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New Zealand’s Health System Faces Funding Strain

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01 September 2024, 6:29 PM

New Zealand’s Health System Faces Funding StrainAotearoa’s health spending falls behind rivals.

Coasties are increasingly concerned about the funding challenges facing New Zealand's health system.


A recent analysis has highlighted the critical need for sustainable funding, moving away from crisis management to ensure long-term stability.


New Zealand’s health spending has been consistently lower than that of comparable countries like Australia and Canada, according to OECD data.


In 2020, New Zealand spent US$3,929 per capita on health, significantly less than Australia (US$5,802) and Canada (US$6,215).





This underfunding has led to workforce shortages, longer waiting times, and increased pressure on healthcare workers.


The analysis points out that while New Zealand's health system was designed to provide free and accessible services, current underfunding is threatening this goal.


The original 1938 Social Security Act, which established the publicly-funded system, aimed to ensure that all citizens had access to health care.


However, today, primary health care is unaffordable for around one in eight New Zealanders.


The system’s two-tiered design, which allows for private practice alongside public services, exacerbates inequities in access.


Those with higher incomes can access services more quickly through the private sector, leaving others to wait in the public system.


Experts warn that a shift towards increased private funding could further strain the public system.


International examples, like the United States' private insurance model, show that such systems often lead to higher costs and less equitable access.





Similarly, social insurance models, while used in countries like Germany and the Netherlands, also face higher administrative costs.


Addressing these challenges requires not only adequate funding but also investment in the people who keep the system running.


Healthcare workers, already under pressure from the ongoing impacts of COVID-19, need more support to continue providing care to New Zealanders.


As the conversation around health funding continues, the focus remains on preserving the publicly-funded system that has served New Zealand for over 80 years, ensuring that it remains accessible and fair for all.