EXECUTIVE SUMMARY

2. Ministers directed officials to report back by the end of June on the criteria and processes that Ministers will use to decide whether and when planning and funding responsibilities for health and disability support services will be devolved to DHBs [SPH (00) M6/5 and CAB (00) M19/12 e and q refer].

3. The objectives are to put emphasis on preventing disease and on population health approaches, to close gaps in outcomes, to promote collaboration in the sector, and to ensure community voice and leadership. This is achieved by making DHBs responsible for the health and independence of their populations.

4. To manage risks, the transfer of funding responsibilities from the centre to DHBs must be planned, staged, and managed. A set of capability requirements on DHBs will help Ministers determine whether or not DHBs are ready to take on responsibility for planning, funding and managing the additional services, and which services should be funded nationally by the Ministry. Requirements are grouped as follows:
   1. requirements for baseline services

   2. requirements for services that carry significant quality, health or financial risks; span multiple districts; or rely on scarce planning and funding expertise (public health, disability support, tertiary services, regional mental health, and Maori and Pacific health).

5. Officials also propose indicative dates for transition (See Table 1).

Table 1. Indicative date	DHBs planning and funding responsibilities	Comment
to 30 June 2001	none (but provision of hospital and related health services (ex HHSs)	Transitional stage
July 2001	local personal health services (primary and secondary care) local mental health services	These 'baseline' services present no extraordinary risks scope to bring forward devolution dates for other services if requirements met
July 2002	DSS, Public health, Maori and Pacific Health services, regional and national personal and mental health services	opportunity to monitor performance on baseline services time to set up collaborative arrangements, frameworks and protocols Some services identified by Government will remain in the Ministry

6. Devolution of services will not be automatic, but will be subject to approval by Ministers. Some funding responsibilities may never be devolved. But there is no rational basis for determining such services up front. Some funding responsibilities may be devolved prior to the indicated dates if DHBs can demonstrate they have the required level of competency ahead of the timetable. This is particularly relevant for Public Health, DSS, Maori and Pacific Health providers: it is desirable that DHBs focus from the outset on population health, closing the gaps and understanding the Governments aims for people with disabilities.

7. Even when funding responsibilities are devolved to DHBs, the Minister can closely manage the risks, using the funding agreement, the operating environment, and powers to direct to prescribe the activities of DHBs as tightly as deemed appropriate given the capability of the DHB or the level of risk to be managed.

8. The Ministry's DHB Establishment Support Unit will coordinate the range of activities to implement the new arrangements. The iterative process that will run over the next months in preparation of the DHB transition plans will assist in finalising the list of 'baseline' services.

9. Ministers will be involved throughout the process, by:
   1. receiving regular progress reports from the DHB Establishment Support Unit and responding to issues raised

   2. considering DHB transitional plans and making decisions in November 2000 on which services can be devolved, and by when

   3. setting the DHB operating environment

   4. considering transitional DHB funding agreements and monitoring reports

   5. re-assessing the scope of DHBs' planning and funding responsibilities when future funding agreements are negotiated.

BACKGROUND

10. This paper reports back on the criteria and processes which will be used by Ministers to decide whether and when planning and funding responsibilities for health and disability support services will be devolved to DHBs [SPH (00) M6/5 and CAB (00) M19/12 e and q refer].

Objectives of sector changes and the role of district health boards

11. Sector changes are designed to place emphasis on preventing disease and on population health approaches, to close gaps in outcomes, to promote collaboration in the sector, and to ensure community voice and leadership.

12. DHBs will have responsibility for the health of the population within their districts, and for promoting the independence and participation of people with disabilities within their population. DHBs will deliver services or arrange for (and fund) private and not-for-profit providers, non-government organisations, or public hospitals in other DHBs, to do so. DHBs will be funded using a population-based funding formula.

13. DHBs will need to be sensitive to the circumstances and needs of their local communities and understand the determinants of health. The draft New Zealand Health Strategy notes that this requires comprehensive (co-ordinated and holistic) programmes that bridge the gap between public health, personal care and long term care, focusing on the settings and social contexts in which people live. It also requires DHBs to understand and respond to the circumstances, needs and preferences of their Maori communities. To this end they will be required to establish relationships with iwi/Maori in their area.

14. To take comprehensive and effective action, it is important that DHBs - once they are capable - can make decisions about which services and which providers to fund to best meet local needs. DHBs will be subject to national policy and service frameworks, quality standards and service specifications. These will be more tightly prescribed where that is important for quality and coordination, to manage health or financial risks, or to achieve specific Government policy. This will be achieved through accountability arrangements and the operating environment controlled by the Minister of Health. Responsibilities for managing the funding of some services may never be devolved.

15. As a result, some HFA roles will transfer to DHBs and others to the Ministry of Health. Ministers will manage this process, using criteria to evaluate whether DHBs are able to take on responsibility for services. These criteria - with indicative timelines - will also assist the sector in putting transition plans together.

Overview of the links to previous decisions and future work

16. Figure one gives an overview of the most relevant decisions to date and the work scheduled to clarify and strengthen the environment within which DHB establishment occurs. The criteria in this paper, and more detailed work on accountability arrangements will inform advice on DHBs' transition plans and Ministerial decisions at other key stages in the future.