Roxburgh may face losing its medical centre, after it was announced today (Tuesday July 29) a significant proportion of the Teviot Valley’s rural health funding will be withdrawn from January 2026.

The funding reduction would leave the viability of the centre at risk, its owners say.

WellSouth Primary Health Organisation (PHO) CEO Andrew Swanson-Dobbs told the practice the PHO had been erroneously paying over $130k per annum of rural funding to the Roxburgh Medical Centre since 2015, HealthCentral general manager Jenaya Smith and clinical director Kate Dixon said in a joint statement.

“Andrew advised a component of this funding was only ever intended to be paid for one to two years, and that its continuation since that time has been done in error,” they said.

“We were completely blindsided by this announcement.” 

The staff said HealthCentral management had no prior knowledge that a portion of the Rural Funding was considered ‘transitional’ or at risk of being withdrawn. 

“It was not separately itemised in our contracts, correspondence, or remittances.” 

The small rural practice, which has been owned by HealthCentral since 2022, says it will be forced to review its level of service as well as patient surcharges as a result of the error.

HealthCentral said they “chose to step in to protect vital health services” for the Teviot Valley in December 2022, “during a time of crisis when the practice had been unable to recruit or retain GPs”.

They said the implications of an unanticipated $130k reduction in funding “are extremely serious for a small rural practice such as Roxburgh”.

“It is unacceptable that the Roxburgh community now faces the possibility of either losing their local health service or incurring significantly increased consultation co-payments due to Wellsouth PHO’s financial mismanagement.”

WellSouth CEO Andrew Swanson-Dobbs: The funding was continued in error for eight or so years. Photo: Supplied 

WellSouth chief financial officer Mistelle Jack told the Central App she recognised the impact of the drop in funding for HealthCentral.

“When we reviewed the rural contract, it was identified that this historic arrangement should no longer have been in place,” she said. 

“Recognising the impact of this, we got in touch with HealthCentral to explain the situation, at the same time lobbying with Health NZ about funding. As a result, we have managed to secure some interim funding for HealthCentral.”

Temporary support from Health NZ to defer the impact means the funding cut is now scheduled to take effect from January 2026 rather than July 2025.

While HealthCentral claimed there would be an 85 percent decrease in funding, Mistelle said it would actually be “a 54 percent decrease on the prior year”.

HealthCentral said it has lobbied unsuccessfully for years for an update to the way the Rural Funding model is distributed.

“It is completely inequitable, out of date and not fit for purpose. For years we have raised concerns with Wellsouth PHO regarding how this funding is allocated to practices and we are

continually told there is nothing they can do.”

HealthCentral also said its Alexandra based practice received no increase in rural funding from Wellsouth for the 2025/26 year, despite the practice expanding its opening hours and assuming responsibility for providing after-hours and public holiday care on behalf of other practices across the region, as well as visitors.

“Unfortunately this situation is no longer sustainable and will force us to review the surcharges for patients seen at HealthCentral who are enrolled at other practices and review the level of service we are currently providing,” HealthCentral said. 

“With no increase in Rural Funding, we cannot be expected to just absorb the significantly higher cost and responsibility of rostering staff on weekends and public holidays”.

Mistelle said WellSouth agreed that rural funding models are out of date, and it commissioned an independent rural review in 2024 and submitted this to Health NZ on behalf of Southern practices including HealthCentral. 

“Funding has not kept up with the cost of living and the increased population ‘rural practices’ support. WellSouth has seen an increase of over 30,000 additional patients enrolled in rural Southern practices and the same funding pool has subsequently been stretched thinner and thinner across these practices.”

She said the ‘transition’ money for Roxburgh Medical Centra has been returned to the total funding pool for all rural practices.

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