New Zealand Public Health and Disability Act 2000

The New Zealand Public Health and Disability Act 2000
This page provides an introduction to the New Zealand Public Health and Disability Act. You can view the Act online at www.legislation.govt.nz or purchase it from Bennetts bookstores.

Summary of the Act

The New Zealand Public Health and Disability Act 2000 (NZPHD Act) establishes the structure underlying public sector funding and the organisation of health and disability services. It establishes District Health Boards, and sets out the duties and roles of key participants, including the Minister of Health, Ministerial committees, and health sector provider organisations.

The NZPHD Act also sets the strategic direction and goals for health and disability services in New Zealand. These include to improve health and disability outcomes for all New Zealanders, to reduce disparities by improving the health of Māori and other population groups, to provide a community voice in personal health, public health, and disability support services and to facilitate access to, and the dissemination of information for, the delivery of health and disability services in New Zealand.

Introduction

The New Zealand Public Health and Disability Act 2000 (NZPHD Act) received Royal Assent on 14 December 2000, repealing and replacing the Health and Disability Services Act 1993. It also amended and renamed the Health Sector (Transitional Provisions) Act 1993 – this Act is now called the Health Sector (Transfers) Act 1993.

District Health Boards (DHBs) formally came into being on 1 January 2001. The NZPHD Act dissolved the Hospital and Health Services (HHSs) and the Health Funding Authority (HFA) and divided their responsibilities between the DHBs and the Ministry of Health. DHBs became responsible for the first group of service agreements on 1 July 2001 and the first elections to DHB Boards were held in October 2001. As at May 2002 the Ministry still retains responsibility for some inter-district and national personal health services, mental health services, Maori health services and section 88 notices, public health services and disability support services.

Government’s Objectives

The Government is committed to strengthening the public health system, achieving the best health and disability support outcomes for New Zealanders and reducing disparities between population groups. The NZPHD Act facilitates the achievement of the Government’s aims by:

establishing DHBs to take a ‘population health’ focus for their geographically defined populations
requiring the development of the New Zealand Health Strategy and the New Zealand Disability Strategy and an annual report to Parliament on the progress in implementing these strategies
encouraging co-operation and collaboration between the agencies in the sector with the aim of delivering better care and support
strengthening local community input to decision-making about health and disability support services through electing members to DHBs.

Structure of the Sector

The NZPHD Act is concerned with entities and arrangements across the health and disability sector. It focuses predominantly, however, on the creation of 21 DHBs to fund or provide services for geographically defined populations and to be responsible for public hospitals and other related services. DHBs are also responsible for needs assessment service planning. In addition to funding some services, the Ministry of Health has a key role in monitoring the funding and provision of services by DHBs. The Ministry’s role in providing policy advice and ministerial services also continues.

Governance of DHBs

DHBs are a particular form of Crown Entity known as ‘Crown agents’. Crown agents are required to give effect to Government policy and are different from Crown-owned companies. The DHB boards are responsible to the Minister of Health for:

setting strategic direction
appointing the Chief Executive
monitoring the performance of the DHB and the Chief Executive
ensuring compliance with the law, accountability requirements and relevant Crown expectations
maintaining appropriate relationships with the Minister of Health, Parliament and the public.

The Minister of Health, in turn, is responsible to Parliament for the overall performance of the health and disability sector.

DHB Board Composition

Each DHB board has up to eleven members. Every three years, seven members are elected from each DHB district by the community, at the same time as local government elections. The Minister of Health is then able to appoint up to four members to each DHB board. In making appointments to boards, the Minister:

must endeavour to ensure that:
- Māori membership of the board is proportional to the number of Māori in the DHB’s resident population, and
- in any event, there are at least two Māori members of the board.
may only appoint people with the appropriate knowledge, skills and experience to assist DHBs to achieve their objectives and perform their functions
must take into account the desirability of promoting diversity in the membership of DHB boards.

The Minister’s appointment process aims to ensure that each board has an appropriate mix of skills and knowledge, and is representative of its population. The Minister of Health also names the Chair and Deputy Chair of each DHB board.

The composition of DHB boards, therefore, balances the need for community participation, skill mix and the Crown’s partnership with Maori. The next DHB elections will be held in October 2007, using the Single Transferable Vote (STV) system.

Transparency of DHB Board Decision-making

Each DHB is accountable for ensuring that communities have the opportunity to be involved in the deliberations of DHB boards wherever possible. DHB board meetings are open to the public and the community is able to be involved in DHB planning processes through consultation on documents such as the District Strategic Plan. The community might may also have members of the Board’s statutory committees. DHB performance information (such as plans) is also publicly available. Most of this information may be found on each DHB’s website.

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The Role of DHBs

DHBs have a focus on their population. They are responsible for working within allocated resources to improve, promote and protect the health of the population within their district and to promote the independence of people with disabilities. DHBs need to consider all needs and services including prevention, early intervention, treatment and support services, and how these services can be provided to best meet the needs of the population within the funding provided.

To manage any tension DHBs may experience in their dual roles as funders and providers of services, DHB boards are required to establish three permanent core advisory committees:

a Community and Public Health Advisory Committee to advise the board on the mix and range of services that will best meet local health improvement and independence objectives recognising both resource constraints and the requirements of the New Zealand Health and Disability Strategies
a Disability Support Advisory Committee to advise the board on issues facing people with disabilities and how these can best be managed by the DHB
a Hospital Advisory Committee to provide advice on the performance of its hospital(s) and related DHB-owned services, and strategic issues associated with the provision of hospital and related services.

These committees are advisory only although the board may specify and delegate authority to committees to act on specific matters as appropriate.

Service Delivery

In meeting the health and disability support needs of their populations DHBs may either deliver services themselves or arrange for other providers to do so. The Ministry of Health also has a role in the planning and funding of some services.

DHBs work together and enter into co-operative and collaborative arrangements where appropriate to ensure the best service delivery for their populations. This includes making arrangements for services to be delivered by other DHBs, particularly where it is not sensible for specialist services to be delivered in more than a few places. The Act seeks to encourage co-operation and collaboration among DHBs to improve health outcomes.

The Ministry of Health still has responsibility for some service contracts which existed prior to the Act taking effect. The DHB establishment process is now well advanced and only a few service contracts remain to be devolved. These will become the responsibility of DHBs as they become capable of assuming greater levels of responsibility.

A new development in service delivery is the Primary Health Organisation (PHO) initiative. PHOs will encompass the range of primary care and practitioners will be funded by DHBs to provide of a set of essential primary health care services to those people who are enrolled in that PHO. Many of the health care practitioners who will be involved in PHOs already operate under existing organisational arrangements such as Independent Practitioner Associations (IPAs), Maori Provider Organisations, and rural trusts. At the moment DHBs are working with these organisations and their communities in order to find the best way to set up local PHOs. The development of PHOs is not governed by the NZPHD Act.

The Treaty of Waitangi

The NZPHD Act adopts measures that recognise and respect the principles of the Treaty of Waitangi in the health and disability support sector.

The measures are a response to the Crown’s desire to have greater Maori participation in the health and disability support sector with a view to improving Maori health outcomes, and reducing health disparities between Maori and other population groups. The measures also reflect the Crown’s overall partnership with Maori under the Treaty of Waitangi and its commitment to protecting Maori health.

The measures include:

minimum Maori membership on Boards of DHBs
provision for Maori membership of DHB committees
training for Board members to ensure they are familiar with Treaty issues, Maori health issues, and Maori groups or organisations in the DHB
a requirement for DHBs to establish and maintain processes to enable Maori to participate in and contribute to strategies for Maori health improvement
a requirement that DHBs continue to foster the development of Maori health capacity for participating in the health and disability sector and for providing for their own needs
an expectation that DHBs provide relevant information to Maori to enable effective participation

DHBs Accountability

DHBs have a range of accountability mechanisms which are commensurate with their service and fiscal responsibilities. DHBs are required to develop and make public the following accountability documents:

a District Strategic Plan which has a 5–10 year focus and which is developed in consultation with the community and endorsed by the Minister of Health
a District Annual Plan which incorporates the annual Crown Funding Agreement and the Statement of Intent, and which is agreed by the Minister of Health
regular monthly and quarterly reports against the annual plan.

Planning is undertaken within the parameters of the New Zealand Health and Disability Strategies. Each DHB is required to consider the full range of services which its population needs, while recognising that some services are still funded by the Ministry of Health.. Plans also need to reflect prudent management of Crown-owned assets, such as hospitals, and must include specific initiatives or priorities which are communicated by the Minister of Health. Plans must also show that the DHB is operating in a financially responsible manner. Each DHB is a Crown entity for the purposes of the Public Finance Act 1989 and is required to prepare statements of intent, annual financial statements, and annual reports in accordance with that Act.

The accountability framework is particularly important to ensure that DHBs do not unduly favour the public hospital and other services which they deliver over those services which are typically delivered by non-Crown owned providers (such as primary health care services, many disability support services and by Maori-for Maori services).

The Act also provides for other accountability checks on DHBs in certain circumstances. For example, if DHBs wish to undertake significant capital investments, they are required to produce business cases for the approval of the Ministers of Health and Finance. DHBs are also subject to the Public Finance Act, the Official Information Act*, the Ombudsman Act* and other similar legislation.

There may be times when sanctions need to be applied against either individual DHB Board members or the whole board. The most serious sanctions are included in the Act. The Act includes the ability for the Minister of Health to direct DHBs to:

appoint a Crown Monitor to report to the Minister on the performance of the board
replace the board with a Commissioner
dismiss board members
replace the Chair or Deputy Chair of the board.

The Minister is also able to withdraw functions from a DHB if its performance is inadequate.

Other Agencies

The Act includes arrangements for the following agencies or committees:

Pharmaceutical Management Agency (Pharmac), to secure, for eligible people in need of pharmaceuticals, the best health outcomes that are reasonably achievable from pharmaceutical treatment and from within the amount of funding provided
New Zealand Blood Service (NZBS), to manage the donation, collection, processing, and supply of blood, controlled human substances, and related or incidental matters
Residual Health Management Unit (RHMU). The Act allows for the continuation of RMHU in its previous form and for the RHMU to undertake any functions that are given to it by or under any enactment and any functions that it is authorised to perform by the Minister.
National Advisory Committee on Health and Disability Services (National Health Committee), to advise the Minister on the kinds and relative priorities of public health services, personal health services, and disability support services that should be publicly funded
Public Health Advisory Committee, to provide independent advice to the Minister and the National Health Committee on public health issues
Health Workforce Advisory Committee, to advise the Minister on how to ensure an adequate and responsive professional health workforce
National Advisory Committee on Health and Disability Support Services Ethics, to advise the Minister on ethical issues of national significance in respect of any health and disability matters (including research and health services)
National Health Epidemiology and Quality Assurance Committee, to advise the Minister on any health epidemiology and quality assurance issues
Mortality Review Committee, to review and report to the Minister on specified classes of death. The initial priority areas for review are child mortality, maternal mortality and perioperative death.

Other Mechanisms

The Act provides a number of other mechanisms to facilitate the smooth, safe, and effective functioning of the sector. For example, the Act includes provision for the Minister of Health to establish advisory committees for specific purposes and to undertake inquiries into particular issues.

Related information

The New Zealand Public Health and Disability Act 2000 (NZPHD Act) (full text of legislation at www.legislation.govt.nz)

Health Sector (Transfers) Act 1993 (also at www.legislation.govt.nz)

New Zealand's Health and Disability System