More on Medicine in New Zealand

The Government funds health care for everyone in New Zealand. The country is broken down into District Health Boards which fund the local hospitals, GP's and specialists. They spend somewhere between $2000 and $3000 per person per year depending on which District Health Board the person resides in. The difference presumably is due to differences in disease burden and how rural the location is--the more rural the location the more they have to pay physicians and locums to get them to practice there. Overall despite universal coverage, New Zealand spends only 8.9% of its GDP on health care compared to 15.2% for the US (and despite the US spending the highest percentage of GDP on health care of any country in the world, there are still 40-50 million Americans without any coverage, we're ranked 37th out of all developed nations as far as health care outcomes, and over 60% of current bankruptcies in the US are caused by health care costs). If you are interested in reading more about how different countries have decided to set up their health care system (all Western Countries in the world provide some form of universal coverage except the US) I strongly recommend the book by T. R. Reid "The Healing of America: A Global Quest for Better, Cheaper and Fairer Health Care."

So how is it possible to offer universal coverage at a lower cost as a percentage of GDP in New Zealand? It starts with a strong primary care base. Everyone in New Zealand is enrolled with a GP, and there are 4,000 GP's across the country. Each GP gets a certain amount of money per patient enrolled in their practice per month. In addition they collect copays from patients when they come in for office visits. These range from 0-$15 in a high needs clinic like the one I'm working in to $40-50 in a higher income area. (The high needs clinics get a higher amount per patient per month to make up the difference.) Patients can freely choose their GP's. Most GP offices seem to be in small groups of 3-6 GP's with the solo doc offices becoming less common. GP's can own their own practice or work as an employee for a clinic. A very high percentage of GP practices use an electronic medical record, and they are often tied into their local hospital so they can look up details of their patients hospitalizations and ED visits. Pediatricians and Internists are used more as consultants here and not as Primary Care Providers. They are typically hospital based and also have an outpatient consultative practice. A high percentage of deliveries are done by midwives. Patients aren't able to self refer to specialists; they must be referred by their GP.

The government aggressively controls pharmacy costs by "fully funding" certain medications so that the patient only pays $3 per prescription for a 3 month supply. The formulary tends to have 1-2 generic medications in each class of medication--I haven't found it to be too restrictive. They also fully fund some brand name medications if they feel it will lower the overall health care cost for the country, an example would be Chantix to help someone quit smoking. They also further control their costs by only letting certain specialists prescribe high cost medications that are used for limited uses, for example MS drugs have to be prescribed by a Neurologist, etc. Also, they have a "Special Authority" system so that I can prescribe Fosamax for a patient, but only if the patients T score is below a certain number and their fracture risk is above a certain number. They also limit ordering of certain imaging tests. MRI's can only be ordered by specialists, though they use ultrasound as a cheaper imaging modality much more often here. As a GP I am able to order an ultrasound to rule out a rotator cuff tear for example. They also provide regular feedback on how your prescribing and lab ordering practices compare to the other 4000 GP's around the country.

Seeing a specialist is covered as well if you are referred by your GP, though the drawback is the wait. When I do an electronic referral to get a patient in to see a specialist in the public hospital, I put whether the problem is urgent, semi-urgent or routine. The waits for these categories are 1 month, 1-3 months, and 3-6 months respectively. However, if something is truly urgent there's always the option to call the specialist and they can either see the patient in the Emergency Department or fit them in in the next day or two. The patient can also choose to pay out of pocket to see the specialist, and the fee is generally $100-150 for an outpatient consultation. Some patients have private health insurance that covers seeing private specialists--the main advantage being that they can get in to see a specialist in a week or two no matter how urgent their problem. This way they can bypass the wait to see the public specialist.

There is no charge for hospitalizations and ED visits are covered though there is a copay.

Patients here freely choose their GP and their only out of pocket expenses would be for $3 copays for medications, GP office copays, ED copays and in some cases charges for imaging procedures. Hospitalizations are free.

There is another parallel system that covers all the costs for any accident or injury that occurs on New Zealand soil no matter if the patient is a New Zealand citizen or resident; it's available to anybody who gets injured in New Zealand. More on this in a later post.