Every day, hospital-level care is provided in some rural areas in New Zealand, serving an estimated one in five Kiwis. However, not all hospitals are the same. Some are community-owned, either through a trust or private but ultimately run as not-for-profits. 1News looks at rural community hospitals as part of our series on healthcare in the regions.
There are 26 rural hospitals in New Zealand but, as of 2025, eight are not-for-profit hospitals run by trusts or iwi.
They are dotted from Rawene, Te Puia Springs and Dannevirke in the North Island, to Golden Bay, Balclutha, Dunstan, Ranfurly and Gore in the South Island.
Each has a slightly different financial and operating model.
Hauora Taiwhenua Rural Health Network chief executive Dr Grant Davidson told 1News, “without them, those communities would have much less access to healthcare”.
“In my mind, they’re a critical part of our health system for rural communities,” he said.
Between them, these rural providers offer up to 184 patient beds and cater smaller populations far from bigger Health NZ base hospitals like Dunedin or Invercargill.
Some have been established out of necessity as services reduced over many years under the former district health board model.
Gore Health chief executive Karl Metzler has run the Southland facility for 17 years.
“We see 10,000 people a year through the emergency department. We do over 100 primary births a year [and have] 3500 bed days.”
While the hospital had up to 20 inpatient beds, Gore’s facility also hosted dental care services, a GP centre and mole mapping.
“I think the thing I’m probably most proud of is we’ve created probably over 80 jobs over the period that I’ve been in the role,” Metzler said.
But he told 1News Gore’s unique model also had another crucial role. “All of which is aimed at purely cross-subsidising to keep the hospital afloat.”
He said, “I don’t think there’s many rural hospitals in this country that generate roughly 50% of their own revenue. And we’re pretty proud of that.”
But it still leaves a shortfall that needs to be found elsewhere, either locally or through public health.
Davidson said, “they [rural trust hospitals] have had to rely on the community to fund the difference up till now, whether that’s infrastructure or equipment or staffing. And that shouldn’t be the case.”
Metzler told 1News, “I don’t think that is right, in the current funding landscape, that trust-owned hospitals should be disadvantaged and not receive equitable funding.”
Another factor was travel times. He said patients access his hospital quicker rather than travel between 45 mins to two hours to Dunedin or Invercargill.
“Distance is always an issue with rural facilities. We shouldn’t forget that Gore is the third oldest population in New Zealand now. And so travel is a significant burden.”
Davidson told 1News, “if we remove the rural hospitals from the equation… there will be more pressure on base hospitals and/or patients won’t travel, they will get sicker and they will die earlier in those communities.”
‘We should put that to bed once and for all’
As Health NZ moved into its third year of operation, there was hope from rural providers of consistent funding long-term.
The health body undertook a recent national review of all government-run rural hospitals, plus non-profit organisations.
Known as the Rural Hospital Sustainability Project, Health NZ’s Martin Hefford told 1News in a statement: “This work is about making sure rural New Zealanders can continue to access high-quality care, close to home, now and into the future.
“While services and needs vary across the country, we heard common concerns about workforce shortages, aging infrastructure, and uneven access to diagnostics and urgent care.
“Health NZ is committed to working alongside providers and communities to strengthen rural hospitals and the essential services they provide.”
Rural providers suggest under the former DHB model that consistent funding was difficult.
Davidson told 1News, “my understanding of the figures is that they have been underfunded [under the former model].”
But he said, “some of them are already at or below the sustainability level”.
“If something doesn’t happen, we’ll see even more services removed, reduced, all the hospital stopping work altogether, which is not defendable.”
Davidson continues, “they have had to rely on the community to fund the difference up till now, whether that’s infrastructure or equipment or staffing. And that shouldn’t be the case.”
“We should put that to bed once and for all,” he said.
So what next ?
Hefford said, “we’re now developing a Rural Health Services Framework to support more consistent national expectations and sustainable funding, while still allowing for local flexibility.”
Gore’s boss was convinced a focus on the whole country as one under Health NZ could only be positive for rural communities.
He hoped it would help recognise the value in rural services.
Metzler said, “it’s going to be a hell of a lot more cost effective to fund us in an equitable way rather than to take us over.”
