MARK METHERELL June 09, 2012
Welcome to the new world of public hospital pricing where a serious open heart operation will cost you, the taxpayer, $50,052.24.
That's a snip compared with the public's outlay for an artificial heart pump implanted in patients with severe heart failure. Price: $289,915.18.
For the first time, Australians are now able to learn the price of their operation in a public hospital as calculated by the new Independent Hospital Pricing Authority.
The authority yesterday issued its first ''national efficient price''. That's been set at $4808, which provides the basis for calculating 872 categories of hospital procedures and services.
The establishment of a national price for each hospital service on which the Commonwealth will base its funding to public hospitals will have ''a very dramatic effect over time'' on hospital efficiency, says the authority's chairman, Shane Solomon.
''Instead of being paid for just having your door open, hospitals will have an incentive to treat more patients and an incentive to treat those patients efficiently,'' Mr Solomon told Fairfax yesterday.
There will be additions to the price to take account of factors such as remoteness, the treatment of indigenous patients and children, as well as adjustments for such variables as length of stay and intensive care.
The new activity-based funding pricing formula will be notionally applied from next month, giving hospitals and state and territory governments two years to come to grips with the price settings before the Commonwealth begins to use it for the purposes of setting its share of hospital funding.
The states and territories, while having the incentive to tailor their hospital funding to reflect the Commonwealth calculations, can contribute above or below the efficient price setting.
To suggestions that the national price is likely to impact heavily on smaller states whose hospitals don't have the benefits of scale of NSW and Victoria, Mr Solomon said there were still adjustments to be made but he was confident that states would come to accept the national efficient price as ''one big benchmark''.
Veteran health systems analyst Dr John Deeble said his view was that the change would make ''very little difference'' to hospital operations.
NSW and Victorian health officials responded positively.
Dr Rohan Hammett, the deputy director-general of NSW Health, said activity-based funding would help communities, clinicians and governments to make more informed decisions about where health dollars should be spent.
A spokeswoman for the Victorian Health Minister, David Davis, said the pricing announcement was ''a good first attempt''.
What you'll pay:
Implant of artificial heart pump and after-care for severe heart failure: $289,915.18
Care of premature baby less than 750 grams in a neonatal ICU: $234,390.96
Complex cardiovascular surgery: $50,052.24
Hip replacement: $21,239.34
Cataract operation: $2753.06
Serious emergency department case: $1059.20
General medical outpatient service: $282.71