Private hospital outsourcing surges 54%

Private hospital outsourcing surges 54 per cent but growth set to slow

NZ Doctor 29 September 2026

Essentials

• The number of surgical procedures funded by Te Whatu Ora and carried out by private hospitals rose 53.6 per cent, from 30,539 in 2024/25 to 46,906 in 2025/26.
• The New Zealand Private Surgical Hospitals Association does not expect outsourcing to continue growing at the same rate.
• ACC-funded surgery carried out by private hospitals fell 13.4 per cent over the same period, from 40,091 to 34,71

The number of publicly funded surgical procedures outsourced to private hospitals surged 53.6 per cent in 2025/26.

But New Zealand Private Surgical Hospitals Association chief executive Chris Roberts says the increase isn’t expected to continue.

Procedures funded by Health New Zealand Te Whatu Ora and carried out by private hospitals jumped from 30,539 in 2024/25 to 46,906 in 2025/26.

At the same time, ACC-funded surgery volumes dropped 13.4 per cent, from 40,091 to 34,719.

Mr Roberts revealed the figures on the last day of the association’s annual conference in Auckland last week.

Some members are concerned government spending on outsourcing may level off, he says. ACC is also reining in spending as part of its so-called turnaround plan.

Mr Roberts says Te Whatu Ora told association members at a recent webinar that it is not projecting a similar increase in 2026/27 but expects to maintain elective surgery volumes at around current levels.

“I think there remains a deeper conversation to be had over what the appropriate level of outsourcing is and which procedures are most efficiently performed in the private sector,” he says.

Private hospitals receive surgical patients from four main sources: insurers, ACC, self-funded patients and Te Whatu Ora.

Association data shows insurers funded 116,069 procedures in 2025/26, up 3.9 per cent from 111,682 in 2024/25. Since 2017/18, however, the number of procedures funded by district health boards and later Te Whatu Ora has grown 194 per cent.

Outsourcing and unintended consequences

A senior Te Whatu Ora official, who New Zealand Doctor Rata Aotearoa agreed not to name, says that while outsourcing makes sense to slash waiting lists, the amount of surgery conducted by private hospitals should fall back to pre-COVID levels in the long term. 

“We need to see more done in the public health system because we get more for our money and it’s better for the recruitment and retention of staff,” the official says. 

Health minister Simeon Brown has consistently called for greater outsourcing, including longer-term 10-year contracts for private hospitals conducting elective surgery.  

That includes the potential loss of more surgeons, anaesthetists and other vital staff from the public system to private hospitals. 

Private capacity part of target push

Speaking at the conference, Mr Brown says the Government has made “excellent progress” by working with private hospitals. Its target is for 95 per cent of people to wait less than four months for elective treatment.

“But to deliver on [health targets], we absolutely need to make sure we are maximising capacity of the entire system, and so that’s getting more delivered internally with Health New Zealand but also making sure we’re using our private hospitals to get as much done as possible…,” Mr Brown says.

New target data released last week by the health agency shows 74,136 people were waiting for elective treatment as of 30 June, down from 75,679 at the same time in 2025. Meanwhile, 72.6 per cent waited less than four months, compared with 63.9 per cent in the same period last year.