IPAs and PHOs



What IPA (Independent Practitioner Association) or PHO (Primary Health Organisation) does the practice belong to?

Answer = NONE, as I have a dislike of bureaucracy and although capitation would significantly increase the practice income, it would increase the compliance costs and reduce our independence.
However, we were part of CareNET, a Primary healthcare network of 300+ NZ GPs who rejected managed care.

It became "politically correct" to support the PHO (Primary Health Organisation) concept without a clear understanding of the need for this further increase in bureaucracy, the dangers of political control and the further inequalities it would create, as well as an accelerated loss of doctors from New Zealand, particularly from rural NZ. I had thought I was "a voice calling in the wilderness", but in 2002 a rare "Red Letter" was been issued by the New Zealand Medical Association advising doctors to "exercise extreme caution regarding any moves to become part of or involved in a PHO".

In June 2004, a report on Primary Health Care in New Zealand concluded that while not statistically analysed, "There is little evidence that practice type systematically affects practice content or activities.....[and]......It would appear that capitated funding alone is insufficient to induce a move towards medical delegation or increase preventive activity". In other words, the millions being spent on the Primary Health Care Strategy based on capitation are not achieving the stated goals (as many of us predicted). Even more embarrassing to the government, one of the authors is Dr Peter Davis, the husband of the Prime Minister and critic of the medical profession! I wonder why it took 2 years to release??? You can see the "Executive Summary" here, where you can also download the full report "Family Doctors: Methodology and description of the activity of private GPs. The National Primary Medical Care Survey (NatMedCa): 2001/02 Report 1"

Newer studies and reports have not shown any health improvements, in fact the only clear benefit has been reduced GP fees to patients. This of course would be even greater for non-PHO practices if they got the same subsidies as they don't have the extra bureaucracy. However there are "unexpected" (but not unpredicted) adverse outcomes such as:

  • Poorer access, a logical result of reduced fees but fewer GPs. Forcing GPs to accept lower fees while requiring more administration and compliance is not the smartest way to keep GPs in New Zealand!
  • Compliance and administrative demands ballooned for providers [1]
  • Gaps in knowledge and expertise of those in goverance making strategic decisions adversely affecting GP viability. [1]
  • New inequalities (Low cost access vs interim PHOs [1], non-PHO practice patients missing all new funding
  • "The creation of a labyrinthine funding and organizational system with a variable capacity to deliver on the government's reform objectives" [2]
  • "An increase in the power and scope of preexisting doctor organizations combined with a government unable to wrest control over the setting of patient co-payment levels" [2] and
  • "An emerging lack of clarity about future directions for the primary health care sector." [2]
  • No significant improvement in Maori health outcomes, predictable as the causes of poor Maori health are not addressed by the low cost access PHO concept [3]. In fact, despite the very low cost, "cost" is still given as the main reason for failing to access GP services! [3]

Read the 2002 NZMA "Red Letter"

Read the 2004 MoH report "NatMedCa" as a pdf file

Download Acrobat Reader
(needed to read PDF files)


1. McAVOY, Brian R and COSTER, Gregor D "General practice and the New Zealand health reforms – lessons for Australia?" Australia and New Zealand Health Policy 2005, 2:26 www.anzhealthpolicy.com/content/2/1/26
2. GAULD, Robin (University of Otago) "The Unintended Consequences of New Zealand's Primary Health Care Reforms" Journal of Health Politics, Policy and Law 2008 33(1):93-115]
3. Ministry of Health. 2006. Tatau Kahukura: Mäori Health Chart Book, Public Health Intelligence Monitoring Report No.5. Wellington: Ministry of Health. [www.moh.govt.nz/moh.nsf/pagesmh/3395/$File/maori-health-chart.pdf ]

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