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Why Public Hospitals Are Overcrowded: Ten Points for Policymakers

Jeremy Sammut
01 August 2009 | PM99
Why Public Hospitals Are Overcrowded: Ten Points for Policymakers

Beside the perennial and serious problem of ever-lengthening waiting lists for elective surgery, major public hospitals are unable to provide timely emergency treatment and unplanned admission to a hospital bed for significant numbers of acutely ill patients.

The technical cause of the hospital crisis and the nationwide shortage of acute inpatient beds is 25 years of cuts to public hospital beds, while the systemic cause is the misallocation of resources away from frontline, bed-based hospital care and the corresponding growth in the size, cost and complexity of the state government bureaucracies that mismanage the public hospital system.

Health bureaucrats and select public sector interest groups routinely claim that greater public spending on prevention and on alternative models of care will solve the crisis. These politically convenient myths and misconceptions have convinced bed-phobic state and federal governments that opening more beds is unnecessary.

This paper states the case for structural reform to ensure the Australian hospital system is equipped to cope with the pressures created by an ageing population. Policymakers should keep the following 10 points in mind:

1. Public hospitals do not have enough beds to provide a safe standard of care for acutely ill patients who require unplanned emergency admission: Public hospitals are overcrowded and unable to admit and treat patients in a timely fashion because the total number of acute public hospital beds in Australia has been cut by one-third to a level far below the OECD average since Medicare was established in 1984. Taking population growth into account, the real fall in bed numbers is even larger—a 60% fall from 4.8 public acute beds per 1,000 population in 1983 to around 2.5 per 1,000 population today.

2. Overcrowding or emergency ‘access block’ is caused by genuine demand for emergency admission by patients (particularly elderly patients) who can be treated only in hospitals: Overcrowding occurs when hospitals operate beyond a safe level of 85% bed occupancy and more patients require unplanned admission than there are staffed ward beds available. When emergency doctors and nurses are forced to care for the overflow of patients queued up on trolleys in emergency department corridors, waiting times for new patients inevitably blow out. Overcrowding is strongly associated with the increasing number of frail elderly patients with an acute medical problem who require admission to a hospital bed in an ageing Australia.

3. Bureaucratically-run public hospitals are not under-funded: The real problem is that current funding and administrative arrangements permit vast sums of taxpayer dollars to be wasted paying for bureaucrats rather than for beds. Recurrent expenditure on public hospitals has increased by 64% in real terms (adjusted for inflation) over the last decade. Between 2001 and 2005, the number of hospital administrators in Australia increased by 69%. This is an example of the ‘close a bed, open an office’ syndrome: bed numbers have been slashed while the size and cost of the state area health service bureaucracies have increased.

4. Government denials avoid the real causes of the hospital crisis: State governments accept the policy advice of self-interested bureaucrats and wrongly blame the hospital crisis on gaps in other parts of the health system. Governments have also caved in to select public sector interest groups and endorsed a range of ‘solutions’ that involve additional spending on so-called alternatives to hospital care such as boosting primary care services.

5. Hospital overcrowding is NOT caused by GP-style patients swamping emergency departments: Patients who could be treated in community-based settings or general practice clinics, and therefore do not require admission to a hospital bed, do not cause access block. Also, unrefuted studies have demonstrated that patients who present at emergency departments and are classified semi-urgent ATS 4 and non-urgent ATS 5 under the Australasian Triage Schedule (ATS) are not ‘proxy primary care patients.’ These patients are admitted to hospitals at 20 and 10 times the rate respectively than are patients from general practice.

6. Bed numbers are NOT ‘less important’: In recent decades, growth in day surgeries and falling lengths of stay have enabled hospitals to treat more patients, especially procedural patients, with fewer beds. Hospital planners therefore claim bed cuts have not gone too far and bed numbers are ‘less important.’ The assumption that continued efficiencies will make up for the falling supply of beds is an example of flawed central planning. This is erroneous in the context of an ageing population and increasing admissions by acutely ill elderly patients who require bed-based, multi-day staying medical and nursing care.

7. Rather than end the blame game, the Rudd government is blaming the wrong problems: The Rudd government is pursuing a primary care centred reform agenda that has failed to fix the hospital crisis in countries such as New Zealand. This agenda entails spending billions of dollars on a national network of GP Super Clinics offering all-hours general practice services for GP-style patients and enhanced primary care services for elderly chronic disease patients. Unfortunately, it will not take the pressure off public hospitals as promised but will waste money by duplicating existing state and federally funded programs that are already caring for the elderly.

8. Acutely-ill elderly patients are not chronic disease patients: The premise of the Rudd government’s reform agenda is that elderly chronic disease patients would receive better care in a GP clinic. But the evidence that primary care can substitute for beds is anecdotal and weak at best. Rather than evidence-based policy, this is the preferred policy agenda of community health and other select public sector provider groups that want greater funding poured into their health silos.

9. Better prevention is the problem, not the solution: The Rudd government’s wrong-headed approach is predicated on the idea the hospital crisis has been precipitated by too much focus on hospitals and not enough on prevention. In reality, the problems in public hospitals are partly attributable to the success of better prevention, which is enabling increasing numbers of people to live to older ages and deferring illness to later stages of life. Effective deferment of illness means that ‘very old’ patients will inevitably get acutely ill and require admission to hospitals. This age group will be the hospital patients of the twenty-first century.

10. Structural reform of hospitals for an ageing Australia: To equip the hospital system to cope with an ageing population and provide quality care to all age groups, the tried and failed methods of running and ruining public hospitals must be abandoned; policymakers must decentralise the administration of public hospitals and introduce flexible and responsive voucher-based methods of funding the bed-based hospital care that will be needed to care for rising numbers of older and sicker patients in coming decades

Jeremy Sammut is a research fellow at The Centre for Independent Studies. He has contributed five papers to the CIS Papers in Health and Ageing Series, including The Coming Crisis of Medicare and The False Promise of GP Super Clinics. Jeremy has a PhD from Monash University in history and has had opinion articles covering a broad range of health topics published in newspapers throughout Australia.

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