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Will paying the piper change the tune?
Jason M Sutherland1, Morris L Barer, Robert G Evans
1Assistant Professor, Centre for Health Services and Policy Research, School of Population and Public Health, University of British Columbia, Vancouver, BC.
Healthcare Policy = Politiques De Sante
|May 2, 2012
Summary
Provincial governments are exploring activity-based funding (ABF) for hospitals to improve efficiency and reduce wait times. However, mixed international results and significant data system needs suggest a cautious approach is warranted.
Area of Science:
- Health Policy
- Hospital Management
- Health Economics
Background:
- Provincial governments face increasing hospital expenditures and persistent issues with waiting lists and times.
- Traditional global budgets for hospitals are being re-evaluated amidst rising costs and patient dissatisfaction.
- Activity-based funding (ABF) is being considered as a supplementary model to global budgets.
Purpose of the Study:
- To evaluate the potential of activity-based funding (ABF) as a strategy for hospital reimbursement.
- To assess the feasibility and potential impacts of implementing ABF in Canadian provincial healthcare systems.
- To identify the challenges and risks associated with adopting ABF models.
Main Methods:
- Review of international experiences with activity-based funding systems over the past two decades.
- Analysis of the potential for ABF to incentivize increased throughput and efficiency in hospitals.
- Examination of the data system and reporting requirements inherent in ABF models.
Main Results:
- International results from ABF systems are highly mixed, indicating variable success.
- ABF implementation necessitates substantial information and reporting infrastructure.
- Potential for unintended negative consequences and perverse incentives exists within ABF models.
Conclusions:
- Canadian hospitals and provincial governments may lack the necessary data systems for successful ABF implementation.
- A cautious and deliberate approach is advised for provinces considering activity-based funding.
- Further investigation into data system readiness and potential risks is crucial before widespread adoption.
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