Controlling Costly Care: a Billion-dollar Hospital Opportunity Assignment

Assignment Task

Topic - According to the Grattan Institute’s publication, Controlling costly care: a billion dollar hospital opportunity“Public hospital spending is the fastest-growing area of government expenditure, but its growth can be slowed. Every year public hospitals spend one billion dollars with little or no benefit. The money is not used to provide better care. It is simply being spent inefficiently and could be better spent.”

Can you suggest two ways of cutting costs in your organisation that would not interfere with patient outcomes?

Example 1 - As an employee at a university hospital, our operational costs are closely tied to the number and types of services we provide. I propose two strategies to reduce our costs:

1. Electronic medical record.

Transitioning from paper-based to paperless medical records can significantly reduce costs associated with storage and provision of paper documents. Furthermore, hospitals no longer need to supply stationery and X-ray films for daily operations. The implementation of EMR can also eliminate unnecessary repeated tests. At times, it can be challenging to locate a specific test result in a thick physical medical record, leading to duplicate orders. By preventing this, especially for insured patients, hospitals can avoid financial losses.
This concept is backed by a study that found the cumulative net present value to be US$3,617 thousand and the benefit-cost ratio to be 1.23. The study also found that the discounted payback period was approximately 6.18 years (Choi et al., 2013). Another research has discovered that hospitals with basic EMR were found to have 12% lower average costs than paper-based hospitals (Highfill, 2019).

2. Telehealth integration.

Incorporating telehealth into our daily services, particularly in outpatient clinics, can decrease the number of in-person visits, reducing travel expenses for both doctors and patients. A reduction in outpatient appointments can lead to lower utility costs (such as electricity and water) and daily operational expenses (like consumable equipment and workforce). Additionally, with reduced travel costs for our healthcare staff, there may be an opportunity to adjust employee salaries.

Evidence has shown that the MeCare program (a custom virtual care initiative aimed at frequent users of health services with chronic condition) costs $A624 per participant per month. After implementing MeCare, the median monthly rates of emergency department presentations, hospital admissions, and average length of stay decreased by 76%, 50%, and 12% respectively (Carter et al., 2023). This resulted in a median net cost saving of $A982 per participant per month. This strategy is likely to yield cost savings while maintaining or improving patient outcomes.

Example 2 :- Cost-cutting in an aged care mental health ward

1. Lighting & TV/electronics-use hours:

Set up automatic night lights times (example: night lights are automatically switched on from 8:30pm onwards until 7am): automate safety & to reduce falls as rooms will be lit enough for patients to find their room lights, and to aid nursing staff to check on pts without the need to bring torches around.

Changing bulbs to energy efficient bulbs for long-term usage & energy efficiency
Communal area TVs have set hours they’re allowed to be on to save power & aid with sleep hygiene (example: 6:30am to 10pm on times).

Set usage times on patient devices (example: strict use from 8am to 8pm): promote sleep hygiene Long-term goal: save money on energy use, efficient sleep hygiene for patients and thus overall improvement in physical & mental health, reduction in falls.

2. Prevention of falls via working equipment & integrated falls prevention plans:

This includes having working motorised beds (that can be lowered, tilted etc), sensor mats on the bed and floors, portable/handheld call buzzers

Allied health baseline assessments within 24-48hrs of admission, such as mobility & transfer assessment, set-up of future sessions/reviews, referrals to other services.

Patient & family education on personal falls prevention plans: why the patients is a falls risk, what is in-place and indication for its uses i.e. call buzzer for any transfers.

Long-term goal: reduction in falls and costs associated with post-fall procedures (medical Officers’ time spent on falls Revies, investigation costs (CT brain, x-rays etc)), equipment that is functional in emergencies, patient & family falls education which can be utilised at their discharge location (home, Nursing home, etc).

This Medical Science has been solved by our PhD Experts at My Uni Paper.