Public health budgets leave no room for cost-saving changes, inquiry told

Those two factors have driven down morale as well as performance in the Hunter over the past ten to 15 years, says Dr Ross Kerridge, a senior staff specialist anesthetist at John Hunter Hospital and conjoint Associate Professor at the University of Newcastle.

While a 'recent change' at the executive leadership level of Hunter New England Local Health District had improved underlying morale, and he was confident they were now heading in the right direction, it was going to take "a long, long time".

Dr Kerridge, also a member of the recently reformed Medical Staff Council at John Hunter Hospital, has given evidence at the Special Commission of Inquiry into Healthcare Funding.

He was invited to attend after making a written submission in which he called out what he described as 15 years of executive leadership that was antagonistic to, and disengaged from clinicians.

The 'huge schisms' that created led to widespread staff dissatisfaction, frustration and burn-out right across the health system, he said.

Asked to given an example of a money-saving decision which dampened morale, Dr Kerridge cited the so-called "milk crisis" of 2013.

"We had all the milk taken out of the fridges ... because the general manager found out that some people had been daring to eat breakfast at work," Dr Kerridge said.

Recently a service manager in surgery had reversed that decision, recognising it may cost "a little bit", but if it made people happier, it was worthwhile, Dr Kerridge said.

At the time (December, 2013), staff were told in an email that to save money, fresh milk by the carton was being replaced by small, long-life capsules, which raised the ire of doctors and nurses and sparked retaliatory threats of ''work to rule''.

The executive director of medical services for Hunter New England Health, Professor Trish Davidson, left in January, 2023, and Michael Di Rienzo resigned from his role as chief executive a month later, in February, 2023, after 12 years.

Tracey McCosker, former chief executive of NSW Health Pathology, is the new chief executive.

Dr Kerridge said in terms of innovative change, there was not enough room or resources in the system to listen to, or research the possible positive outcomes of making, money-saving ideas, nor the willingness to 'take a risk' , due to budgetary constraints.

An example was the trialling of staffing more operating theatres, to help address the delays in getting patients to surgery.

The delay at John Hunter to get a patient for a fractured neck of femur into an operating theatre was tracking up to 48 hours, while the length of stay was also increasing, he said.

Caution about how many nursing staff were rostered to work in post-surgical wards meant there was very little slack in the system, so if a number of people called in sick, recovery went into bed block, and patients have to be held in the operating theatre to recover.

"If you had enough staff, including some extra staff for sick leave, even though that may require some extra budget ... then we could have used that time in the operating theatres (which cost) whether you use (them) or not, once staffed ... about $2,000 an hour," Dr Kerridge said.

Another cost-cutting idea that had not been put into practise involved a screening test costing about $60-70 per patient, which may be redundant in up to 75 per cent of patients.

Dr Kerridge said he and others had also tried to have data analysis completed for another change, which would involve earlier assessments of high-risk patients before they were placed on elective surgery wait lists.

For some of those people, surgery was not the most appropriate treatment pathway and the earlier those conversations happened the better, he said.

But management's overwhelming mode of operation was one of crisis management, and avoiding going over budget, which left them with no time, Dr Kerridge said.

Changing to an activity-based model of funding could provide much-needed incentive, he said.

Dr Kerridge likened the situation to an 'old analogy': "If you are up to your arse in alligators, it is difficult to drain the swamps, but the people who know how to drain the swamps are often those who were working at the coalface", he said.

Commissioner Richard Beasley SC thanked Dr Kerridge for appearing, and said he was "extremely pleased" to get the phrase 'draining the swamp' into the transcript.

The inquiry is expected to deliver its final report by the end of March, 2025

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