A Comparative Study of Denmark and New Zealand’s National Health Targets

ABSTRACT

This paper investigates the influence of nationally imposed health targets on current management control practices in New Zealand and Denmark. It reveals how variants of New Public Management (NPM), arising from specific historical socio-political contexts, rise to the challenge of national differences. The study finds that both nations are challenged to ensure data registration procedures produce valid and comparable performance measures. Denmark’s reliance on a single efficiency measure of health sector performance reflects a historic socio-political context that reduces the feasibility of additional measures whereas New Zealand’s context enables the government to impose a more extensive range of health targets.

Keywords:

• hospitals
• New Zealand
• Denmark
• management control practices
• performance measures
• comparative health care

Notes

1. Since the study period there have been further changes to performance measurement practices in both countries

2. The broad historical overview of health service developments offered here is to provide a foundation for understanding current performance measurement practices rather than to give a detailed account of all changes.

3. District Health Boards are organizations responsible for ensuring the provision of health services to populations within a defined geographical area. They purchase health services by contracting with health care providers to supply agreed services in their district. There are 20 DHBs in New Zealand. More information can be found here: http://www.health.govt.nz/new-zealand-health-system/key-health-sector-organisations-and-people/district-health-boards

4. Regions administer the funding from the state to the hospitals meaning hospital finances are not centralized at the regional level. Regions also coordinate support services. For more information: http://www.regioner.dk/services/in-english

5. In New Zealand, primary care refers to private general practitioners. In Denmark primary care is mainly private or non-profit physician practices. They are not financially controlled or coordinated by the Danish regions as they are in New Zealand.

6. The research initially involved two university hospitals, one in Denmark and one in New Zealand, within close proximity to the researcher’s affiliated universities. In Denmark, CFOs of all hospitals within the mainland of Jutland were contacted and seven out of ten agreed to participate. In New Zealand, six districts on the North Island were contacted and three, those closest to the university hospital, provided access to key informants.

7. Hospital funding is based on regional demographics and volume-related DRG payments.

8. These can be accessed at http://www.health.govt.nz/new-zealand-health-system/health-targets/how-my-dhb-performing/how-my-dhb-performing-2011-12

9. Registration means recognizing which types of events to capture, when they are to be recorded, how they are to be classified, etc.

Additional information

Notes on contributors

Margit Malmmose

Margit Malmmose is an Associate Professor in management accounting in the Department of Management, Aarhus University, Denmark. Her research deals mainly with health care policy, budgets and performance measures in health care systems. Her work has been published in Critical Perspective on Accounting, Accounting History Review and the Journal of Business Model.

Winnie O’Grady

Winnie O’Grady is a Senior Lecturer in management accounting at the University of Auckland, New Zealand. She researches performance management and control systems, including beyond budgeting approaches, and evaluates their operation using the viable system model. Her work has been published in Management Accounting Research, Qualitative Research in Accounting and Management and the Accounting Research Journal.