Health inequalities have been extensively documented, internationally and in New Zealand. The cost of reducing health inequities is often perceived as high; however, recent international studies suggest the cost of “doing nothing” is itself significant. This study aimed to develop a preliminary estimate of the economic cost of health inequities between Māori (indigenous) and non-Māori children in New Zealand.
Standard quantitative epidemiological methods and “cost of illness” methodology were employed, within a Kaupapa Māori theoretical framework. Data were obtained from national data collections held by the New Zealand Health Information Service and other health sector agencies.
Preliminary estimates suggest child health inequities between Māori and non-Māori in New Zealand are cost-saving to the health sector. However the societal costs are significant. A conservative “base case” scenario estimate is over $NZ62 million per year, while alternative costing methods yield larger costs of nearly $NZ200 million per annum. The total cost estimate is highly sensitive to the costing method used and Value of Statistical Life applied, as the cost of potentially avoidable deaths of Māori children is the major contributor to this estimate.
This preliminary study suggests that health sector spending is skewed towards non-Māori children despite evidence of greater Māori need. Persistent child health inequities result in significant societal economic costs. Eliminating child health inequities, particularly in primary care access, could result in significant economic benefits for New Zealand. However, there are conceptual, ethical and methodological challenges in estimating the economic cost of child health inequities. Re-thinking of traditional economic frameworks and development of more appropriate methodologies is required.