Covid health costs reach $7m

The cost of Covid-19 continues to hit Nelson Marlborough Health’s budget, with figures showing $7 million was incurred during the 10-week response.

General manager of finance, performance and facilities Eric Sinclair said in a report to the board that the Ministry of Health would cover $3.4m for a range of activities including GPS, the costs of running the region’s five community-based assessment centres and some public health work.

However, that left a ‘‘significant level of costs unfunded’’.

Sinclair said there were a number of costs that had not been incurred, due to the lower levels of activity in hospital.

As some of those costs would be incurred at some point in the future, they had not been accounted for as ‘‘savings’’.

Sinclair said when the planned care catch up activity occurred, it would be covered by separate funding.

Nelson Marlborough Health’s share of that had yet to be announced by the Ministry of Health.

Sinclair said the $7m Covid-19 related spend fell into several categories, not just the DHB’S response activities. They were:

The costs associated with the pandemic response such as; contact tracing, the establishment of the community testing centres and the provision of personal protective equipment.

The costs of special leave granted when a staff member was not able to work, either in their usual location or from home.

Revenue lost due to the inability to perform services, including private surgery arrangements at Wairau Hospital.

Additional costs, including $906,000 related to annual leave that would normally have been taken through the 10-week lockdown period.

A further cost, not accounted for in the $7m, was between $700,000 and $1m for inter-district flows, where patients were treated at other health boards.

The board had planned for a $450,000 deficit in May. It incurred a deficit of $11,000 on business as usual expenses which Sinclair said was ‘‘pretty much a break even result’’ with a total deficit of $2.1m when the Covid-related costs were factored in.

That brought the financial result for the year-to-date to a deficit of $10.2m, against a planned deficit of $4.7m.

At a health board meeting, board member Stephen Vallance asked if staff were now taking annual leave as normal in level 1.

Chief executive Peter Bramley said they were trying to encourage staff to take leave where they could.

Board member Gerald Hope said the recovery costs associated with Covid were accruing daily, or ‘‘by the hour’’ and asked Sinclair if he had any idea where the deficit across the DHBS was likely to land.

Sinclair said other than being ‘‘significantly higher than the planned result for the year’’ he did not know.