Like many governments, the health portfolio is one of the significant challenges for the New Zealand government. While in opposition, it promised to close the health services gap, eliminate fiscal deficits, and reduce inequities. In its first term of office, these gaps, deficits, and inequalities show no sign of slowing down even before the advent of the COVID 19 pandemic. The usual practice of blaming the previous government to some extent has bought this government some time.
In the late 2020 election, the government, seeking a second term, signaled a major shakeup of the health system. With the mandate of a landslide election result, the government, on 23 rd April 2021, announced a major shakeup of the health system with the following key features:
Shifting from a decentralized to a centralized system,
Redefining the Ministry of Health role as strategy, policy, and regulations
Big focus on structures: a. Health New Zealand b. Maori Health Authority c. Public Health Agency (within the Ministry of Health) d. Locality networks
Health New Zealand (HNZ). This new entity replacing the 20 DHBs will be a mammoth organization with dual operational and funding/commissioning roles. Its annual operating budget will be most of the current NZD20 billion health sector public funding. It will have operational responsibilities for all public hospitals and 12 public health units. Its funding/commissioning responsibilities will cover primary, community, disabilities, and aged care services. HNZ will operate through four regional offices and an unspecified number of district offices and governed by a board appointed by the Minister of Health.
Maori Health Authority (MHA). The MHA proposal has received a mixed reaction of praise, caution, and skepticism. Given that the current approach has produced an inequitable poorer outcome for Maori, doing more of the same is not an option. The proposed MHA is an opportunity to do something different. While there are few details, the MHA is expected to have a strong say in strategies, policies, and commissioning of services affecting Maori health outcomes. It will also independently monitor the progress of health outcomes for Maori and is likely to have some funding to support innovative services. The MHA board members will be appointed by and reporting to the Minister of Health.
Public health agency (PHA). With the high public health profile during the current COVID 19 pandemic, the public health portfolio is a major focus of this reform. The new public health portfolio will be split into two distinct parts. The PHA, operating as a separate unit within the Ministry of Health, will have responsibility for strategy, policy, and regulations, and (2) the twelve disparate public health units (currently managed by DHBs) responsible for delivery being consolidate under the new HNZ. Some would have like to see the reform go further by creating a single and independent public health entity responsible for strategy, policy, regulation, and delivery.
Locality networks of healthcare providers in the community. The intent is for these networks to be more accessible, more affordable, and better integrated to provide a seamless continuum of care in the community. Services provided by locality networks will include GP, maternity carers, district nurses, community pharmacy and optometrists, and kaupapa Maori services. At this stage, it remains unclear whether other community services such as dental services and home care for the elderly can be part of such locality networks. A significant structural change is dispensing the need for funding of GP services through a Primary Health Organisation. Details on exactly how locality networks will be structured, funded, govern, managed, and their performance measured are very much work in progress at this stage of the reform.
FOCUS OF THIS PAPER
This proposed reform agenda has attracted mixed responses from the enthusiastic, the skeptics, and naysayers. Some argue the reform does not go far enough (for example, with the public health agenda), while others point out that some parts of the system seem to be ignored (for example, the elderly). What most agree on is the proof of the pudding is in the eating – successful implementation.
This paper deliberately does not discuss the merit or otherwise of the proposed reform agenda. Rather, this paper focuses on "what will it take to implement the reform agenda as it stands successfully."
Vision and passion, while necessary, are insufficient to translate aspirations into reality. Implementation is where most reforms get into trouble, resulting in a compromise that no one wants. This article sets out three fundamentals needed to implement any health system reform successfully.
THREE FUNDAMENTALS TO PAY ATTENTION FOR SUCCESS
In any reform, there are three fundamentals for successful implementation: 1. The starting point, 2. An integrated whole of system approach, and 3. Complex, complicated, and simple approach.
Starting point – A or B?
In any reform, it is imperative to establish where the starting point is on the performance curve. Ideally, a high-functioning system will initiate reforms when its performance is on the way up, at point A. The reality is most health reforms are launched at point B, when the system performance is deteriorating, under considerable stress and pressures. The current New Zealand health reform starting position is point B.
When a system position on the performance curve is on the way up, mindsets are open, and the ability to try and accept new ideas is strong. There is a push factor driving change, especially when stakeholders can see the progress and gains being made.
However, when system performance is on the way down, negative stories dominate media headlines, exhaustion has set in, mindsets are closed, recognizing and accepting good ideas gets harder. There is a strong gravitational pull factor acting as a hand brake to do anything different. Great care and attention are needed during implementation to avoid an even greater deterioration in health services, fiscal gaps, and inequalities.
The integrated whole of system approach
In any reform, different stakeholders will have a different perspective on reforming the system. Common themes include:
- more resources (funding, workforce, facilities, technology, data),
- more investments in technology 4.0, better training, more research, and greater innovations,
- greater focus on quality, effectiveness, productivity, and efficiency,
- better performance measures (more outcomes rather than outputs),
- stronger levers for control, accountability, and performance,
- creation of networks and platforms for integration
- better funding models, including funder/provider split
- the centralized or decentralized organization, governance, and management structures
- greater focus on early prevention and broader determinants of well-being
All of the above should be part of any implementation work program. However, without a "target operating model," most implementation plans quickly become a collection of confused, disjointed, incoherent, siloed, and ad hoc work programs.
A generic operating model has twelve essential elements and is organized into three clusters. The first set of four are outward- facing, the second set of four are inward- facing, and the final set of four are resources needed.
Customizing a generic model into a target operating model for an integrated whole of system implementation is anchored on two reference points:
- A clear upfront articulation of how the new health "system" will work and look like, and
- the current state and starting point of the reform
The resulting target operating model should also be clear on the interdependence and integration of the twelve essential elements of work.
A whole system integration approach requires every element work plan to show how it contributes to and is affected by the other elements. Therefore, any changes in any of the elements during implementation will affect others. There should be sufficient checks and balances to track changes and how work plans are pivoting appropriately. Too many implementations suffer from tunnel vision and dogmatically continues with the original work plan when the ground underneath them has shifted.
Appropriate use of complex, complicated, and simple approaches
Any reform implementation has to do two things simultaneously. The first is to create the new, and the second is to manage and transition out of the old. As pointed out above, designing and implementing the new system using a target operating model is a complex exercise in itself. When we add the need to manage the current system and transition to the new system, the complexity increases significantly.
Finally, when the starting point of reform is from point B (system performance on the decline and under intense pressure), the complexity becomes exponential.
However, there will be a mix of simple, complicated, and complex challenges in any reform implementation. While there may be some simple challenges, most of the challenges are complicated or complex. Successfully triaging these challenges and applying the right approach is the difference between progress and failure. Simple problems lend themselves to "best practices” solutions, while complicated ones may require a portfolio of "good practices," Complex challenges solutions, on the other hand, have to be "discovered."
Complex challenges have multiple, diverse, constantly changing, and new variables. Solutions discovered for complex situations are not easily scalable because the variables driving the complexity are continually changing. Therefore, a complexity approach to meeting these multi-layered and dimensional challenges requires:
- a discovery mindset to try new ways of doing things
- having a portfolio of initiatives rather than putting all the bets on a single program
- accept that mistakes, and U-turns are part of a discovery process
- ability to learn and pivot early and fast
- a high level of awareness of changes in the external and internal environmental pressures and opportunities.
Too many implementation programs fail to have appropriate solutions for simple, complicated, and complex challenges and inappropriately introduced “borrowed” best or good practices to solve complex challenges.
Final word
Embarking on a major reform at point B of a system performance curve is very high stakes. If it goes wrong, the current health service gaps, fiscal deficits, and inequalities will go into deep dive. That is why this paper focuses on what it takes to have a successful implementation.
This latest reform agenda for the New Zealand health system is ambitious, aspirational, and audacious. No reform agenda is perfect, and the current reform agenda is seen as bold by some and reckless by others. Suppose it successfully addresses current inequalities in health outcomes for Maori and Pasifika and improves the health outcomes for all New Zealanders. In that case, history will remember this reform as bold. Otherwise, this reform will be remembered as reckless.
What will separate the legacy of boldness and recklessness? Finding the right talent and leadership that understands and focuses on the above three fundamentals as the reform enters the implementation stage.
Chai 。仁材 Chuah 蔡
Wellington, New Zealand
11 th May 2021