NZ Healthcare

December 1, 2008 – 6:08 pm

At the New Zealand Open Source Awards, David Cunliffe (the then Minister of Health as well as of IT) literally tapped me on the shoulder and asked whether I’d be interested in serving on HISAC, the Health Information Strategy Advisory Committee. The health system in NZ, he said, might benefit from some of the open source and collaboration work that I do (he had been to Foo Camp the previous year and I think he pictures me as surrounded by a cadre of buzzing connected technophiles who do amazing things). “Sure,” I said, and that’s how I found myself in Wellington last week, attending the inaugural HISAC meeting.

What followed was a day and a half of intensive high-speed learning. I’ve never worked in the healthcare industry, so I was scrambling to learn the acronyms and history. My fellow committee members are all experts in their field (we have the top GP, the top hospital medical officer, the chief pharmacist, a CEO of a good DHB, etc.) so I had good tutelage! Of course, any inaccuracies in what follows is not their fault and I’m quite aware that I am not an expert. All I’ve heard are anecdotes and impressions, I’ve probably misunderstood some of them, so take what you read here as “this is how Nat currently understands it, but all assumptions must be validated by numbers and facts before acted upon”. And, of course, let me reiterate that our health care system does largely work. There are many national health systems around the world that do not. We have it good. Now, that said …

The state of NZ’s healthcare system is chaos. Government policy has been to devolve authority to the regions, hence the 21 District Health Boards (DHBs). DHBs get $ from the government, which they use to run hospitals and fund various community NGO activities. Alongside DHBs in the community are General Practitioners (GPs), delivering what’s referred to as Primary Care. GPs are not funded by DHBs, they are businesses. GPs used to band together in coop-like arrangements called Independent Practitioners Associations (IPAs, not to be confused with the beer), which provided services to their members. The IPA model was so successful that govt recently set up PHO (Primary Health Organisations) to mimic what they were doing but include the various non-GP deliverers of care (e.g., mental health groups, some NGOs, etc.) who are also on the front lines. Not all areas were happy to fold IPA activity into PHOs, and some areas kept their IPAs. Supporting GPs are med labs and pharmacies. On top of all this sits the Ministry of Health, apportioning the 9%+ of GDP that goes to public health. The MoH is huge, I think I heard >800 people mentioned as the number. (can’t find citation for this, so take with even larger grain of salt than the rest of this)

Whew. As you can tell, a lot of acronyms! Also a lot of organisations, each with their own governance and overhead. In theory it’s meant to devolve control of healthcare organisations back to the communities they serve, much like Tomorrow’s Schools devolved control of schools back to the communities. In practice the results vary. Some DHBs have their board, their CEO, and their staff all working together well. Others not so well, with the consequent lack of productivity and institutional inability to change.

GPs have traditionally been very hip with IT, though. Until 3 years ago, NZ GPs lead the world in adoption of it. What happened three years ago? Sure, the rest of the world caught up, but there was also a change in NZ. One vendor bought up another, there was an acquisition by a Singaporean VC, and suddenly development stalled. The GPs are still hungry for new features and want to be doing new things, but the software hasn’t been providing that. One product, MedTech32, has >80% market share. The main reasons why GPs would find it hard to change vendor is that they’ve customised the software, added their own fields, etc., and they’re terrified of losing decades of data. “The burden of prior innovation”, this was called. They lead the way before there was a standard way of doing things, now adopting the standards are as much of a pain to them as a benefit to others.

I look forward to learning more about DHBs: they consume a lot of money, and currently most everyone has analog processes when data moves between entities (GP, DHB, pharmacy). Each DHB has a CIO, and they all network. I heard several times that, like most technology people, the CIOs have trouble communicating the business value of the technology they’re implementing. Many CIOs are apparently sitting on 150+ different pieces of software, accrued over the years, and it can take all their time to simply manage what they’ve got. On top of that sits several high-profile and painful failures of software development (“we’ll solve this problem, we’ve spend a hundred million dollars, oh shit it is just a miserable disaster!”), making everyone from DHB Chairs to the CIOs themselves nervous about embarking on new projects. It seems safe to say, based on the stories I’ve heard, that no part of the healthcare system has a firm grasp of change management and project rollout.

Furthermore, each DHB does things their own way. This independence extends to the procedures around surgery, admission, etc., as well as to the IT systems in the back end. Only recently have they begun buying insurance together. The CIOs have agreed to a form of collective purchase: when they negotiate a contract, they share the price they got and vendors are required to offer the same price to other DHBs. CEOs have also signed on to adopting whatever initiatives have been most fruitful elsewhere, not duplicating projects. The board chiefs, CEOs, CIOs, chief medical officers, and other levels in DHBs all meet their compatriots regularly and share information on mailing lists. Yet there’s still an astonishing lack of overlap in adopted processes and tools. One person suggested that NZ’s spending on healthcare wasn’t small, it was just that it’s being spent on 21 different healthcare systems.

So let’s describe the paralysis: adding new software to a DHB is difficult because of tight money and the lack of consistency in ability to roll out new systems. Rolling out one DHB’s solution in another is difficult because of the varying processes across DHBs and some CIOs’ inability to be strategic because of the burdens caused by their mishmash of legacy systems. The Ministry of Health can’t force top-down solutions into DHBs because of devolution, the most they can do is dangle financial incentives. GPs don’t get new software because the vendor hasn’t provided it and switching costs are high. NGOs don’t get new software because they don’t have any money (many don’t have broadband or modern PCs).

Why do we want better software? Not just for software’s sake, but because: (a) interoperable software would cut down on patients who fall between cracks, (b) there are features like decision support that would improve patient care, (c) simplifying the things that are currently done by hand frees up staff to care for patients, (d) we need visibility into how our healthcare providers are doing but at the moment there’s no single consistent view of stats like “how many people died in surgery or within 60 days of surgery” across the NZ healthcare system, (e) we can’t begin to offer patients their healthcare information if its trapped within the organisations. We want to see safer organisations, better outcomes, fewer errors, more staff time spent delivering care, and visibility into the system.

Where did we end? This first meeting was to figure out what we wanted to do. We’re writing that up now, and will report it to the new Minister. (Poor bugger, I imagine he’s going through a similar learning curve to me, only several orders of magnitude worse!) Then we’ll gather research to show the current state, what’s lead to successes before and elsewhere, and advise the Minister so he can, hopefully, untangle this ghastly mess.

I talked about the technology trends that any strategy will need to deal with (analog to digital, tethered to mobile, generic to personal, etc.), looked at the system rather than any one facet, and tried to be my usual hardheaded self and keep the focus on what we could realistically achieve. I talked a little about open source, but I want to make sure I understand how software gets adopted and why it doesn’t before I rush in with my pet solutions. The problem here might not be software, it might be the systems and people around it–I just don’t know at this stage.

Thoughts? My apologies if I’ve mischaracterised something. As I said, this all came at a rush and I’m looking forward to learning the whole time I’m there. Corrections in comments welcome!

  1. One Response to “NZ Healthcare”

  2. Hi Nat
    Very interesting read.
    In this scenario, albeit your brief introduction to it, what importance was given to the patient and/or consumer-driven angles? I would love to know if both sides – patient and provider – are considered when implementing new software. Sounds like the lure of a sale pushed some interoperability concerns aside.
    Cheerio – Nathan

    By Magnatefoote on Dec 29, 2008

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