Home healthcare funding unsustainable

29 April 2015

New Zealanders will lose access to good, safe home and community support unless there’s a change to the way services are planned and funded.

The Home and Community Health Association (HCHA) says its members are slowly going broke because home support is the only service not planned and funded on a national basis.

Chief Executive Julie Haggie says 25,000 workers provide home support for over 100,000 people living with chronic medical conditions and disabilities such as spinal or brain injury, moderate dementia and intellectual and physical disabilities, but that service is under threat.

“The lack of a consistent national approach is short-sighted,” says Ms Haggie. “Without proper support to help these people live in their own homes or communities, the only alternative for many would be full time residential care or hospitalisation.”

The HCHA commissioned business specialists Deloitte to review the sector which concluded the current funding model is unsustainable.  Ms Haggie says the issue has compounded over time with DHB contracts not keeping pace with the minimum wage increases and inflation.

“Home and community support providers are funded almost entirely by DHBs, the Ministry of Health and ACC. That funding just isn’t enough and with no other sources of funding, providers are being forced to cut costs year after year.

“Providers would like to pay more so they can attract and keep skilled people, but current contracts don’t generally allow for more than the minimum wage. The Deloitte report shows that all employers are struggling with some now operating in debt.”

Ms Haggie says funding tagged for home support is often used to support other services and the reality is providers can only absorb so much cost without compromising quality or safety – or even going broke.

“The Deloitte report shows that to meet increases in the minimum wage, organisations can’t pay staff more for additional qualifications, and the numbers of supervisors and coordinators have also been reduced to try and maintain frontline services.

“This is not a nice to have, it’s an integral part of modern care enabling people with high needs to stay in their homes as long as they can, reducing the burden on the hospital system.

“With demand expected to double in 20 years, home and community support will increasingly become an option only for those who can afford it.”

Ms Haggie says minimum wage rates lead to high staff turnover and shortages and legal challenges although the HCHA acknowledges the Government’s recent injection of money to pay for support worker travel between jobs.

“That has addressed one of the legal threats faced by employers. However, it does nothing to save the employers from going out of business.

“When we devalue these workers, we devalue the people they are caring for – the users of these services.

“Home and community care is the only service not funded on a national basis.  DHBs have agreed a national funding model based on client need and not just arbitrary rates, but until it’s implemented, the situation will only get worse.”