Te Whatu Ora, Health New Zealand is New Zealand's public sector health care system and is responsible for the provision of primary, secondary and tertiary care to eligible citizens and permanent residents of New Zealand. It runs the pathology services in Auckland which are divided into two separate laboratories; Lab Plus for tertiary and quaternary pathology services and Community Anatomic Pathology Services, or APS, which services primary and secondary healthcare providers including general practitioners and private hospitals and medical practices.

Community Anatomic Pathology Services (APS)

APS was established in 2015 and is relied on by about a third of the population to test hundreds of thousands of tissue and anatomic samples a year, to detect diseases and serious conditions. It is now facing serious difficulties with excessive demand upon its services fuelled by population growth and increased private medical practice.

A representative of Te Whatu Ora commented that the overall increasing demand is greater than the capacity of the service to cope. Demand had leapt by a third between one quarter in 2022, to the same quarter in 2023. One factor was an increased volume of private surgery being carried out by 600 specialists in the region and 2000 general practitioners, with up to 450 histology cases a day.

That is in part due to public hospitals outsourcing more operations to private surgeries as a way of dealing with demand for planned care. Those private practices then send their samples to APS. Another issue is the rise in population. The backlog has hit turnaround times for processing samples, which had been deteriorating.

PWC Report into APS

The 2021 report by consultants PwC, now disclosed to the press under the Official Information Act (OIA) showed that APS was plagued with problems from the start. It was set up in 2015 in such a rush and under such pressure, that for the next six years it suffered from a dearth of planning, auditing and lack of even basic quality controls. "No service specification was drafted prior to, nor in the six years following, establishment of APS," the report said. Te Whatu Ora said it has since adopted recommendations from independent occupational hygienist experts, made the work spaces safer and staff were using better respiratory PPE.

In the muddle of the overhaul of lab services nationwide after 2009, planners totally underestimated the demand on APS, and failed to understand the increasing complexity of cases referred to APS. Laboratories which do both clinical pathology and histology testing, generally rely upon the rapid and automated processing of blood and urine samples to fund costs. Clinical pathology is highly automated and traditionally profitable, while the tissue testing work of anatomic pathology is almost wholly manual, labour-intensive, and therefore more costly. The splitting of the two services in Auckland has duplicated administration and created operating costs 20-40% higher that expected. Overall, this has resulted in an underestimate of the true costs required to run the service and an overestimation of the potential savings that could be achieved.

Additionally, In its first six years of operation, the lab "consistently" failed to achieve its turnaround targets, which progressively increased. Recently it has taken steps to improve that with the implementation of teamwork around the region, facilitating the dispersal of work around city and country which has produced significant improvements. It now regularly hits the target to issue a final report within 15 days, in 98 percent of cases, and 90 percent within 10 days. However, it was still scoring only 71 percent, against a target to turnaround 80 percent of cases within five days.

PwC concluded that the funding model was broken and had to change, arguing that effectively the public system was subsidising private patients. The funding model had since changed, with allocations "now made on a needs-based approach, at a national and regional level.  Despite the pressure, the lab's accuracy remains high.

The OIA response included a rundown of incidents this year; these are occurring at a rate of about six a week, however, nearly all of them are minor, most commonly where the results of tests are reported back to the wrong GP or surgeon. These incidents are promptly corrected.

A New Laboratory for APS

In January 2024, the board of Te Whatu Ora will meet to consider plans for the construction of a whole new purpose built laboratory for APS. A business case is also in preparation to set up an electronic ordering system to cut down on manual processing errors.