The investigation into alleged vanishing health funds held by a private mental health organisation highlights the risks
associated with contracting out health services,” said Mr Ian Powell, Executive Director of the Association of Salaried
Medical Specialists, today. Mr Powell was commenting on the Capital & Coast DHB’s investigation into the alleged disappearance of funds on overseas trips that it gave to the Porirua-based
Fagai Care Services to provide 24-hour care and housing to former psychiatric patients. The investigation will also
consider whether a convicted child sex offender was also placed with these former patients.
“These extremely serious allegations, whether true or not, confirm how risky contracting out health services can be.
Contracted out health services, regardless of whom the private provider is and the type of service, are much more
difficult to regularly and thoroughly monitor whether the right standard of quality of care is being provided to
patients and whether the funding is used in the way it was intended.”
“It is clear that the Capital & Coast DHB found it difficult to undertake the required level of monitoring and scrutiny. This is not surprising because
all district health boards are so busy and lack the resources to achieve this level of monitoring. But the potential
risk to patients and the risk of wasting taxpayers’ money are often increased.”
“While it is better, more effective and less risky for district health boards to provide health services directly
themselves, sometimes this is not always possible.” ”The costs of and resources for compliance and monitoring must
always be considered when considering whether to contract out services that they can’t provide themselves,” concluded Mr
Powell.
ENDS