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Hospitals need to spend money to save money: study

29 October, 2009

Hospitals will save health care resources worth up to $333 per patient if they adopt an intervention aimed at reducing the risk of emergency re-admissions among elderly Australians, a new study by Queensland University of Technology has found.

Health economist associate professor, Nick Graves, from QUT's Institute of Health and Biomedical Innovation, said it made economic sense to spend money implementing health programs aimed at keeping people out of hospital and from using fewer health care services.

The study titled: "Cost-effectiveness of an intervention to reduce emergency re-admissions to hospital among older patients", was published in the latest edition of the international journal Public Library of Science (PLoS ONE).

"The analysis found hospitals would need to invest $547 per eligible patient in a 24-week post-discharge care program that offered individual support including nursing and physiotherapy assessment, an at home visit, an exercise schedule and one-on-one phone contact," he said.

"If hospitals choose to adopt this intervention then re-admissions will be reduced and other health care costs will be saved."

This analysis used data collected from a randomised controlled trial conducted by professor Mary Courtney of the QUT's School of Nursing and Midwifery, which showed significantly fewer emergency hospital re-admissions among the intervention group (22 per cent compared to 47 per cent)."

"There were also significantly fewer emergency GP visits. Twenty-five per cent of the intervention group, compared to 67 per cent," professor Graves said.

He said in addition to cost savings the intervention group also showed "significantly greater improvements" in quality of life.

"A dollar valuation can be placed on the improved quality of life and so the overall monetary benefits of the intervention are close to $8000 per individual," he said.

"The intervention program represents a 'win-win' for policy-makers."

Professor Graves said the intervention would be cost-effective because it reduced the likelihood of costly hospital re-admission and use of other health care services, as well as increased health benefits.

"A decision to remain with existing practice implies higher cost outcomes and worse health outcomes and this should not sit well with those who manage health services," he said.

"The relatively low cost intervention appears to save costs and improve health outcomes. Patients are less likely to be re-admitted to hospital or a community care facility and this is a major source of cost-saving."

Professor Graves urged decision-makers in Australia to consider the economic evidence for adopting this or similar programs.

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