Via David More’s blog…
Source: http://www.abc.net.au/technology/articles/2013/09/19/3852140.htm
Full article: ABC Feature Telehealth_ The healthcare and aged care revolution
Australia’s ballooning health spend
According to the Australian Institute of Health and Welfare, the country spent over $121bn on healthcare between 2009-10. The following year it surpassed $130bn and it’s been rising at six per cent each year – twice the growth rate of GDP.
Healthcare expenditure currently makes up 10 per cent of GDP but analysts Mark Dougan from Frost and Sullivan says that, “At the current rate, in perhaps about ten years or so, it will hit 15 per cent of GDP – mostly from public sources.” He points out that this growth rate is “unsustainable.”
According to South Australia Health’s October 2012 report:
At the time we released the 2007 South Australian Health Care Plan, if SA Health had continued spending at the same rate, then by 2032 the entire State budget will be consumed by Health alone. Our efforts to reduce growth in demand has now pushed this back to 2038. Slowing the growth in demand, however, must be accompanied by providing more efficient services in order to deliver a balanced budget…
Peter Croft from Allocate (healthcare) Software adds, “Most State governments have identified a point in the future where the growth in funding for health is going to consume the entire state budget.”
The problem is that improvements have to come from efficiency gains and not spending cuts. As Stephen Duckett and Cassie McGannon said recently in The Conversation:
Reducing health spending growth will not be easy. As Grattan’s Game-changers report last year showed, Australia already has one of the OECD’s most efficient health systems, in terms of life expectancy achieved for dollars spent. Sweeping cuts to health funding, or shifting costs to consumers, could have serious consequences. Blunt cost-cutting risks reducing health and well-being, and could ultimately lead to higher government costs due to illness, increased health-care needs and lower workforce participation.
What do we spend the money on?
The Australian Institute of Health and Welfare published the following:
On an average day in Australia…
- 342,000 people visit a GP
- 6,800 people are transported by ambulance; a further 900 are treated but not transported
- 71,000 km are flown by the Royal Flying Doctor Service and 107 evacuations performed
- 23,000 people are admitted to hospital (including 5,000 for an elective surgery)
- 17,000 people visit an emergency department at larger public hospitals
So how much does do these things cost?
Hospital Stays
The Conversation points out:
“The biggest and fastest-growing spending category in health is hospitals – they get almost $18 billion in real terms more than in 2002-03, an increase of over 95%.”
Feros Healthcare puts the cost at $967 per patient per night.
Source: Feros Healthcare
Around 11.8 per cent of all people (2.6 million) had been admitted to hospital in the last 12 months (Source: Australian Bureau of Statistics).
Nationally, the average stay is six nights (see diagram)
Source: South Australia’s Health’s Response Oct 2012
So the annual cost of Australian hospital stays is roughly:-
2.6 million Admissions x 6 nights x $967 per night = $15.1bn each year.
Many telehealth proponents state that most of the people in hospitals are there to primarily be monitored. If that is the case, with a reliable internet connection, a number of those patients could be monitored from home (where they’ll recuperate quicker) and that would reduce the cost to less than $10 per day while freeing up beds for other people. In this instance, a hypothetical reduction of just 10% would be worth over $1.5bn per annum on its own.
However, the matter is not undisputed with some doctors adamant that the vast majority of patients that are being monitored in hospital are there because they still require hospital care. There are certainly many anecdotal examples of long-term hospital residents who could be monitored from home. However, the limited available figures don’t highlight their numbers as significant. This report from 2006-07 lists the main reasons for which patients were hospitalised (along with the costs of doing so). Many conditions don’t lend themselves to home monitoring.
In the spirit of open journalism, if you have any relevant personal experiences on this matter, please leave them in the comments below.