Source: Radio New Zealand
General practice owners are frustrated with what they call “bloated bureaucracy” at primary health organisations. RNZ
- General Practice Owners Association moves to set up another PHO after big corporates do likewise
- GenPro says it’s responding to demand from members fed up with red tape and costs
- PHOs say GPs already get 100 percent of patient funding but they have a bigger mandate
Frustration among general practice owners with what they call “bloated bureaucracy” is behind a move to set up a breakaway nationwide primary health organisation (PHO).
The General Practice Owners Association (GenPro), which has made an application to Health NZ, said it would ensure more money for frontline patient care.
Its chair, Dr Angus Chambers, said the new entity would be a standalone organisation, enabling GenPro to continue to advocate for its members without any conflict of interest.
“GenPro is not and will not be a PHO. But we’d welcome a lean, cost-effective PHO for GenPro members that reduces the bureaucratic burden on the health system and facilitates greater funding for high-quality, sustainable, accessible, and equitable front-line patient care.”
PHOs are not-for-profit organisations, funded by Health NZ to oversee primary care, including general practices.
There are currently about 30 PHOs, made up of practices working together to care for the patients enrolled with them.
GenPro chair Dr Angus Chambers. Supplied
GenPro’s move comes in the same week that Green Cross became the second big corporate to receive approval from Health NZ to set up its own PHO.
Its 54 practices – which are currently distributed among multiple PHOs – will shift to a stand-alone entity, Community Care Ltd, from 1 July 2026.
Another corporate provider, Tend, started operating its own PHO in July after receiving approval in May.
Chambers said his members feared this would give the corporates a competitive advantage.
“There’s a lot of concern among our members that we’re heading towards a duopoly like the supermarkets in primary healthcare, and we want to see the settings changed to prevent that because it’s not good for consumers.”
A report by retired accountant Murray Lilley earlier this year highlighted the growth in “bureaucracy” within PHOs, and suggested they were siphoning off too much government funding before it reached frontline GPs.
The Lilley report was criticised for ignoring PHOs’ role in population health, including programmes for mental health, diabetes, immunisation, sexual health, smoking cessation and community radiology.
Chambers said while he was not sure that all the conclusions drawn from the report were accurate, it did “mirror concerns” among some GPs regarding PHOs, especially around “transparency”.
“Many feel we’re struggling, some have borderline viability, and we see PHOs growing and that really concerns our members.”
Current policy settings and existing PHO structures had significant problems, he said.
“These include conflicts of interest between patient care and commercial operations, bloated governance and management costs, a focus on accumulating reserves instead of funding front-line services, regional variations creating a postcode lottery, and trust issues.
“The new PHO will aim to address these challenges head on.”
PHOs respond
General Practice NZ chair Dr Bryan Betty. Supplied
General Practice NZ, which represents PHOs, said as registered charities, they were set up for transparency and obliged to publish audited accounts.
Its chair, Dr Bryan Betty, a Porirua GP, said PHOs were not simply responsible for passing on capitation funding (the funding for enrolled patients), but also for delivering wider population health activities.
“At the moment 100 percent of capitation gets passed through directly to practices and the majority of what we call ‘flexible funding’ [for mental health, diabetes and a range of other services] also gets passed through to general practices.
“But what remains in the PHO is for things like practice support: data and digital, supporting high needs practices that may be marginally sustainable, to ensuring things like interpretation services, transport for rural patients – a whole range of services that practices may not be able to provide on their own.”
There were some problems with the current funding mechanisms, he conceded.
“There is a need for more funding to be flexible to support patients across a region to access timely medical care, to access immunisation, screening, and other primary care services.
“Most individual practices can’t afford specialist diabetes nurses or podiatrist, for instance, they need to work across a group of practices.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
