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| 3 Nov 2026 | |
| Media Stories |
NZ Doctor 3 November 2026
Additional funding is needed to meet the Government’s elective surgery target by 2030, or the deadline may need to be extended, according to an internal report released under the Official Information Act 1982.
The July paper, written by Health New Zealand Te Whatu Ora director of hospitals Rachel Haggerty, was released following a request by the Association of Salaried Medical Specialists.
It was prepared in response to a Te Whatu Ora board request for advice on balancing public hospital delivery and outsourcing to the private sector while meeting the Government’s planned care target of 95 per cent of patients seen within four months by 2030.
According to the report, health minister Simeon Brown also sought advice on increasing outsourcing to private hospitals to 50,000 treatments a year.
The report sets out the choice: “There is a choice for ministers and the board to either seek the additional Crown funding required to meet the 95 per cent health target by 2030 (together with internal productivity measures) or agree to delay the delivery of this target until productivity alone can produce the necessary treatments and removals from elective waitlists.”
The paper says the different options to meet the target have not yet been costed.
“The plan for 2026/27 is 223,000 elective procedures, including 44,000 (20 per cent) privately outsourced treatments at an estimated cost of $396 million.”
New Zealand Doctor Rata Aotearoa contacted Te Whatu Ora last month to establish how much it spent on outsourcing in 2025/26. Ms Haggerty said in a statement that its 2025/26 elective surgery figures were still being finalised, “so we are unable to provide a confirmed figure at this time”.
“Health NZ expects to complete a similar number of publicly funded surgical treatments through private providers in 2026/27 as it did in 2025/26, with indicative outsourcing expenditure of approximately $370 million.”
Surge in private surgery
Figures released by the New Zealand Private Surgical Hospitals Association in September show a surge in outsourced surgery by Te Whatu Ora.
Procedures funded by the health agency and performed by private hospitals rose 53.6 per cent, from 30,539 in 2025 to 46,906 in 2026. But association chief executive Chris Roberts says he doesn’t expect to see a similar increase in 2026/27.
“[Te Whatu Ora] certainly gave us every indication that they want to fund less surgery,” Mr Roberts says. “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.”
Outsourcing not without risks
Ms Haggerty’s paper shows there are concerns within Te Whatu Ora about outsourcing.
“The use of private hospitals is not without risks. Migration of senior doctors from the public sector, reduced public training capacity, and the perceived diversion of operational resources that could be invested in public hospitals are key considerations we need to have. While the workforce risks have not materialised at scale, there is an un-resourced public hospital capacity risk to be managed.
“Public and private hospitals are not the same. Public hospitals carry the full cost of every patient treated regardless of their clinical status, while private hospitals deliver selected elective care to patients with lower complexity.”
The paper warns that expanding outsourcing beyond the number of patients suitable for treatment in lower-cost settings could increase costs and clinical risk, stretch the limited workforce across public and private hospitals, and duplicate overhead costs.
Te Whatu Ora could instead make greater use of its workforce and facilities, including Burwood Hospital in Christchurch, Auckland’s Tōtara Haumaru and additional non-acute capacity coming online over the next four years, the report says.
“Some higher-complexity treatments may be appropriate in certain circumstances (and already occur in limited cases), but only where there is clinical support guaranteed and value for money demonstrated.”
Long-term contracts not recommended
In a letter of expectation to then Te Whatu Ora chair Lester Levy in November last year, Mr Brown highlighted his desire to see more outsourcing and longer-term contracts for private providers.
But the report cautions against committing to long-term agreements beyond anticipated needs or outsourcing too much planned care in the medium to longer term, because treatment volumes are expected to peak and then decline.
“Delivering the health target actively and managing backlogs means that waitlist growth is temporary to 2029/30,” it says. “Once volumes stabilise after 2032/33, we anticipate only small increases proportionate to population growth and further complexity in care due to an ageing population.”
