RAJ REPORT

Will Activity Based funding lead to ‘skimping’ on costs or quality at Cairns Hospital and should Doctors worry——————-The principle of ABF provides that each patient’s hospitalization is funded by a pre-determined amount whose level is set according to the characteristics of the patients and the type of services provided by the hospital

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The principle of ABF provides that each patient’s hospitalization is funded by a pre-determined amount whose level is set according to the characteristics of the patients and the type of services provided by the hospital. For example, a hospital receives more funding for a kidney transplant than it does for a normal delivery of a baby. This policy leverages hospitals economic interests by allowing hospitals to retain the difference between the funding level and actual cost. In theory, cost efficiencies are sought by shortening the length of stay and changing the mix of labor and non-labor inputs to hospital care. The biggest criticism of ABF is that by minimizing cost, hospital quality may suffer by ‘skimping’ on costs or quality. – See more at: http://umanitoba.ca/outreach/evidencenetwork/costs-and-spending/costs7#sthash.pnwF1X4W.dpuf

 

 

 

Costs7 | Evidence Network.

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