GPs disappointed with ‘insufficient’ increase in Government funding

Thursday, 18 July 2024

Despite warnings from the primary care sector that a double-digit increase in funding is needed to keep general practices sustainable, the Government has stuck to its guns by increasing capitation funding for general practices by just 4%.

Health NZ living well director Martin Hefford confirmed GPs will get 4% more funding and be allowed to increase their fees by 7.76%.

“[This] gives a combined 5.88% total revenue increase,” he said.

“This matches the independent estimate of general practice services cost growth over the past 12 months from Sapere Research group.”

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Hefford pointed out GPs were “automatically compensated for population growth through capitation payments”.

The uplift to Very Low Cost Access (VLCA) practices, community service card holder subsidies, under-14 rates, and immunisation rates is 5.88%.

The new rates will be in place from August 1, with backdated payments from July 1.

Health NZ released its funding proposal to PHO Services Agreement Amendment Protocol (PSAAP) members last month, before agreeing to a 20-day consultation period. It is understood Health NZ, primary health organisations and contracted providers met on Wednesday to discuss feedback.

General Practice New Zealand chairperson Dr Bryan Betty said a 4% increase in capitation funding was “absolutely inadequate”.

“Many practices are already marginal in terms of their sustainability. Regrettably there is little alternative left now other than increasing the co-payment fees paid by patients to avoid the collapse of some general practice services altogether.”

The Press previously reported GPs have already increased their fees, with some charging $70 per consultation. The average price across New Zealand to see a GP is $55.

GP and GenPro chairperson Dr Angus Chambers said GenPro believed a minimum of 14% more funding was necessary to keep vulnerable practices financially sustainable.

Requiring general practices to increase their fees did not equate to “maintaining the value” of Government funding and put the financial burden on patients, he said.

GenPro deputy chairperson Stephanie Taylor earlier said access to GPs would be lost if underfunding was not dealt with immediately.

“Multiple reports show that the current GP funding model is simply not fit for purpose. About one in three GP practices is losing money.

“Fixing the situation will require investment to retain the shrinking workforce, attract doctors to general practice, and recognise the quality and continuity of care they deliver.”

A 4% increase in capitation funding was “insufficient to retain services and meet needs of patients”, Taylor said.

Hefford said Health NZ acknowledged the cost pressures GPs were facing and the growing demand on their services, but the services it provided were facing “similar pressures”.

“Through our annual capitation uplift offer, we have worked hard to target available funding where it is most needed” he said.

One Christchurch GP said practices might be left with the difficult decision of whether to start refusing community service cards or charge for child appointments so they could stay in business.

The GP, who did not want to be named, said their costs had gone up by 10% and the capitation funding increase of 4% left them 6% short.

“We’re in the difficult situation that in order to stay open as a business we may have to start pulling back from subsidised funding streams that lead us to operate at a loss, such as the $19.50 community service card fee and the free under 14 scheme.

“Both of these will have significant impacts on vulnerable populations and I personally would rather not, but … I don’t see any other industry not increasing prices to match costs.”

General Practice Leaders’ Forum chairperson and Wellington GP Dr Sam Murton earlier said Health NZ’s funding increase was “unacceptable”.

“The Government needs to invest in primary care to ensure that we are preventing a further increase in hospitalisations for non-urgent cases. We know that for every $1 spent in primary care, $14 is saved further down the line in hospital care,” Murton said.

“It is disappointing to see that Health New Zealand do not recognise the urgency to prioritise investment in primary care.”