Performance Measures
There is a widespread perception that the requirement for SOEs to exhibit a sense of social responsibility interferes with their ability to operate as a successful and efficient business. Although the SOE Act requires explicit subsidy for services provided at a non-commercial rate, a number of people still consider some degree of tension to exist between the two objectives.
Nevertheless, whatever debate may take place over the division of the public health there can be little argument that a more efficient use of public health resources gives a "pie" to share around. As stated by Peter Troughton, original director of CHEMU:
The motivation of the Government is to improve the health status of New Zealanders through the creation of a more responsive, more efficient and better managed public health system focused on the delivery of quality health and disability services to all New Zealanders. That is the bottom line. (Troughton and Inglis, 1994:9)
In Troughton's view, the key to that efficiency, responsiveness and good management is a rigorous performance monitoring procedure. An international consulting firm estimated that a medium-sized CHE could save up to $15 million through improved management (Troughton and Inglis, 1994:12).
CHEs are required to report monthly against 23 performance measures. These measures are listed in Table 2. They cover the areas of customer satisfaction, operational performance, labour relations and financial performance.
The measures were based on similar ones implemented by management at Tauranga hospital to improve performance, and further refined following extensive consultation with AHBs, RHAs, Ministry of Health, professional organisations, and overseas consultants.
The information provided by CHEs has in the main not been published. Ombudsman Brian Elworthy has ruled that CHEs are not required to release this information under the Official Information Act, due to commercial sensitivity. CHEs do see their own results in comparison with others, without being able to identify the others.
Strengths and Weaknesses
The Post Election Briefing prepared by the Ministry of Health describes New Zealand's monitoring regime, in relation to both purchasers and providers, as well advanced in international terms (1993:32). Generally, indicators used in New Zealand are similar to those used in countries such as the UK, Sweden and Australia. They have been developed using fairly wide consultation, and are reasonably straightforward. However, the Post Election Briefing states that there is a need for further development of the performance measures, with a clarification of the objectives of monitoring and examination of the validity of certain indicators (1993:32).
| Table 2 CHE Performance Measures
1 A composite of at least 5 statistics, some of which may be determined by the CHE. 2 Secondary care including/excluding mental health, assessment and rehabilitation services and continuing care. 3 Sum of cash and temporary investments divided by current liabilities. |
Reporting against the CHE performance measures in Table 2 began on 1 July 1993. Since then some amendments and clarifications have been made, with a review recently having been undertaken by CCMAU based on the first six months of use. There are concerns with the suitability of the measures for aggregation and comparison between CHEs, and there are ongoing questions about the definitions for key variables.
Aggregation and comparison between CHE performance measures is not strictly valid partly because there is no scaling factor to take into account the complexity of the operations being performed. Work is proceeding on weighting the results by case mix using diagnosis-related groups (DRGs), which group procedures of similar cost and complexity.
Contact for Enquiries
Rural Affairs Coordinator
Sector Performance Policy
MAF Policy
Ministry of Agriculture and Forestry
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0675
Fax: +64 4 4 894 0745
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