The organisation, which operates health services in the South Otago area and has 95 staff, released its annual report last month.
Clutha Community Health Company Ltd chairman Bill Thomson said in the annual report Clutha Health First incurred an operating deficit for the year ended June 30 this year of $197,067. This compared with a surplus of $507,991 last year.
He warned unless changes were made the organisation was looking at a deficit of more than $400,000 next year, which he described as "untenable".
"As at the end of our 2024 financial year there had been a failure by Health NZ to provide fair, equitable, adequate and certainty of continuity funding for our contracted services, and in particular maternity services," Mr Thomson said.
"This has recently been partially addressed.
"It is indeed ironic that, despite the accolades we have received over the past two years from visiting hierarchy of Health NZ, and despite the priority identified in Te Pae Ora legislation to address the inequity of access to quality health services in rural communities in New Zealand, adequate funding has not been forthcoming!"
Lobbying had been going on for more than two years but to no avail, he said.
Similar funding challenges were affecting the organisation’s general practice primary healthcare services.
"Health NZ [HNZ] and the government are failing to appropriately and adequately fund general practices throughout New Zealand."
This was resulting in the provision of primary healthcare in New Zealand being under serious threat, Mr Thomson said.
He said staff recruitment had largely been successful
Clutha Health First chief executive Gary Reed, who joined the organisation last year, said a fundamental driver of the deficit had been the decision for staff to have pay parity with Health NZ employees.
"We believe in remunerating our staff in accordance with their peers and colleagues employed by Health New Zealand in equivalent roles, recognising both their commitment to our community and the quality of care they provide.
"Unfortunately, Health New Zealand does not share this commitment. The latter has repeatedly advised the company that it has no obligation or responsibility for the salaries paid to staff not employed by itself.
"Maintaining pay parity for our staff is not just a principle; it’s a goal we are committed to supporting."
At the start of the year the business was looking at a deficit of $466,992 but measures taken internally reduced the loss.
HNZ Te Waipounamu regional commissioner Chiquita Hansen said HNZ had been working closely with Clutha Health First and recently confirmed a 5% funding uplift for contracted rural hospital inpatient services, which included Clutha Health First, from July 1 as part of its Rural Hospital Sustainability project.
"We have also recently provided additional support for the primary maternity services in the Clutha district."
