Budget 2024: NZ cuts more than $200 million from digital health
The New Zealand government has placed an emphasis on frontline services in its latest health budget.
The country has set aside NZ$16.7 billion ($10.3 billion) over three years to “address cost pressures” in delivering healthcare services. It will “provide certainty on the financing of the healthcare system so that work on improving our frontline services can continue.”
Meanwhile, more than NZ$330 million ($203 million) set aside for digital health initiatives over the past four years until 2027-2028 has been returned as savings to this year’s budget. This includes NZ$187 million ($115 million) for the Data and Digital Foundations and Innovation” initiative and NZ$144 million ($89 million) for the “Data and Digital Infrastructure and Capability – Enabling Health System Transformation” initiative. Both initiatives targeted on providing data and digital infrastructure and capacity needed to implement health care system reforms.
WHY IT MATTERS
The Digital Health Association, New Zealand’s peak body for digital health, has raised concerns about the apparent reduction in funding for data and digital healthcare initiatives.
‘The government has had to make some difficult choices. We all know the state of the economy and the government’s need to cut spending to invest in frontline workers, infrastructure and services. And in this case, it appears that some of the reprioritized funding may have come from existing programs that had underutilized contingencies from previous budget allocations,” Ryl Jensen, the group’s CEO, explained in a statement.
Based on the budget summary of initiatives, the funding will be repaid “pending work to prepare investment-ready business cases for future investments.”
Health Minister Shane Reti hinted at the publication of a 10-year plan that will guide New Zealand’s digital investments before the end of the year. news report noted.
THE GREATER CONTEXT
Over the past three years, the New Zealand government has invested up to NZ$1 billion ($616 million) in the healthcare system’s data and digital infrastructure and capabilities. Half of this went towards building Hira, the country’s new health information platform, the first phase of implementation of which will be completed this month, June.
In a briefing to Minister Reti late last year, Te Whatu Ora said this is the plan cutting back on building new ICT systems and switching to “fewer, more robust platforms”. The health care system, the report noted, has a “patchwork” of more than 4,000 clinical and business system applications, many of which have reached or are nearing end of life. These have also incurred technical debts.
The organization also plans to focus on migrating existing IT systems to the cloud, which it believes is a more cost-effective solution to increase service availability. In addition, there are plans to expand the ICT options for new care models and to invest in home care technologies.