Reference: 20240867
22 November 2024
Rodney Parsons
[FYI request #29019 email]
Dear Rodney
Thank you for your Official Information Act (OIA) request, received on 2 November
2024. You requested the following:
Treasury is quoted as suspecting a decline in productivity as measured by a
decline in "case weights per FTE"
(https://www.nzherald.co.nz/nz/politics/documents-reveal-treasurys-warnings-
about-health-nzs-finances-and-board/MVFI6UGUDFBAXPEWAV72ZEDSCU/).
Presumably treasury is referring to the WIES measure? Can treasury confirm
this.
Can treasury also confirm that it has received advice from Ministry of Health and
Te Whatu Ora of the following:
- NZ's use of Victoria' WIES measure has morphed well beyond the intended use,
with the core structure being broken by the separate creation of the neonatal
weighting, meaning that there ceased to be a single national weighting some
years ago.
- Rather than head warnings from Australia about this weighting, NZ decided to
take a short term adjustment with multi-billion dollar consequences which have
also driven health decisions for a number of years.
- The WIES implementation effectively "broke" in mid-2022, meaning that the
current implementation is no longer valid.
- MoH has been aware of this for several years and pre-reform had a team
exploring a transition to the Australian Independent Health and Aged Care Pricing
Authority (IHACPA) National Weighted Activity Unit (NWAU), however the plan
was deprecated during the reform and doesn't appear to have been adopted.
- Due to the failed national data integration, the activity weightings have not been
reliable since 2021-22, and a simple explanation for some of the activity
reductions is loss of the data, rather than a real under-activity position.
- Along with the publicly acknowledged difficulty in tracking FTE, this means that
treasury's productivity measure is very unreliable - can treasury outline its
uncertainty calculations on that figure.
In all, can treasury confirm that it's measure of outputs (WIES) is broken, and
combined with the uncertainty around inputs (FTE), that treasury cannot be
certain what productivity levels for health actually are. Given information
uncertainty is common, can treasury disclose any Value of Information
measurements it has undertaken, and any steps taken with MoH and HNZ to
1 The Terrace
PO Box 3724
Wellington 6140
New Zealand
tel. +64-4-472-2733
https://treasury.govt.nz
rectify the health costing/weighting system.
As it stands your request for information under the OIA does not meet the threshold for
‘official information’. Official information is information actually held in some form by an
agency or Minister of the Crown. Questions that require an agency to form an opinion
or provide an explanation, and so create new information to answer the request, is not
deemed official information under the OIA. Therefore, your request is refused under
section 18(g) of the OIA, as there is no ‘official information’ held.
However, I would suggest you visit the Treasury website which details advice on the
financial performance of Health New Zealand
: Treasury advice on the financial
performance of Health New Zealand - Information release | The Treasury New Zealand
Please note that this letter (with your personal details removed) may be published on
the Treasury website.
This reply addresses the information you requested. You have the right to ask the
Ombudsman to investigate and review my decision.
Yours sincerely
Jess Hewat
Manager, Health and ACC
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