RNZ Morning Report: Warnings of ‘spiralling’ health inflation with Rob Campell
Speaking on Morning Report, former Health NZ Board Chair and Kaitiaki Hauora chair Rob Campbell said health inflation is not a short-term spike but a long-standing global trend. Medical costs have consistently outpaced consumer price inflation for decades, driven by wage pressures, population growth, ageing, new treatments and better diagnostics.
“Anyone running a business or even a household knows that if costs are rising, you have to find a way to meet them,” he said. Simply matching general CPI increases will not maintain services. It means the system falls behind.
He said workforce costs are a major driver. Health professionals operate in a global labour market, and New Zealand is a relatively low payer. Recruitment pressures are unlikely to ease, and the underlying drivers of demand are not going away either. An ageing population, new medical technologies and earlier diagnosis of conditions all increase demand for services in the here and now.
He also rejected the idea that squeezing productivity further will solve the problem. While there is potential for efficiency gains, including through technology, the easy savings have largely already been taken.
Instead, he said governments must acknowledge the reality of health inflation and respond strategically. The most effective interventions are prevention and early treatment, not simply managing waiting lists once demand has already surged.
On cyber security risks following the latest MediMap breach, he said governance has not kept pace with system complexity. Fragmented and ageing systems increase vulnerability, and stronger oversight across the sector is urgently needed.
His message was straightforward: saying “we’re spending more than ever” is meaningless if funding does not match the real rate of health inflation.
You can listen to the full Morning Report interview below.
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