Hospital productivity bucks the trend

Victoria University health researchers say hospital productivity in New Zealand rose by more than three to five percent in the period between 2007 and 2009, challenging perceptions that productivity rates in the sector.

A study led by Dr Jaikishan Desai from Victoria’s Health Services Research Centre in the School of Government analysed hospital productivity over the three years by looking at the number of people treated as inpatients, outpatients or in emergency departments, for each dollar of expenditure incurred by district health boards.

Dr Desai says that importantly, the study also shows increases in hospital efficiency in the same period.

He says researchers looked at three different measures of efficiency, covering technology change, technical efficiency and allocation of staff and resources, and all showed an improvement between 2007 and 2009.

The team was surprised by the findings, says Dr Desai, and checked the analysis using three different methods, all of which showed significant improvements in productivity and efficiency.

He says there is already international interest in the findings because they run counter to widely held views that hospital productivity is falling in developed countries.

The research also shows that the length of inpatient stays is dropping and more people are instead attending outpatient clinics.

"Hospitals clearly are trying to shift towards lower cost treatments," says Dr Desai.

The study did not look at how this move is impacting on patient outcomes.

Dr Desai says the research findings are being written up for publication in academic journals.

"Internationally, there is little research on how hospital productivity changes over time despite its implications for funding of health services.

"Hospitals take a big chunk of government spending on health services so it’s important to know what value you are getting for the money."

Dr Desai says an area of concern is the limited analysis of health data that takes place in New Zealand.

"We are very good at gathering information through questionnaires and surveys but less adept at finding out what it is telling us.

"There are some very capable people with research skills, but relatively little money is allocated for analysis of health services data—much of it goes to epidemiological and medically oriented studies. It’s a shame because finding new cures and treatments is not enough—we also have to figure out the best way of delivering them to the population."

The research was done in collaboration with the University of Auckland and the University of Otago, Christchurch and funded by the Health Research Council.