Do hospital funding changes mean patients discharged “quicker and sicker”?
There’s been a seismic shift in health policy taking place in Canada that has been largely ignored by the mainstream media and gone unnoticed by the general public. Provinces are starting to change the way they fund hospitals. This is no small change and will directly affect the care patients receive — potentially improving access to hospital care.
Ontario and British Columbia, for example, have announced initiatives to fund hospitals partially based on the services they provide and the characteristics of the patients they treat. It seems intuitive to pay hospitals for what they do, but our rural-urban divide, how we arrange specialty care in big cities, and limits to the amount we want to spend on hospital care, complicate the issue.
Under the current ‘global budget’ approach used in all provinces, hospitals receive a fixed funding amount, regardless of the types of patients they treat. The value of this approach is the power to restrain growth in hospital spending.
So what’s the problem? In a word, inertia.
Since exceeding budgets is penalized in the traditional hospital funding model, hospitals typically avoid adding services that may increase costs, which means hospitals don’t aggressively attack wait times for fear of running up a deficit.
The belief was that, in order to improve care and reduce wait times, we needed to increase staff and hospital beds. This is the most expensive option and such a move would empty provincial coffers quickly.
It’s also unnecessary.
We now have good data that indicates we are not using our current hospital beds effectively. We have too many patients in beds that can be safely discharged home — in some regions, above 15% of beds are currently occupied by those who no longer need to be in hospital — translating into thousands of “extra” hospital beds.
The changes to hospital funding in Ontario and B.C. tackle inertia head-on and employ approaches used around the world. Known as activity-based funding (
There are legitimate concerns among stakeholders that under the
This particular phrase was borrowed from early evaluations in the U.S. that indicated that elderly patients were discharged sooner under the
First, do the financial incentives of
The evidence regarding the effectiveness of
That’s ‘quicker,’ but what about ‘sicker’?
A criticism leveled against
Canada, as a late-comer to this type of hospital funding, can learn from the evidence from other countries that have adopted similar policies. Evidence from the U.S. indicates patients in
Findings from the U.K. and other European countries are more positive: there is no association with increased mortality in the
So, while some patients are discharged earlier and possibly in less stable condition, patients do not appear to return to hospital more often (readmissions) or die prematurely.
“Quicker,” yes, but “not sicker.”
Hospitals provide the most expensive type of care in our health system and are hungry for new sources of funding. While this change is one successfully used elsewhere to expand access, in Canada we will still have to make sure that quality of care doesn’t suffer — nor should priority access be granted to ‘profitable’ patients.
Other provinces are vigilantly watching the experiments in Ontario and B.C. It’s been decades since the status quo has been challenged. If access improves, quality is unaffected, and cost growth is moderate, other provinces will surely be tempted to follow a similar path.
Jason M. Sutherland is an Assistant Professor at the Centre for Health Services and Policy Research, University of British Columbia.
Nadya Repin is a research coordinator with the Centre for Health Services and Policy Research, UBC.
This guest post is provided courtesy of the EvidenceNetwork.ca and is reproduced under a CreativeCommons Attribution No-Derivatives license.