Economist Brian Easton says it is the professionalism – competence and integrity – of the doctors, nurses and technicians who provide the care which obscures the managerial failure

This is a re-post of an article originally published on pundit.co.nz. It is here with permission.

The column-blog, Otaihanga Second Opinion is compulsory reading for anyone interested in the health sector. It is written by Ian Powell, who was Executive Director of the Association of Salaried Medical Specialists, the professional union representing senior doctors and dentists in New Zealand, for over 30 years (until December 2019) and he has an intimate knowledge of the sector and excellent judgments.

One column, Trust Relationships and Health Systems, had much wider implications than just the health sector. It draws lessons from the extremely successful leadership team at the Canterbury District Health Board (CDHB). In an earlier column I reported its demise from excessive and insensitive interference by centralised Wellington. Powell’s column provides more background as to why it was successful.

He summarises the ‘standout’ performance of the former Canterbury District Health Board (CDHB) from the mid-2000s to 2020, when integrated health pathways between community and hospital were successful in constraining acute patient demand. They occurred because they were

... clinically developed and led by health professionals working in both community and hospital care. It would not have happened without a strong focus on relationships leading to trust in order to enable an engagement culture to develop that was previously missing. Decisions were based on what made best clinical sense in many different branches of medical care. The engagement culture that led to this outcome, and was strengthened by it, provided the basis for CDHB’s outstanding response to the post-2011 earthquake health crisis.

Powell’s column was agreeing with an article by Ian McCrae, who was founder and former CEO of Orion Health: Bugger, I'm the New Minister of Health, which also drew lessons from the CDHB experience.

It then reports an insightful comment to McCrae’s article by a prominent Canterbury surgeon, Saxon Connor:

This is spot on. But what it doesn’t allude to is that the approach didn’t happen by chance. There was almost a decade of ‘trust building’ that allowed a system network to develop which embraced change based on underlying values of respect, empathy and psychological safety.

However my observation is since the change we have seen loss of those networks, trust and respect. People are now disengaging on [a] daily basis. The old way of working cannot simply be turned back on. It will require starting from scratch to rebuild trust. Paraphrasing David Meates [former Canterbury chief executive] “Change can only happen at the speed of trust”. I don’t think people quite yet understand what they have lost from the Canterbury health system over the last two years.

The trust did not occur overnight. Powell says it took longer than a decade. The turning point was the 2006 arrival of a new, very experienced, chief executive, Gordon Davies, who knew the health system well and understood the importance of both relationships and good engagement with health professionals. His work was built upon by his successor, Meates, whose leadership finished in 2020, when the Wellington approach made it impossible for him and his senior leadership term to continue.

Powell places trust at the centre of his diagnosis, but lurking underneath is the professionalism of those involved; you trust your healthcare because of the competence and integrity of the doctors and nurses treating you.

Critical to this analysis is the notion of the ‘principle of subsidiarity’, that is central government should only perform those tasks that cannot be performed at a more local level. That does not only apply to central government. Anywhere in a hierarchy, subsidiarity says activities should be delegated to the lowest possible level. Sure, they are going to make mistakes down there, but so do those higher up – bigger bogups.

It is a cultural issue. You cannot impose trust and good working practices. They develop from the bottom. Centralisers have tried; Stalin and his goons did not succeed at all. Our central institutions have done little better.

The above discussion is about the health system. It leaves one very gloomy about the success of Health New Zealand (Te Whatu Ora). If it does succeed, it is going to take a long time, longer than the tenure of any Minister of Health or Chief Executive. It will involve subsidiarity, having faith at the local level. That is almost exactly the opposite to the ambition which led to the creation of HNZ, and the destruction of the DHB system.

Certainly there are things which need to be done nationally, like developing a national IT system (which the DHBs had already been trying to create, but at a snail’s pace). Ultimately the task is about creating a culture of professionalism and trust at the grass roots. The centre cannot deliver it by itself.

The lesson should not be lost in other sectors of government, especially given that the approach based on generic management is almost exactly the reverse, with its appointments of chief executives from outside who have virtually no competence in the activities of the institution they are to run. As well as in the health system, this column has detailed examples of Archives New Zealand, the Ministry of Local Government and Statistics New Zealand; there are many other instances. (Yes, there have been some successes but they are few and hardly offset by the failures.) We explicitly appoint them for a shorter period than the time it needs to evolve a culture, even if they had understood the job they were taking over. By the time a conscientious generic manager masters the underlying culture of the institution they had taken on, they are moved to another one.

This is not a cheerful conclusion. I was struck that when Meates left his job at the CDHB he was not immediately recruited by the Ministry of Health for his expertise; neither has he been involved in Health New Zealand. We have a system which rewards conformity rather than achievement.

Given the number of low talent generic managers that tells you a lot about how the centre works. Generic management is too entrenched to admit its failures and seek a better way focused on culture, professionalism and trust.

*Brian Easton, an independent scholar, is an economist, social statistician, public policy analyst and historian. He was the Listener economic columnist from 1978 to 2014. This is a re-post of an article originally published on pundit.co.nz. It is here with permission.