Almost half of what Health NZ and ACC spent on health care in 2024/25 went to private providers, according to a report commissioned by three health unions. The Government says partnering with private hospitals is how it will get on top of surgery waiting lists.
The report, Who Owns the Health System?, was commissioned by the New Zealand Nurses Union, the Association of Salaried Medical Specialists and the Public Service Association. It was published by Public Futures Aotearoa, a coalition of unions, community groups and researchers that supports keeping public assets and services in public hands.
It puts the private share at 46.4%, or $14.8 billion of the $31.9 billion the two agencies spent. Private providers took 80% of the growth in that spending since 2022/23, the report says.
What counts as private
The report’s definition of private is broad. It takes in services delivered through general practices, community pharmacies, aged care facilities and NGOs, along with not-for-profit and Māori-owned providers. It also counts outsourced non-clinical services such as security, catering, laundry and IT.
The report itself says private provision isn’t necessarily the same as for-profit delivery. Its 46.4% leaves out clinical supplies, which Health NZ has to buy from private suppliers. Count those and the private total rises to $17.2 billion.
Within that mix, the report tracks a growing corporate share. It estimates corporate owners held 14% of general practices in 2022 and about a quarter in 2026, after US private equity firm TPG bought Tāmaki Health’s 51 GP and urgent care clinics and general practice provider Tend bought The Doctors.
That second deal has a Canterbury link. Iwi capital backed Tend’s purchase, the report says, and Ngāi Tahu Holdings, the iwi’s commercial arm, saw its stake in Tend rise to 24.7%.
Publicly funded elective surgery in private hospitals roughly doubled in four years, from $538 million in 2020/21 to about $1.05 billion in 2024/25, by the report’s estimate. The ACC figures came from Official Information Act requests. The Health NZ share is an estimate, because Health NZ hasn’t revealed what it pays private hospitals for elective surgery, the report says.
Edward Miller, the report’s researcher, says private providers borrow at much higher rates than the Government does. “In effect we are swapping cheap and transparent public debt for expensive and often opaque private debt,” he says.
In Miller’s view the pace of privatisation is no longer a creep. He says corporate providers are obliged to maximise shareholder returns, which can come at the expense of safe staffing levels, wages, training, equipment and patient care.
The Government’s case
Clearing the elective surgery backlog by partnering with the private sector is one of the five priorities Health Minister Simeon Brown set for Health NZ in March 2025. In a speech to the BusinessNZ Health Forum that day, Brown said the small amount of planned care outsourced on an ad hoc basis meant Health NZ was paying premium prices. Long-term contracts with private providers would give value for money, he said.
Brown said that, long term, he wanted as much planned care as possible delivered in partnership with the private sector, freeing public hospitals for acute needs. The system stays publicly funded, so everyone has access, he said.
Budget 2026 funds 24,000 additional planned care treatments in 2026/27. The Government’s health target results for April to June 2026 show every South Island district improved on elective treatment within four months, led by West Coast on 87.8%.
Private hospitals argue the same way. Chris Roberts, chief executive of the NZ Private Surgical Hospitals Association, says private hospitals perform more than 20,000 surgical procedures a month, and around 3,000 of those patients each month are outsourced by Health NZ. Roberts says private hospitals aren’t trying to replace public hospitals, and every patient treated privately frees up resources in the public system.
The business of private health
Stats NZ’s Annual Enterprise Survey shows the healthcare and social assistance industry made $4.5 billion in surplus before income tax in the 2025 financial year, up from $2.2 billion in the 2020 financial year.
That industry covers social assistance and privately funded care too, so not all of it comes from public money. The report also says the figure is misleadingly high, because the survey counts contractor income, which is common in specialist parts of health.
The report makes nine recommendations. One would require any private provider receiving more than $5 million a year in public health funding to publish financial statements showing how much public money it gets and how it’s used. Another is a public interest test for private takeovers of publicly funded providers, with limits on acquisition debt and profit extraction.
Health NZ buys that surgery through a national panel framework for outsourcing. Roberts says new agreements under it run for five years plus a further five, with an annual statement of work agreed with each provider.
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