New Zealand cannot sustain its current rate of health spending and widespread structural changes to the public system are urgently needed, a report prepared for the Government says.
The report, by a ministerial review group, says New Zealand's population is aging and a shrinking workforce is funding a growing health burden, which will double in the next 20 years.
It says the existing Crown Health Funding Agency should be converted into a National Health Board that would monitor the country's 21 district health boards.
The national board would also control district health boards' funding for national services.
Services for district health boards, such as payroll administration, should be provided from a single Crown entity to avoid duplication.
The document also suggests replacing the committee charged with improving public health care and dramatically reducing the number of committees advising the sector.
Health Minister Tony Ryall is confident the creation of new agencies would not lead to more bureaucracy, but would free up cash to use for important frontline services.
Mr Ryall says the review group believes it would make sense to bring together 21 separate payrolls, IT systems, and approaches to procurement in a bulk purchasing agency.
He says Cabinet will consider the report over the next couple of months and the Government will seek public feedback on the 170 recommendations.
The ministerial review group was set up in January and is chaired by former Treasury Secretary Dr Murray Horn.
