Introduction. The 2001 Primary Health Care Strategy provided significant new government funding for primary care (general practice and related services) via capitation funding formulas. However, there remain important unanswered questions about how capitation funding formulas should be redesigned to ensure equitable and sustainable service provision to all population groups. Aim. To compare levels of chronic illness, utilisation, and unmet need in patients categorised as 'high-need' with those categorised as non-'high-need' using the definitions that are used in the current funding context, in order to inform primary care funding formula design. Methods. Respondents of the New Zealand Health Survey (2018-19) were categorised into 'high-need' and non-'high-need', as defined in current funding formulas. We analysed: (i) presence, and number, of chronic diseases; (ii) self-reported primary care utilisation (previous 12 months); and (iii) self-reported unmet need for primary care (previous 12 months). Analyses used integrated survey weights to account for survey design. Results. In total, 29% of respondents were 'high-need', of whom 50.2% reported one or more chronic conditions (vs 47.8% of non-'highneed' respondents). 'High-need' respondents were more likely than non-'high-need' respondents to: report three or more chronic conditions (14.4% vs 13.7%); visit a general practitioner more often (seven or more visits per year: 9.9% vs 6.6%); and report barriers to care. Discussion. There is an urgent need for further quantification of the funding requirements of general practices serving high proportions of 'high-need' patients in order to ensure their viability, sustainability and the provision of quality of care.
Background: Capitation formulas take into account the characteristics of the population served as a way of estimating the funding required to meet varying levels of need. Capitation is a well-established method of funding health care in many different counties, especially in primary care. In Aotearoa New Zealand (ANZ), a capitation formula has been used since 2002 to fund all general practices. However, general practices who service greater numbers of people with complex health needs may not be funded adequately using the current formula if the characteristics used in the formula do not appropriately reflect the varying needs of those enrolled. We sought to quantify the levels of funding received by general practices who serve high proportions of high needs people, in order to assess if general practices are adequately funded to do so. Method: Ministry of Health enrolment data was used to inform the demographic spread of five hypothetical 5,000 patient practices consisting of: 30%, 50%, 70%, 90% and 100% high needs people. High needs were defined as those who fit one or more of these three criteria: Māori ethnicity; Pacific ethnicity; and people residing in an area of high socioeconomic deprivation. Annual first level services payments, High User Health Card, and additional funding streams including Very Low-Cost Access, Community Service Cards (CSC) and Fees-free for under 14s were taken from the Primary Health Organisation Services Agreement contract to calculate levels of income for all hypothetical practices. Results: Age is a strong determinant of capitation funding. Practice level funding does not increase in proportion to the level of needs of the populations served. VLCA funding is higher for the 70% high need then the 90% high need practice. CSC and Fees-free under 14s funding increase as the percentage of high needs people increase but not proportionally to the level of need. Conclusion: Use of age and sex as the main determinants for capitation funding shows evidence of structural discrimination within the health system. Funding schemes aimed at helping high needs populations do not always result in adequate funding for general practices to serve these communities well.
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