Christchurch Hospital costs blowout puts jobs on the line

  1. Christchurch Hospital costs blowout puts jobs on the line
    02 June 2004

    Job losses are on the cards at Christchurch Hospital as bosses seek to rein in "unacceptable" spiralling costs.

    As deficits hit $8.2m for the year ending April 30, the hospital's financial crisis was compromising the entire Canterbury District Health Board, the board's health advisory committee was told yesterday.

    The hospital's budget over-runs have skyrocketed in a matter of weeks, with the year-end shortfall now forecast to be $9.3m, almost $1.5m more than that projected about a month ago.

    Clinicians are being asked to cut patient services by reducing outpatient follow-up visits – for which the hospital was working above its contract – and those on the list for resource-costly surgery will face further waits.

    Christchurch Hospital general manager Jim Magee said the board would do all it could to prevent staff cuts, but it was one option being considered.

    "It has got to be on the cards given that we're looking at a fairly big reduction in expenditure to keep in budget."

    Cost-cutting moves are the latest chapter in the financial crisis plaguing Christchurch Hospital over the last few months.

    According to a report prepared for the committee, the expenditure trend over the previous two months was "alarming" and both the current deficit and year-end forecast were of "distressing proportions".

    Mr Magee said a number of one-off costs had created an unexpected demand on the hospital's resources during April.

    Back-dated costs of blood products and a $200,000 increase in wages resulting from recent changes to the Holidays Act had affected the hospital's bottom line.

    The hospital also had to deal with an unexpected treatment costing about $300,000, which would be reimbursed out of the Ministry of Health's high-cost treatment fund.

    Coupled with the continued demands for acute services, a cardiology "blow out" and high costs of staffing, it was unlikely much could be done to arrest the shortfall by the end of the financial year, he said.

    Mr Magee said all elective angioplasty would be deferred until next year, and clinicians would be encouraged to cut back on the use of the high-tech and costly stents in a bid to reduce cardiology's budget.

    Patients might also find themselves back home sooner, he said.

    Health advisory committee chairman David Morrell said the entire board's budget was now in peril.

    Mr Magee said patient safety was not at risk at this stage, but was constantly under review.

    "We haven't got down to that level at the moment. If you take a good thing too far you can (risk patient safety), but we will do it within safe boundaries. If there is any change in the level of risk ... we'll be explicit about it.",2106,...8a7144,00.html
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