Written By:
- Date published:
1:49 pm, August 6th, 2025 - 7 comments
Categories: Economy, health, Politics, Privatisation -
Tags: health insurance, socialised medicine
Half-baked attempts to fix New Zealand’s failing health system has resulted in Aotearoa drifting into a hybrid public-private model that threatens to combine the worst of both worlds.
Because of broad political consensus that healthcare should be primarily state-funded and the complexity of dismantling the status quo, no one in power seems willing to confront the problem head-on.
Since Covid, healthcare spending has ballooned from $18 billion to $32 billion, yet the system remains plagued by underfunding, long waitlists, postcode and racial inequities, and chronic staff shortages. One in four of us lacks ready access to primary care.
The Labour government tried to resuscitate a faltering system by centralising 20 DHBs into Te Whatu Ora and creating the Māori Health Authority, Te Aka Whai Ora, but it resulted in higher costs and poorer outcomes.
National has kept the centralised model but axed the Māori authority—while throwing more money at the same systemic problems.
National’s latest move is to outsource 21,000 surgeries to the private sector. Health Minister Simeon Brown argues Kiwis just want care delivered, regardless of who provides it. “We’re making the health system work smarter,” he said. But many health professionals see this as creeping privatisation, enabling the private sector to cherry-pick simpler procedures while the public system buckles under complex care requirements.
Critics argue this approach undermines public healthcare training and worsens workforce retention. Dr Phil Bagshaw, founder of the Canterbury Charity Hospital, warns it will “hollow out” the public sector, forcing doctors and nurses into better-paid private roles. “The public sector will go down as the private sector rises,” he told TVNZ’s Q&A.
His wife, paediatrician Dame Sue Bagshaw, believes the endgame will be a munted, stunted public sector together with a significant privatised one unaffordable to most. “If you can’t afford insurance, you won’t get healthcare.”
Already, over a third of kiwis feel they need private insurance to guarantee care. But this safety net is unequal—while 36–39% of Europeans and Asians are covered, only 19–27% of Māori and 17–25% of Pasifika are. And the insurance itself is costly and often only partial.
The Bagshaws are among a group of doctors, academics and economists warning of a drift toward the U.S.-style model. In a New Zealand Medical Journal editorial, they argued for a return to a clear social contract. “Creeping privatisation… is facilitating a decline in government responsibility for secondary healthcare,” they wrote. “The current trend benefits only the wealthy and powerful.”
Instead, they suggest adopting a European model—either Scandinavia’s system funded by a high tax regime, or the social insurance models of Germany, the Netherlands, or Israel, where universal coverage is mandatory and guaranteed.
My experience of a socialised health insurance system was in Israel when I worked there as a reporter and it was a positive one. Despite Israel spending just 7.5% of its GDP on healthcare—compared to New Zealand’s 10%—its services are far more comprehensive and affordable.
In Aotearoa my wife and I pay over $1,000 a month for limited private cover. In contrast, Israeli relatives of the same age, pay just $275 for full coverage, including fully covered doctor visits and heavily subsidised prescriptions.
Dr Daniel Daliot, a family member and physician, praises Israel’s generous “medication basket,” world-class emergency care, and well-distributed hospitals. Israel’s geography and high population density helps, but even allowing for that, its system far outperforms New Zealand’s on access, quality and cost.
Yet in New Zealand, no political party dares propose comprehensive reform. Instead, we continue our drift into an unthought-through hybrid model —a patched up, under-funded public model that is undermined by a private sector that cherry-picks the easy stuff. Individuals who can afford to pay through the nose to get inadequate cover while the rest cope with a public system on life support. Welcome the worst of both worlds healthcare.
Simon Louisson is a retired former journalist, who also worked two short stints for the Green Party
“Creeping privatisation… is facilitating a decline in government responsibility for secondary healthcare…. The current trend benefits only the wealthy and powerful.”
Well of course it does. Only the wealth and powerful deserve prompt and easy access to healthcare. They're the only people who matter.
“If you can’t afford insurance, you won’t get healthcare.”
Which is already happening, and terrifying.
But a majority of the population did cast a vote knowing full well this sort of thing was a likely outcome. The ones capable of making an informed vote, that is.
Even if I could afford health insurance on a pension, they wouldn't accept my preexisting conditions.
Health has been fucked about with for decades now.
Put the doctors back in charge and run it like an actual public service. NOT a business. They are quite different things, which this lot don't want to understand. They want their private sector mates to get government money lining their pockets. The whole thing is corrupt.
“Sleepwalking” is going easy on Nat Health Ministers Coleman and Reti, not to mention Assoc. Health Minister Seymour – everything that can be privatised, will be privatised.
Found it! Wonder how many private health industry lobbyists are cuddling up to the CoC.
"Yet in New Zealand, no political party dares propose comprehensive reform."
This is unthinking bullshit from a writer who should know better.
We haven't had health reforms as major as those of the Ardern government since the invention of Crown Health Enterprises in the early 1990s.
Under Ardern's government we got stuff we hadn't had before like:
– A national cancer control agency
– Free doctors visits for all sorts of people
– A national bowel screening programme
– Investment in mental health like we hadn't had before, including rolling it out to schools
– Expansion of the role and tasks of ACC into new areas
– Huge public health investments, such as lunches in schools
– Massive declines in the smoking rates, due to higher taxes and targeted programmes
– A 20% increase in funding for Pharmac
– Successfully defending New Zealand against the biggest health crisis we've had in a century
– Eradicating the extraordinary waste of these things called DHB's, into a centralised system like we had in the 1970s
– An actual partnership approach to health with Maori with a large Maori-focused health entity
– Proper measured links between health and poverty alleviation, to hold the entire system to account
So no, Labour didn't eradicate private health insurance. And no, we're not going to model ourselves on the Israeli health system, one of the most racist and cruel in the world.
Give me a break.
Really?
There was a cost to the establishment. That does expire.
"Outcomes" were/are influenced by the COVID increase in the waiting lists. And otherwise by access to primary health care (crisis) and staffing decisions.
National is claiming to be maintaining staffing levels, but is running a deliberately slow replacement of those departing – so it can save money on staffing. This is placing stress on those who remain (who are expected to do unpaid OT to meet targets).
That impacts on performance and or staff well-being. They are burning out existing staff knowing they have an over-supply of either graduates, or nurses outside the hospital system denied pay equity to bring in.
To underline their perfidy, they also use the surplus to hold down nurses pay.
Can we compete with Canada or Oz for specialist staff leaving the US system?
For those wanting more information view the Green Party of Aotearoa New Zealand 2025 budget Acc policy section and their Health budget section here: https://www.facebook.com/share/p/1AXQWfiFzH/
Also you can view their ACC Health and Disability policies here.
https://www.greens.org.nz/accident_compensation_policy
and health here
https://www.greens.org.nz/health_policy
Disability here..
https://www.greens.org.nz/disability_policy
Thank you to those of you who have voted or viewed and for participating in this poll.
https://www.facebook.com/groups/171564126882442/permalink/1600509780654529
Once again can you PLEASE PLEASE SHARE IT.
This whole discussion is about creating a primary, disability, aged care and medicines funding and supply agency FIT FOR THE 21ST CENTURY.
Please supply your input.
Let's face facts about the current separated systems model that is no longer fit for purpose. In most cases treated as secondary to the hospital sector when health issues arise as is the case now. Where is the discussion ON PRIMARY CARE and UNFUNDED MEDICINES ?
1 Primary care private only owned gp clinics that are now predominantly corporate owned by 3 corporations. Due to blatant GOVT under funding of the individually owned primary care clinics.
1a A lack of a MINISTER FOR PRIMARY-CARE responsible for and dedicated to the Primary care and Aged care and funding of unfunded medicines . ( new )
2 A politically aligned funding system and hamstrung under funded Pharmac.
2a A lack of a decent sized FUND PRE- PHARMAC FUNDING mechanism that allows unfunded Pharmac options for investment meds to be supplied when you need them.
Hence the idea of the $5 medicare levy through the green parties new reformed ACC to fund unfunded meds.
3 A PUBLIC and PRIVATE Hospital system hamstrung by blatant under funding for 40 years. Which has led to a 45% reduction in both Public and private hospitals and beds since 1980
4 A mental health system on its knees.
THESE SYSTEMS MUST CHANGE.
By participating in this poll you are helping to make that change possible.
It is great to see after 12 years of campaigning for this people are now beginning to look outside the box for answers to our serious health servicing crisis.
As I said to Kahurangi Carter at a Green Party christchurch meeting last Monday night "for too long medicines funding and primary care have been treated as the poor cousin of the health service".
Lets' face facts the fastest way to take pressure off the hospitals is to Fix the primary care and medicines funding and distribution model and the dynamics of how Pharmac and primary care works and is funded.
Primary care and medicines funding and distribution need a dedicated agency to make that happen.
The time for this to happen is now for several reasons.
A remodel of Gp clinic funding is happening in the background plus more clinics are needed.
A Pharmac stage 2 report has just been handed in and Pharmac's culture needs change.
A means to encourage and fund Nurses, Doctors and other Medical students and keep them in NZ after finishing study needs to happen.
So please discuss this with family and friends and share the poll.