Radical health reform in New Zealand: Towards managed care

Recent reforms in the New Zealand health care system are based upon a foundation of population-based funding for area health boards implemented during the 1980s. The first set of reforms controlled growth in hospital and related services. In 1993, the second set of reforms established four regional health authorities with capped and capitated budgets responsible for the fully integrated purchasing of all health services. The authorities purchase from crown health enterprises, primarily care general practitioners and non-government agencies. Shifts in hospital administration to service management and increasing numbers of primary care physicians in managed care structure are key elements to promote cost containment and continuity of care. While the newer reforms are being implemented, the essential managed care elements of geographic service areas and the integration of levels of and settings for care are present. It is anticipated that these newer arrangements will improve health care access and efficiency.