Costs of patient care can be almost twice as high at some hospitals
Hospitals account for a large share of the funds Australia spends on the health sector each year. In 2011–12, about 30% of the estimated $140.2 billion that Australia spent on health was spent on running costs for public hospitals (excluding property, plant and equipment costs).
This report is the first to allow meaningful comparisons of costs for acute admitted patients in public hospitals. Through innovative development work by the National Health Performance Authority, two measures have been used to assess the relative efficiency of Australia’s largest public hospitals: Cost per National Weighted Activity Unit (NWAU) and Comparable Cost of Care. These assess the overall relative efficiency of Australian public hospitals by reporting costs against units of activity, which allow different treatments and operations to be compared fairly.
The report also provides the average cost per admission for 16 conditions and procedures, which together represent major areas of medical and surgical care, for major metropolitan and major regional public hospitals.
Data for more than 80 hospitals are included in the report and accompanying interactive graphics on the website.
The report finds:
- Some hospitals were found to have twice the average cost per unit of activity in 2011–12 compared to others in the same peer group
- The results, whether or not emergency department costs were included, are broadly the same for the two different measures, Cost per NWAU and Comparable Cost of Care
- Using Cost per NWAU: costs were more than two times higher from the hospital with the lowest cost to the hospital with the highest, ranging from $3,100 to $6,400
- Using Comparable Cost of Care: costs were nearly two times higher from the hospital with the lowest cost to the hospital with the highest, ranging from $3,700 to $6,800
- The cost of some conditions and procedures was nearly four times higher when comparing hospitals against their peers.
Data on MyHospitals including elective surgery waiting times, emergency department waiting times and time spent in emergency departments for 2013–14, average length of hospital stay for 2012–13 and hand hygiene data (Audit Period 3) were also updated.
2011–12: The cost to treat similar acute patients can be almost 2x as high depending on the hospital. The costs incurred by public hospitals to deliver a notional ‘average’ service to acute admitted patients ranged from $3,100 – $6,400. Measuring costs alone cannot provide insights into patient outcomes. This new information provides a starting point for hospitals to learn more about their efficiency opportunities. Costs that are not comparable across hospitals are not included, such as buidling and major equipment costs.