THE NEW ZEALAND PUBLIC HEALTH AND DISABILITY BILL

The New Zealand Public Health and Disability Bill (NZPHD Bill) makes changes to the health and disability sector in order to promote the Government's objectives of improving the health status and independence of New Zealanders.

The NZPHD Bill repeals and replaces the Health and Disability Services Act 1993. The Health Reforms (Transitional Provisions) Act 1993 is also amended and renamed. The Bill disestablishes the Health Funding Authority (HFA) and the Hospital and Health Services (HHSs). District Health Boards (DHBs) are created in place of HHSs and, in time, will carry out many of the functions previously performed by the HFA. The functions of the Ministry of Health will also be expanded.

GOVERNMENT'S OBJECTIVES

The Government is committed to achieving the best health and disability support outcomes for New Zealanders and reducing disparities between population groups. To achieve these goals it seeks to remove the competitive model and address the distancing of communities from decision-making. Accordingly, the NZPHD Bill will:

 replace the current commercial and competitive model with a co-operative and collaborative approach
 implement new arrangements that strengthen local community input and ensure a population health focus
 enable the development of comprehensive New Zealand Health and Disability Strategies to guide the sector.

STRUCTURE OF THE SECTOR

Through this Bill the Government will create a new structure for the health and disability sector based on 21 DHBs and the Ministry of Health. DHBs will fund or provide services for geographically defined populations and will be responsible for public hospitals and other related services which are currently owned by HHSs. Many of the HFA's current responsibilities for needs assessment and funding of services will transfer to DHBs. The Ministry of Health will continue with its current functions and, in addition, will be allocated some of the roles of the HFA and CCMAU (Health) (the latter transfer of functions is undertaken by mechanisms outside this Bill).

GOVERNANCE OF DHBS

DHBs will be established as Crown Entities (statutory corporations), they will not be companies. The boards of DHBs will be responsible to the Minister of Health for setting the strategic direction; appointing the Chief Executive; monitoring the performance of the DHB and the Chief Executive; ensuring compliance with the law, accountability requirements and relevant Crown expectations; and maintaining appropriate relationships with the Minister of Health, Parliament and the public

Board Composition

Each DHB board will have up to eleven members. Every three years, seven residents of each DHB district will be elected to each board by the community at the same time as local government elections. The Minister of Health will also appoint up to four members to each DHB board. In recognition of the Crown's partnership with Mäori, each board will be expected to have at least two Mäori members, or a greater number if Mäori make up a higher proportion of the DHB's population.

The Minister's appointment process will aim to ensure that each board has the best mix of skills and knowledge, and is representative of its population. For example, in those areas where Pacific people form a large part of the population, the DHB board will need the appropriate skills to consider the needs of Pacific people.

The proposed composition of DHB boards, therefore, balances the need for community participation, skill mix and the Crown's partnership with Mäori.

Transparency of DHB Board Decision Making

Part of each DHBs accountability will be to ensure that communities are involved in the deliberations of DHB boards wherever possible. DHB board meetings will, therefore, be open to the public and the community will be involved in the DHBs' planning processes. DHB performance information will also be publicly available.

THE ROLE OF DHBS

DHBs will have a population focus. They will be responsible for working within allocated resources to improve, promote, and protect the health of the population within their district and to promote the independence of people with disabilities. This will require DHBs to consider all needs and services including prevention, early intervention, treatment and support services, and how these services can be provided to best meet the needs of the population.

To manage any tension DHBs may experience in their dual roles as funders and providers of services, DHBs will have to establish three core advisory committees:

 A Health Improvement Advisory Committee which will provide advice on the mix and range of services that will best meet local health improvement and independence objectives recognising both resource constraints and the requirements of the New Zealand Health and Disability Strategies.
 A Hospital Governance Advisory Committee which will provide advice to the Board on the performance of its hospital(s) and related DHB-owned services, and strategic issues associated with the provision of hospital and related services.
 A Disability Support Advisory Committee which will advise the board on issues facing people with disabilities and how these can best be managed by the DHB.

While these committees are advisory, the board may specify and delegate authority to committees to act on specific matters as appropriate.

Service Delivery

In meeting the health and disability support needs of their populations DHBs may either deliver services themselves or arrange for other providers to do so. The Ministry of Health will also have a role in the planning and funding of some services where significant national co-ordination or management is required.

DHBs will also be expected to work together and enter into co-operative and collaborative arrangements where appropriate to ensure the best service delivery for their populations. This includes making arrangements for services to be delivered by other DHBs, particularly where it is not sensible for specialist services to be delivered in more than a few places. The Bill seeks to encourage co-operation and collaboration among DHBs to improve health outcomes. In order to minimise concern that this may be precluded by the Commerce Act, the Bill will apply the exemption in the Commerce Act that applies to commonly-owned organisations.

DHBs are new entities which will have significant responsibilities and the establishment of DHBs will need to be carefully managed. The NZPHD Bill therefore allows for the Ministry of Health to initially take responsibility for existing service contracts which will become the responsibility of DHBs as they become capable of assuming greater levels of responsibility.

PARTNERSHIP WITH MÄORI

The Crown's partnership with Mäori is an integral part of the health and disability sector and is therefore also an integral part of the NZPHD Bill. The Government proposes a partnership approach which will ensure the engagement of Mäori at all levels in the health sector. Provisions for this partnership will be set out in both the NZPHD Bill and DHB accountability documents. The provisions in the Bill are:

 reference to the Treaty of Waitangi which will ensure the Act is interpreted in a way that is consistent with the principles of the Treaty
 representation of Mäori on DHB boards and their committees the requirement for DHBs to establish and maintain relationships with mana whenua in their districts to enable them to participate in strategic planning for Mäori health improvement in their regions. DHBs will also be required to establish other arrangements to ensure Mäori generally have opportunities to participate in strategies to improve Mäori health
 the need for DHBs to improve Mäori health outcomes and thereby reduce disparities between Mäori and other New Zealanders
 the need for DHBs to assist with building Mäori capacity for participating in the health and disability sector and for providing for their own needs.

ACCOUNTABILITY

A range of accountability mechanisms is proposed for DHBs which are commensurate with their level of service and fiscal responsibilities. DHBs will be required to develop and make public the following accountability documents:

 a strategic plan which will have a 5-10 year focus and which will be developed in consultation with the community and endorsed by the Minister of Health
 an annual plan which will incorporate the annual funding agreement and the statement of intent, and which will be agreed with the Minister of Health
 regular monthly and quarterly reports against the annual plan.

Planning will be consistent with the resources available to DHBs and will be undertaken within the parameters of the New Zealand Health and Disability Strategies. Each DHB will need to consider the full range of services which its population needs. Plans will also need to reflect prudent management of Crown-owned assets, such as hospitals, and will need to include specific initiatives or priorities which are communicated by the Minister of Health.

The accountability framework will be particularly important to ensure that DHBs do not unduly favour the public hospital and other services which they deliver over those services which are typically delivered by non Crown-owned providers (such as general practitioner services, many disability support services and by Mäori-for-Mäori services).

The Bill also provides for other accountability checks on DHBs in certain circumstances. For example, DHBs will need to produce business cases for the approval of the Ministers of Health and Finance when they wish to undertake significant capital investments. DHBs will also be subject to the Public Finance Act, the Official Information Act, the Ombudsman Act and other similar legislation.

There may be times when sanctions need to be applied against either individual Board members or the whole Board. The most serious sanctions are included in the NZPHD Bill, with checks to mitigate against inappropriate use. The Bill includes the ability for the Minister of Health to direct DHBs; to appoint a Crown Monitor to report to the Minister on the performance of the Board; to replace the board with a Commissioner; to dismiss board members, and to replace the Chair or Deputy Chair of the Board. The Minister will also be able to withdraw functions from a DHB if its performance is inadequate.

OTHER AGENCIES

The NZPHD Bill includes appropriate non-commercial arrangements for the following agencies or committees, which currently operate in the sector:

 Pharmaceutical Management Agency (PHARMAC)
 New Zealand Blood Service
 Residual Health Management Unit
 National Advisory Committee on Kinds and Priorities of Services (National Health Committee)
 National Advisory Committee on Health and Disability Support Services Ethics.

The Bill also allows two new types of committee to be established:

 Health Workforce Advisory Committee - to advise the Government on how to ensure an adequate and responsive professional health workforce
 Mortality Review Committees - to review and report on specified classes of death. The initial priority areas for review will be child mortality, maternal mortality and perioperative death.

OTHER MECHANISMS

This Bill also provides for a number of other mechanisms to facilitate the smooth, safe, and effective functioning of the sector. For example, the Bill includes provision for the Minister of Health to establish advisory committees for specific purposes and to undertake inquiries into particular issues. The Bill also allows for the transfer of staff, assets and liabilities from the HFA and HHSs to DHBs or the Ministry of Health, and makes necessary consequential amendments to other Acts.

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