Private lab services on shaky ground

PLANS for the mass privatisation of lab testing in the Wellington region are in disarray, with leading clinicians predicting patients could pay the price.

The Wellington region’s three district health boards were going to decide on a winning bidder to take over hospital lab services last week but have delayed the decision after one of only two bidders abruptly pulled out.

Opponents of the potential privatisation, which they say would be the biggest public health outsourcing in decades, believe it is further proof that the deal is a ‘‘dog’s breakfast’’, but the health boards have insisted the proposal is still viable.

Abano Healthcare announced yesterday its joint-venture firm Aotea Pathology was pulling out of the contract to provide laboratory testing services to hospitals and GP clinics for the Capital & Coast, Hutt Valley and Wairarapa boards, citing concerns about ‘‘clinical safety’’.

Aotea Pathology has a contract for lab work from GP referrals, which ends on October 31 this year, while lab work for hospitals is done in-house.

The withdrawal means one company – believed to be Healthscope – is bidding for the region’s pathology contract, which would see tests for everything from the flu to cancer outsourced for all patients in the region.

The plan – which would include creating a multimillion-dollar lab at Wellington Hospital – has met strong resistance from hospital pathologists. Twenty pathology leaders have written to Health Minister Jonathan Coleman and the Capital & Coast board, outlining their concerns over the proposal, saying it was ‘‘essentially a privatisation of pathology in the region’’.

They said such a complex project had not been attempted in New Zealand and there was a ‘‘high risk’’ the financial targets could not be achieved ‘‘unless current services are degraded’’.

Association of Salaried Medical Specialists executive director Ian Powell said the boards’ handling of the process was ‘‘shonky’’.

‘‘I think Aotea [Pathology] think this is a dog’s breakfast.

‘‘This would also be our assessment,’’ Powell said.

Abano managing director Alan Clarke said Aotea ‘‘very reluctantly’’ decided to withdraw from the tender process.

‘‘The structures, demands and expectations changed to the point where we believe the resultant contractor service would compromise clinical safety, would compromise Aotea’s staff and clinicians, and would not be in the interests of our shareholders.’’

Aotea staff were spoken to yesterday and advised their jobs were under threat, Clarke said.

‘‘Clearly they will be deeply, deeply concerned about what this means for them and their careers, jobs and families. It is a great sadness when a medical speciality is treated like a commodity.’’ Association of Salaried Medical Specialists executive director Ian Powell

Wairarapa and Hutt Valley board chief executive Graham Dyer and Capital & Coast interim chief executive Debbie Chin said they would continue with the integration project but would look at extending the time frame for decision-making.

Despite the withdrawal of Aotea Pathology, they still had ‘‘a viable and comprehensive proposal on the table’’, and would decide on March 6 whether to proceed to the next stage.

If the integration proposal proceeded, more than 200 frontline health board lab workers had been assured ‘‘there would be no redundancies for a minimum of 12 months from the date that any new provider begins to provide services, and they would be offered the same terms and conditions as they currently have’’.

Dyer and Chin said patient safety and quality of services were paramount. ‘‘An independent expert panel with a number of clinical and technical experts reviewed the bids and they all could meet the service quality and implementation requirements.

‘‘Our procurement process has been overseen by external probity advisers who are satisfied with our process to date. We have also had legal advice throughout the process.’’

Creeggan was one of four men on an Iroquois that crashed into a hill in cloudy conditions at Pukerua Bay, north of Wellington, on Anzac Day 2010.

The aircraft was en route from Ohakea airbase, near Palmerston North, to perform a dawn service

‘The process has been shonky.’