Volume 172 Issue 9

Healthcare Clinical pathway for fractured neck of femur: a prospective, controlled study Peter F M Choong, Anna K Langford, Michelle M Dowsey and Nick M Santamaria MJA 2000 172: 423-426 For editorial comment, see Swanson et al Abstract - Methods - Results - Discussion - Acknowledgements - References - Authors' details - - More articles on Orthopaedic surgery Abstract Objective: To assess outcomes of using a clinical pathway for managing patients with fractured neck of femur. Design: Prospective, pseudorandomised, controlled trial. Setting: St Vincent's Hospital, Melbourne, Victoria (a tertiary referral, university teaching hospital), 1 October 1997 to 30 November 1998. Participants: 111 patients (80 women and 31 men; mean age, 81 years) admitted via the emergency department with a primary diagnosis of fractured neck of femur. Interventions: Management guided by a clinical pathway (55 patients) or established standard of care (control group, 56 patients). Main outcome measures: Timing of referrals and discharge planning; total length of stay; and complication and readmission rates within 28 days of discharge. Results: Patients managed according to the clinical pathway had a shorter total stay (6.6 versus 8.0 days; P = 0.03), even if assessment for placement by the Aged Care Assessment Service was required (9.5 versus 13.6 days; P = 0.03). There were no significant differences in complication and readmission rates between pathway and control patients (complication rates, 24% versus 36%; P = 0.40; readmission rates, 4% versus 11%; P = 0.28). Conclusion: Coordinated multidisciplinary care of patients with fractured neck of femur reduces length of stay without increasing complications. By 2050, a quarter of Australia's population will be aged over 65 years, and the incidence of hip fractures is consequently expected to increase fourfold.1 The logistic challenge posed by this increasing incidence and the fourfold greater resources needed by patients over 65 years compared with the average patient2 will be compounded by the expected continuing decline in bed availability. Improving the efficiency of health service delivery to patients with hip fractures may help improve overall availability of acute hospital beds for other elective surgery. Clinical pathways are proposed as a means of providing high quality care in a timely and cost-effective manner. These pathways consist of treatment protocols that aim to streamline and standardise management with multidisciplinary input from medical, nursing, paramedical and administrative staff. They have been used successfully to improve outcomes after elective hip and knee joint replacement.3 This led us to examine the impact of such a coordinated approach on acute and unpredictable admissions such as in patients with femoral-neck fractures. However, surgery for acute hip fracture differs significantly from hip joint replacement as it is non-elective and patient needs and clinical course are more variable. We conducted a prospective, controlled study to assess the effectiveness of clinical pathways for improving outcomes of patients undergoing surgery for acute fracture of the neck of femur. Specifically, we examined time to mobilisation, length of hospital stay, and complication and readmission rates as indices of outcome. Methods We used a pseudorandomised, controlled study design to compare the outcomes of patients whose management was guided by a clinical pathway with those who received the established standard of care in our orthopaedic unit. As the preparation and implementation of the clinical pathway was a quality improvement initiative, ethics committee approval was deemed unnecessary. Setting and participants The study was conducted at St Vincent's Hospital, Melbourne, Victoria (a tertiary referral hospital affiliated with the University of Melbourne). Participants were all patients who underwent standard surgical treatment for acute fracture of the neck of femur (by internal fixation using compression hip screw and plate or hemiarthroplasty) at the hospital between 1 October 1997 and 30 November 1998. In this period, 126 patients were admitted with a diagnosis of fractured neck of femur. Fifteen were excluded from the study, five because they were transferred to another institution for treatment, eight because of associated medical conditions that precluded surgical intervention, and two because of a decision to undertake non-standard surgery. One hundred and eleven patients were allocated to one of two groups (control or clinical pathway) by an administrative clerk, who was independent of the study and unaware of the study hypothesis. Patients were allocated on the basis of their unit record number -- even numbers to the control group (56 patients), and odd numbers to the clinical pathway group (55 patients). A retrospective analysis of a historical treatment group (n = 118) showed a mean length of stay of 11.8 days (range, 2.6-40.0 days; SD, 7.3). To detect a reduction in length of stay of a third at a significance level of 0.05 with a power of 0.8 would require two groups, each with a minimum of 55 participants. Management regimens Management regimens for the clinical pathway and control groups are compared in Box 1. Options for discharge destinations for all patients comprised rehabilitation in an in-patient rehabilitation facility attached to the hospital or in another hospital, patients' own home (with or without domiciliary care services), hostel or nursing home. Patients were deemed suitable for fast-stream rehabilitation in the on-site rehabilitation facility if they had the potential to regain or improve on their prefracture status, were able to achieve this outcome in less than a month, and had a high probability of returning to their previous living environment. Patients who were not expected to regain their prefracture functional level, were not expected to achieve this level in less than two months or were expected to need a higher level of care than before the fracture were referred to the Aged-Care Assessment Service (ACAS) for placement in slow-stream rehabilitation, nursing home, hostel or special accommodation, depending on patient medical conditions and limitations. This service was mediated by a social worker who, together with a medical registrar, prepared the patient for thrice-weekly assessment by a consultant geriatrician which could take place on three occasions per week. Outcome measures Duration of stay: Times in the various stages of the admission were recorded prospectively. Definitions of times were: To surgery: time between admission and theatre; To mobilisation: time between surgery and the patient first walking with the use of aids; To ACAS assessment: time between submission of the referral to ACAS and first assessment by the geriatrician; and Total length of stay: time from admission to discharge from hospital. Inpatient complications: Patients were assessed daily for confusion (disorientation in time, place or person). Wound infection was defined as all wound erythema lasting longer than 24 hours. Deep vein thrombosis was diagnosed clinically and confirmed by ultrasonography, and urinary tract infection was confirmed microbiologically. Postdischarge complications and readmissions: All patients' medical records were examined 28 days after discharge to identify postdischarge complications or readmissions related to the fracture. This time was chosen as we expected the patient to have recovered significantly from their surgery by then. Statistical analyses Results were analysed using SPSS version 8.0.4 Continuous and normally distributed data were compared with t tests for independent groups. Data that were not normally distributed, such as length of stay, were transformed logarithmically before this analysis; consequently, geometric means are reported for these data. Multiple linear regression with a general linear model was used to test for interactions between groups and the variables age, sex, referral to ACAS and premorbid status. Proportions were compared between groups using the z test. P values < 0.05 were regarded as significant. Results The 111 patients comprised 80 women and 31 men, with mean age 81 years. Control and pathway patients did not differ significantly in median age (82 versus 84 years; P = 0.1), number with premorbid conditions (19 versus 18; P = 0.94), number who did not speak English (16 versus 13; P = 0.6) or were confused on admission (24 versus 22; P = 0.98). Outcomes Durations of stay Durations at various stages of the admission for pathway and control patients are compared in Box 2. No significant differences were found between the groups in mean time in the emergency department or mean time from admission to surgery. Pathway patients walked significantly earlier than control patients, but the difference (1.6 versus 2.0 days) was not clinically important. However, the pathway group had a significantly shorter total length of stay than the control group (mean, 6.6 versus 8.0 days; P = 0.03). This meant that control patients stayed 21% longer than pathway patients. After adjusting the log-transformed length-of-stay values for the possible confounding variables of age, sex, aged-care assessment and premorbid status with multiple linear regression, we found that none of these variables produced significant between-group interactions. Group (pathway versus control) remained the most significant factor influencing total length of stay. Referral for aged-care assessment Fifteen of the 55 pathway patients and 18 of the 56 control patients were referred for ACAS assessment. This referral was preoperative for three pathway and two control patients. Time from referral to first assessment by a geriatrician differed only slightly between pathway and control patients: mean times were 2.5 days for pathway patients (range, 1-8 days) and 2.8 days for control patients (range, 0-8 days). Patients who were referred to ACAS had significantly longer total stays than those who were not referred (11.7 versus 6.5 days; P < 0.001; difference, 5.2 days; 95% CI, 3.0-7.5 days). This difference remained significant when the control and pathway groups were analysed separately. However, mean length of stay was significantly shorter for pathway patients referred to ACAS than for control patients referred to ACAS (9.5 versus 13.6 days; Box 2). We explored the possibility of confounding variables for patients referred to ACAS and found that there were none, suggesting that group membership (pathway or control) was the most influential factor affecting length of stay. Postdischarge destinations were similar in pathway and control groups referred to ACAS: 12/15 pathway patients and 16/18 control patients proceeded to slow-stream rehabilitation. Discharge destinations Discharge destinations are shown in Box 2. Patients in each group were most often discharged into fast-stream rehabilitation, followed in frequency by slow-stream rehabilitation or nursing homes. Complications and readmissions There were no significant differences between pathway and control patients in numbers who were confused postoperatively (23/55 versus 31/56) and in rates of other inpatient complications (10/55 versus 14/56 patients), postdischarge complications (3/55 versus 6/56), or readmission rates (2/55 versus 6/56). Discussion We found that use of a clinical pathway for management of fractured neck of femur reduced mean length of hospital stay from 8.0 to 6.6 days, suggesting that a proactive, multidisciplinary approach can reduce hospital stay for this condition. To date, only a few studies5-7 have reported results of a coordinated, multidisciplinary approach to management of fractured neck of femur in Australia. They found, similarly to our study, that these early-intervention programs reduced the length of stay of elderly patients with this condition compared with standard care.5-7 However, actual length of stay varied greatly between studies (from 11.38 days to 32.55 days). This variation highlights the limitations in management inherent in individual institutions because of variation in local factors such as availability of ACAS and support services and patient characteristics. Length of stay in the pathway group at our hospital, which was two to four times shorter than at other hospitals,5-7 may have benefited from our on-site rehabilitation unit. Although we found that use of a clinical pathway reduced total length of stay, the change (1.4 days) was not dramatic. This may be because the strong culture of continued refinement of care in our orthopaedic department had already reduced length of stay for many classes of orthopaedic conditions, including fractured neck of femur. Nevertheless, the reduction of 1.4 days in the clinical pathway group was encouraging. Unlike a previous study,5 our study included patients with language and cognitive difficulties. This choice was made to minimise any selection bias, as patients susceptible to osteoporotic fractures are in an age group which commonly has cognitive difficulties and as our patient population includes a large proportion of non-English-speaking people. We believed that their inclusion would test the efficacy of clinical pathways in the delivery of multidisciplinary care. We observed no difficulties applying the pathway to patients who had cognitive difficulties or did not speak English. Importantly, while use of clinical pathways reduced total length of stay, we found no significant clinical difference in time to mobilisation or complication or readmission rates between the two groups. This contrasted with our earlier findings on the effect of clinical pathways in elective joint replacement surgery.3 Possible explanations for the difference include the frequent existence of unstable and often untreated premorbid conditions in patients with fractured neck of femur, which require attention during their acute admission. In contrast, patients undergoing elective joint replacement have the benefit of preadmission assessment clinics which may resolve expected medical, allied health or discharge issues before admission. Up to a third of our patients with fractured neck of femur were referred for ACAS assessment for placement. Patients who required this assessment stayed significantly longer than patients who did not, possibly reflecting their respective comorbidities and the shortage of aged-care beds in the community. While the time between ACAS referral and consultation was similar for pathway and control patients, total length of stay was four days shorter for pathway than for control patients. It is likely that the daily review of patients' health status promoted by the clinical pathway optimised their readiness for discharge and prompted more regular reviews of discharge plans by the ACAS team. Interestingly, time between ACAS referral and consultation ranged up to eight days in both pathway and control groups. Reasons for this large range were not recorded and warrant further investigation. Some authors have identified that acute care, convalescence, rehabilitation and surgery accounted for more than 90% of total costs for fractured neck of femur, and that the main factors explaining cost variation were the number of days spent in acute care and convalescence or rehabilitation.9,10 However, our study was not designed to evaluate cost-effectiveness of clinical pathways, and, although use of the clinical pathway reduced length of stay by 1.4 days, we did not quantify costs involved in administering the pathway compared with control care. The net cost-effectiveness of our pathway is therefore unknown. Despite the weakness of a limited study, we showed that a multidisciplinary approach using clinical pathways for fractured neck of femur can reduce length of stay without increasing patient morbidity. Acknowledgements We wish to acknowledge the assistance of a special grant from the Victorian Centre for Ambulatory Care Innovation and Michael Bailey, statistical consultant, Alfred Hospital, Melbourne, Victoria. References Sanders KM, Nicholson GC, Ugoni AM, et al. Health burden of hip and other fractures in Australia beyond 2000. Med J Aust 1999; 170: 467-470. Day RO, Henry DA, Muirden KD, et al. Non-steroidal anti-inflammatory drug induced upper gastrointestinal haemorrhage and bleeding. Med J Aust 1992; 157: 810-812. Dowsey MM, Kilgour ML, Santamaria NM, Choong PF. Clinical pathways in hip and knee arthroplasty: a prospective, randomised controlled study. Med J Aust 1999; 170: 59-62. SPSS Inc. SPSS Base 8.0 for Windows. Chicago, (Ill): SPSS Inc, 1998. Swanson CE, Day GA, Yelland CE, et al. The management of elderly patients with femoral fractures. A randomised controlled trial of early intervention versus standard care. Med J Aust 1998; 169: 515-518. Tallis G, Balla JI. Critical path analysis for the management of fractured neck of femur. Aust J Public Health 1995; 19: 155-159. Cameron I, Lyle D, Quine S. Accelerated rehabilitation after proximal femoral fracture: a randomised controlled trial. Disabil Rehabil 1993; 15: 29-34. Lavernia CJ. Hemiarthroplasty in hip fracture care: effects of surgical volume on short-term outcome. J Arthroplasty 1998; 13: 774-778. French FH, Torgerson DJ, Porter RW. Cost analysis of fracture of the neck of femur. Age Ageing 1995; 24: 185-189. Hollingworth W, Todd C, Parker M, et al. Cost analysis of early discharge after hip fracture. BMJ 1993; 307: 903-906. (Received 2 Aug 1999, accepted 25 Jan 2000) Authors' details Department of Orthopaedics, St Vincent's Hospital, Melbourne, VIC. Peter F M Choong, MD, FRACS, Director of Orthopaedics, Professor of Orthopaedics; Anna K Langford, RN, BN, Clinical Nurse Specialist; Michelle M Dowsey, RN, BN, Clinical Nurse Specialist. University of Melbourne, Melbourne, VIC. Nick M Santamaria, MEdSt, PhD, Senior Research Fellow. Reprints: Professor P F M Choong, Department of Orthopaedics, St Vincent's Hospital, 41 Victoria Parade, Fitzroy, VIC 3065. PeterChoongATc031.aone.net.au Make a comment 1: Treatment regimens for control and clinical pathway patients with fractures of the femoral neck Control groupClinical pathway groupEmergency departmentAssessment X-rays Orthopaedic referral Orthopaedic consultation Transfer to wardAssessment Information checklist (prefracture placement, health status, carer) Preoperative investigations (including x-ray) Orthopaedic referral Transfer to wardWard (preoperative)Schedule surgery Preoperative tests ordered Anaesthetic assessmentOrthopaedic consultation Schedule surgery Anaesthetic assessmentWard (postoperative)Strict bedrest X-ray within 48 hours Physiotherapy referral after x-ray MobiliseX-ray within 24 hours Mobilise day after surgeryDocumentationAd hoc patient progress notesSpecific pathway documentation specifying responsibilities by discipline and time frame, to be signed on task completion Coded data collection sheetMedicationProphylactic antibiotics 24h Thromboprophylaxis until discharge (low molecular weight heparin, thigh length stockings)Prophylactic antibiotics 24h Thromboprophylaxis until discharge (low molecular weight heparin, thigh length stockings)Discharge planningBegun postoperatively Depends on patient progress Discharge phone call and summary to discharge destinationBegun on admission Depends on premorbid independence level Discharge package with information on wound care, expected milestones, contact details, simple exercises, equipment for staple removal. 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Anna K Langford · Michelle M Dowsey · Nick M Santamaria

Healthcare Distribution of colorectal adenomas: implications for bowel cancer screening Fiona B Nicholson, Melvyn G Korman, Anthony I Stern and Jack Hansky MJA 2000; 172: 428-430 For editorial comment, see Mendelson & Forbes Abstract - Methods - Results - Discussion - References - Authors' details - - More articles on Oncology Abstract Objective: To determine the distribution of colorectal adenomas relative to the splenic flexure in an asymptomatic population undergoing colonoscopy, as an indicator of the number of patients with adenomas who would be missed by screening with flexible sigmoidoscopy. Design: Retrospective survey of medical records. Setting: Private endoscopy centres in Melbourne, Victoria. Subjects: All 1131 asymptomatic individuals who underwent full colonoscopy between 1 January 1995 and 31 December 1997 after referral from a bowel cancer prevention program organised by the endoscopy centres. People referred were aged either 40 years or over with a first-degree relative with bowel cancer, or 50 years or over with marked anxiety about bowel cancer. Main outcome measures: Presence and distribution of colorectal adenomas. Results: Polyps were found in 270 individuals (24%) and were confirmed to be adenomas in 138 (12%). These 138 comprised 106 men and 32 women, with mean age 54 years (range, 40-78 years). Most (86%) had a single adenoma. Position of adenomas in relation to the splenic flexure was: distal only in 85 of the 138 people (62%), proximal only in 34 (25%), and both distal and proximal in 19 (14%). Conclusions: In 25% of asymptomatic people found to have adenomas by this bowel cancer prevention program, the adenomas were found only in the proximal colon, well beyond the reach of the flexible sigmoidoscope. This distribution of adenomas suggests that screening programs cannot rely solely on flexible sigmoidoscopy. Colorectal cancer is the most common internal malignancy in Australia and the second most common cancer overall.1 One in 18 men and one in 27 women will develop this cancer during their lifetime.2 As most colorectal cancers are diagnosed at an advanced stage after symptoms develop, significant improvements in colorectal cancer mortality depend on prevention and early diagnosis. Most colorectal cancers develop from adenomatous polyps.3 If adenomas can be identified and removed, the adenoma-carcinoma sequence is broken, and colorectal cancer may be prevented.4 As adenomas usually cause few, if any, symptoms, they can be detected only by searching for them in asymptomatic individuals. While colonoscopic surveillance programs for detecting adenomas are accepted for those at higher risk of developing colorectal cancer (eg, with a family history),5 screening for the average-risk population remains controversial. In Australia, there are no population-based colorectal cancer screening programs, but the recent report from the Australian Health Technology Advisory Committee suggested pilot programs of faecal occult blood testing (FOBT) alone or in combination with flexible sigmoidoscopy.6 This combination is probably the most accepted method of screening for average-risk colorectal cancer. However, as adenomas and cancers may occur on the right side of the colon, and as not all of these bleed, they could be missed by this combination of tests. In 1991, some private endoscopy centres in Melbourne, Victoria, developed a Bowel Cancer Prevention Program. We aimed to determine how many asymptomatic people who underwent colonosocopy as part of this program had adenomas in the proximal colon only. This would indicate the number of patients with adenomas who would be missed by flexible sigmoidoscopy screening in an Australian population. Methods The study was a retrospective review of patient medical records. Data collection was approved by the Victorian Southern Health Care Network Ethics Committee. Subjects We examined the records of all asymptomatic individuals who underwent full colonoscopy between 1 January 1995 and 31 December 1997 after referral from the Bowel Cancer Prevention Program. Individuals with any symptoms that could be referable to colorectal cancer, such as rectal bleeding, anaemia, change in bowel habit or weight loss, were excluded from the study. The Bowel Cancer Prevention Program targets interested employees of major employer groups or members of participating unions and organisations. Each participant receives educational material about colorectal cancer and is asked to return a simple questionnaire. This assists an expert panel to assess and advise on individual risk of developing colorectal cancer, based on Gut Foundation7 and international guidelines.8 Asymptomatic individuals are referred for colonoscopy if: They are aged 40 years or over and have a self-reported family history of at least one first-degree relative with bowel cancer; or They are aged 50 years or over, and a doctor has requested a colonoscopy for bowel cancer screening because of the patient's marked anxiety. Procedures Informed consent was obtained, and a full colonoscopy was performed with visualisation of the caecum. Adenomas were confirmed by histological examination by private pathology services. Locations of adenomas were noted on the procedure report by the endoscopist at the time of colonoscopy. The position of the splenic flexure, as recognised at colonoscopy, was used to classify adenoma locations as: distal to the splenic flexure only; both distal and proximal to the splenic flexure; and proximal to the splenic flexure only. Data recorded The number of individuals with adenomas and the site of each adenoma within the colon and rectum were recorded, as were complications of sedation or the procedure. Results The records of 1131 asymptomatic individuals who underwent full colonoscopy were examined. The 1131 comprised 715 men and 416 women, with mean age 54 years (range, 40-78 years); 907 (80%) had a family history of colorectal cancer. None of the patients died or required hospitalisation for complications of sedation or the procedure. Colorectal polyps were found in 270 people (24%) and were confirmed to be adenomas in 138 (12%). These 138 comprised 106 men and 32 women, with mean age 54 years (range, 40-78 years). Adenomas were found in 118 of the 907 people with a first-degree relative with bowel cancer (13%) and in 20 of the 224 people whose only risk factor was age 50 years or more (9%). This difference in adenoma rates was statistically significant (P < 0.05). Most of the 138 patients (86%) had a single adenoma, while 14% had two or more. The adenomas ranged from 5 mm to 2 cm in diameter. Distribution of adenomas relative to the splenic flexure is shown in the Box. The distribution did not differ significantly between people who had a family history of colorectal cancer and those who did not: in both groups, 25% had adenomas proximal to the splenic flexure only. Discussion Different regimens are proposed for screening programs to prevent colorectal cancer. These include FOBT, periodic flexible sigmoidoscopy, FOBT combined with flexible sigmoidoscopy, or full colonoscopy. The rationale for a screening sigmoidoscopy is that it would detect most adenomas, as they are most common in the left colon. Further, in those with adenomas (or cancer) proximal to the splenic flexure, the theory is that adenomas would also be found in the distal colon by flexible sigmoidoscopy, thus signalling the need for full colonoscopy -- the concept of the "sentinel" polyp [adenoma].8This theory is not supported by the results of our study. We found that in 25% of asymptomatic individuals with adenomas, the adenomas were found only in the proximal colon, beyond the reach of the flexible sigmoidoscope. This figure is consistent with other studies.9 A sentinel adenoma on the left side signalling proximal adenomas was found in only 14% of people; 62% of subjects had only left-sided adenomas. In our study the distribution of adenomas was assessed from the endoscopists' reports. Experienced endoscopists are correct in determining scope-tip position 83% of the time.10 One cannot assume that a 60 cm flexible sigmoidoscope will reach the splenic flexure. Indeed, a recent report suggests that it reaches 60 cm in only 34% of cases, and far less often in women than in men, with the problem worsening with increasing patient age.11 There are no other Australian data on the incidence or distribution of adenomatous polyps in the colon and rectum. Collett et al showed that distal colorectal cancer or adenomas predicted proximal neoplasia in 30% of subjects, but their study was based on colonoscopy only after a positive result from flexible sigmoidoscopy.12 Their study design did not allow them to accurately determine the distribution of adenomas in the colon and rectum. Colonoscopy remains the final diagnostic pathway for any positive result for a bowel cancer screening test. Some international experts recommend use of colonoscopy as the optimum screening tool to prevent the development of colorectal cancer.13 However, it has not been embraced as the primary screening modality because of concerns about cost, compliance and risk. The risks of colonoscopy include those related to sedation, as well as the procedure, such as perforation (reported at 1 in 200014) and bleeding complicating polypectomy. Complication rates are usually derived from hospital populations, which include many ill patients who have significant comorbidity, and it may be that the risk is considerably less in the far healthier "screening" population. No significant sedation- or procedure-related complications or deaths occurred in our comparatively small series of colonoscopies. The proportion of men to women in the group with the adenomas was about 2:1. This probably reflects our target population rather than a true difference in the incidence of adenomas. However, men are significantly more likely to develop colorectal cancer than women.15 Unfortunately, most reported case series of adenomas have studied populations heavily biased with men. Larger studies examining the influence of sex on adenoma frequency and distribution within the colon and rectum are needed. Well-designed overseas studies have confirmed that programs based on annual FOBT followed by colonoscopy for those with positive FOBT results significantly reduce anticipated mortality from colorectal cancer.16,17 Adding flexible sigmoidoscopy to FOBT to detect proximal adenomas seems sensible but adds significantly to cost. Indeed, a recent Australian economic study using computer modelling clearly showed that only FOBT or five- or 10-yearly colonoscopy are cost-effective bowel-cancer screening methods; flexible sigmoidoscopy alone or in combination with FOBT was not cost-effective.18 The distribution of adenomas found in our study adds weight to the recent suggestion that it is time to consider adding full colonoscopy to the menu of options available to general practitioners when discussing bowel cancer screening and prevention with their patients.19 References Coates M, Day P, McCredie M. Cancer in New South Wales: incidence and mortality 1992. Sydney: NSW Cancer Council, 1995. Australian Institute of Health and Welfare and the Australasian Association of Cancer Registries. Cancer in Australia 1991-1994 (with projections to 1999). Canberra: AIHW, 1998. Muto T, Bussey H, Morson B. The evolution of cancer in the colon and rectum. Cancer 1975; 36: 2251-2270. Winawer S. The National Polyp Study. Design, methods, and characteristics of patients with newly diagnosed polyps. The National Polyp Study Workgroup. Cancer 1992; 70: 1236-1245. National Health and Medical Research Council. Clinical practice guidelines. The prevention, early detection and management of colorectal cancer. Canberra: NHMRC, 1999. Australian Health Technology Advisory Committee. Colorectal cancer screening. Canberra: AGPS, 1997. Gut Foundation of Australia. Colorectal cancer prevention, diagnosis and treatment (public information booklet). Sydney: The Foundation, 1999. Winawer S, Fletcher R, Miller L, et al. Colorectal cancer screening: clinical guidelines and rationale. Gastroenterology 1997; 112: 594-642. Kadakia S, Wrobleski C, Kadakia A. Prevalence of proximal colonic polyps in average-risk asymptomatic patients with negative fecal occult blood tests and flexible sigmoidoscopy. Gastrointest Endosc 1996; 44: 112-117. Shah S, Saunders B, Brooker J, Williams C. What happens during routine colonoscopy? An audit using magnetic positional imaging (MPI). Gut 1999; 44 Suppl 1: A105. Jacobs J, Burke C, Larive B. 60 cm flexible sigmoidoscopy, how far do we really get? [abstract] Gastroenterology 1999; 116 (4 Pt 2): A428. Collett J, Platell C, Fletcher D, et al. Distal colonic neoplasms predict proximal neoplasia in average-risk, asymptomatic subjects. J Gastroenterol Hepatol 1999; 14: 67-71. Rex D, Amitabh C, Vasudeva R. Prospective determination of distal colon findings in average-risk patients with proximal colon cancer. Gastrointest Endosc 1999; 49: 727-730. Basson M, Etter L, Panzini L. Rates of colonoscopic perforation in current practice. Gastroenterology 1998; 114: 1115. Rex D, Lehman G, Ulbright T, et al. Colonic neoplasia in asymptomatic persons with negative fecal occult blood tests: influence of age, gender and family history. Am J Gastroenterol 1993; 88: 825-831. Mandel J, Bond J, Church T. Reducing mortality from colorectal cancer by screening for fecal occult blood. N Engl J Med 1993; 328: 1365-1371. Hardcastle J, Chamberlain J, Robinson M, et al. Randomised controlled trial of faecal-occult-blood screening for colorectal cancer. Lancet 1996; 348: 1472-1477. Bolin T, Korman M, Stanton R. Positive cost effectiveness of early diagnosis of colorectal cancer. Colorectal Dis 1999; 1: 113-122. Bolin T, Korman M. How can we reduce the incidence and mortality of colorectal cancer? Med J Aust 1997; 166: 175-176. (Received 5 Nov 1999, accepted 24 Jan 2000) Authors' details Gastroenterology Unit and Department of Medicine, Monash Medical Centre, Melbourne, VIC. Fiona B Nicholson, FRACP, Fellow; Melvyn G Korman, PhD, FRACP, Director; Anthony I Stern, PhD, FRACP, Visiting Physician; Jack Hansky, FRACP, Visiting Physician. Reprints: Dr M G Korman, Department of Gastroenterology, Monash Medical Centre, 246 Clayton Road, Clayton, VIC 3168. m.kormanATshcn.com.au Make a comment Back to text

Fiona B Nicholson · Melvyn G Korman · Anthony I Stern · Jack Hansky

For Debate The new health insurance rebate: an inefficient way of assisting public hospitals Stephen J Duckett and Terri J Jackson MJA 2000; 172: 439-442 For editorial comment, see Palmer Abstract - The size of the public sector in acute hospital care - Assessing the benefit of the private contribution - Alternative uses of the Commonwealth subsidies - Conclusions - References - Authors' details - - More articles on Administration and health services Abstract Private health insurance subsidy is now estimated to cost $2.19 billion; government support for private health care includes a further $1.2 billion of Medicare benefits expenditure in hospitals. The subsidy cannot be justified on efficiency grounds, as, on the basis of available evidence and taking casemix into account, public hospitals are more efficient than private hospitals. The original stated objective of the subsidy was to "take pressure off public hospitals". If the insurance subsidy and the Medicare Benefit Schedule rebate expenditure were applied to purchasing public hospital treatment at full average cost, 58% of current private sector demand could be accommodated. If 10% of the demand were met at marginal cost, this would increase to 65%. The objective of "taking pressure off public hospitals" could be more efficiently achieved by direct funding of public hospitals rather than through subsidies for private health insurance. For the past 30 years the role and viability of the private sector in the Australian healthcare system has been at the forefront of health policy debate,1 with Labor and coalition Liberal-National Party governments taking different tacks on the issues of universal public health insurance and the importance of the private hospital sector. The current Coalition Government (elected in 1996) has stated a commitment to "preserving Medicare fundamentals", but has also actively promoted private alternatives to the public healthcare system. In addition to the existing 75% subsidy for medical services to private inpatients in public hospitals, since January 1999 the government has provided a 30% rebate to consumers on their private health insurance premiums. The policy was initially estimated to cost $1.3 billion, but this was recently revised to $2.19 billion.2 The justification for this initiative was that it would help the private sector, take pressure off public hospitals and restore "much needed balance" to the healthcare system.3 The rebate is effectively a subsidy to the private health insurance industry and is larger than budgetary assistance for the mining, manufacturing and primary agricultural production industries combined.4 There is no intrinsic characteristic of private health care which gives it a greater claim for public subsidy than any other industry, except in so far as it can be shown to be more efficient to subsidise the private sector than expand the public sector (the government's second explicit justification for the new policy). We analyse here the available data to assess whether the latter justification is reasonable. The size of the public sector in acute hospital care Box 1 shows the relative contribution of public and private hospitals to the healthcare system. The larger public sector proportion of beds relative to hospitals indicates that public hospitals, on average, are larger than private hospitals. The larger bed-day proportion relative to separations indicates that public hospitals have slightly longer average length of stay. There may be an efficiency element in this difference, but it is important to note that the average casemix-adjusted cost weight for public hospitals is higher (1.02) than for private hospitals (0.94), indicating the higher average complexity of cases managed in public hospitals.5As Box 2 shows, of the $16 billion spent on hospitals in 1995/96, over 73% came from public sources, with private health insurance contributing about 18%.6 If the health insurance rebate had been paid in 1995/96, the private health insurance contribution to meeting health costs would have declined from 18% to around 13%, with a commensurate increase in the proportion of Commonwealth expenditure. Assessing the benefit of the private contribution Whatever the political motivations for the new policy, the economic justification for subsidising the private sector should demonstrate improvement in one or more of the three traditional economic criteria: technical, allocative and/or dynamic efficiency (Box 3). Technical efficiency It is commonly argued that the private sector is more efficient than the public sector,7 and hence that public subsidies to the private sector promote an efficient allocation of resources. This conventional wisdom has arisen from comparisons of bed-day costs that do not take the differential casemix of the two systems into account. The argument can now be tested using data from the National Cost Weight Study8 for both sectors. The relative weights are derived from a large and representative national sample of public and private hospitals and present robust estimates of the costs by diagnosis-related group (DRG) in each sector. These data reveal apparent differences in costs by DRG between public and private hospitals when adjustment is made for the mix of cases. For example, the estimated average cost for DRG 674 (vaginal delivery without comorbidity and/or complications) is $1795 in public hospitals and $2057 in private hospitals. In contrast, DRG 187 (bronchitis and asthma age < 50 years without comorbidity and/or complications) is less expensive in private hospitals (public hospital cost $1025, private hospital cost $754). The cost for each DRG published in the National Cost Weight Study for each sector can be applied to the relative number of admissions in each DRG5 to derive the casemix-adjusted average cost. To account for casemix differences between the sectors, we standardise using the casemix of the public hospital system. In aggregate, the cost differences appear to favour private hospitals, as shown in Box 4. The Table shows public hospitals' casemix held constant using the average case weight treated in public hospitals while applying the different reported national costs for public and private hospitals. Similar results are also obtained by standardising with private hospital casemix. It can be seen that the average cost per weighted separation in public hospitals, calculated using public hospital costs, is about 11% higher than if the same casemix had been treated using private hospital reported costs. However, the crude figures need to be adjusted for discrepancies in the way costs of care are met in public and private hospitals, reflecting in turn Commonwealth/State divisions in responsibilities for health expenditures. The most notable differences between the two sectors relate to medical, pharmaceutical and depreciation expenses. Medical services (including pathology testing and imaging) in private hospitals are not incorporated in hospital expenditure, and bills are met by patients directly, reimbursed through Medicare and health insurance funds. Pharmaceutical costs are also met by patients, reimbursed through the Pharmaceutical Benefits Scheme. In contrast, in public hospitals, all the costs are met by the State government through its funding of public hospitals. For the dwindling number of private patients in public hospitals, medical costs are reimbursed through Medicare, but pharmacy costs are still borne by the hospital. As a result of these differences in funding arrangements, and hence cost recording, the medical, pathology, imaging and pharmaceutical costs per patient in public hospitals (as reported in cost-weight studies) are substantially higher than those recorded in private hospitals. The reverse is true for depreciation. Typically, capital costs in public hospitals have been funded separately from operating costs and thus depreciation costs have not been well attributed in the public sector. By contrast, stockholders in private hospitals require a full accounting of capital costs, and thus recorded depreciation costs are higher in the private sector than the public sector. The second row of the Table (Box 4) shows the adjusted cost per separation, taking into account the different way these cost elements are financed and reported. Removing the discrepant cost elements reverses the apparent greater technical efficiency of private hospitals over public hospitals. The comparison basis we have adopted of removing the discrepant elements (rather than adding equivalent elements back in) is a conservative approach. It reduces the difference between the cost bases, as private hospitals tend to have a more modern capital stock (increasing depreciation costs relative to public hospitals) and have relatively unconstrained medical and pharmaceutical use (which probably increases their casemix-adjusted costs relative to the public sector). On the other hand, the analysis makes no adjustment for differential tax regimes faced by public hospitals and the for-profit component of the private sector (eg, different payroll tax obligations) which would reduce the difference between the sectors. The net effect of the differential tax regimes is, however, not likely to change the relativities we have reported. The basis for the argument that private hospitals are more "efficient" than public hospitals is further weakened when the "safety net" or residual role of public hospitals is recognised. For example, to the extent that within-DRG variation exists, public hospitals are likely to have the more seriously ill cases because of referral patterns to tertiary teaching hospitals, provision of emergency services, and the like. The fact that private hospitals cost more should not be surprising given the different products of the two sectors, which are not taken into account by casemix standardisation. In particular, private hospitals provide greater amenity (better food, more single rooms), which underpins marketing of private hospitals and private insurance. This probably explains some of the cost differences. In terms of meeting health needs, however, the fact remains that public hospitals are less costly than private hospitals per standardised unit of output, and there does not appear to be a strong argument for public sector subsidy to the private sector based on its greater technical efficiency. Allocative efficiency As is true for most health systems, data to assess the performance of the public and private sectors in terms of allocative efficiency (dollars per health outcome) are more sparse, but there are grounds to suspect that increasing private expenditure is allocatively inefficient: The emerging Australian evidence on variability in medical practice suggests that treatment in the private sector is associated with a higher rate of intervention,9 with no demonstrable impact on outcome or quality. The relatively higher payment rates for private sector fee-for-service medical practice (vs hospital salaried or sessional payments) create problems for recruitment of medical specialists in the public sector and probably inflate public sector medical remuneration. To the extent that the private sector provides consumers with an opportunity to bypass waiting lists and other public sector constraints (and this is another of the marketing claims for private insurance), then it is anomalous that there should be any public sector subsidy at all. To the extent that public sector resource constraints are based on sound clinical judgement or other rational grounds, bypassing those constraints is evidence of unmeasured allocative inefficiency. Dynamic efficiency In terms of dynamic efficiency (the ability of the health sector to respond to change and development), it is clear that in Australia the engine room for development in health continues to be the public sector. This can be shown by the relatively higher contribution of the public sector to the training of the next generation of health professionals (90% of specialists in training are in public hospitals) and by the fact that nearly all clinical research is conducted in large public sector institutions (the public teaching hospitals) rather than private sector institutions. In summary, on available evidence hospital care in the public sector is provided at higher levels of technical, allocative and dynamic efficiency than in the private sector. This finding undermines the efficiency justification for a policy of subsidies to the private sector through a health insurance rebate. Alternative uses of the Commonwealth subsidies The health insurance subsidy was justified as taking pressure off the overburdened public hospital sector. The Commonwealth tax expenditure on the hospital component of the health insurance rebate is $1.5 billion. Medicare benefit payments for private inhospital medical services is currently around $0.9 billion per year, but is likely to increase to around $1.2 billion by 2002/03. Together, these payments provide a direct Commonwealth subsidy for private sector services, principally private hospital services, of $2.7 billion per year when take-up stabilises in 2002/03. Because the justification for a health insurance rebate has been cast in terms of hospital access, withdrawal of the hospital insurance rebate should see withdrawal of the rebate for ancillary insurance (out-of-hospital dental, optometrical and allied health services), representing a further potential saving of $0.7 billion per year. Thus, if the insurance rebate were withdrawn in full, this $3.4 billion per year would be available to pay for expansion of the public sector to meet the same demand. A $3.4 billion injection into the public sector at Victoria's projected 2002/03 full casemix payment rate for teaching hospitals ($2463 per weighted case multiplied by the 0.94 average weight in the private sector) would allow an additional 1.5 million cases to be treated in Australian public hospitals. This is 58% of the estimated 2.5 million separations from private hospitals in 2002/03 (assuming a 6.8% increase per year in private hospital admissions, the rate from 1991/92 to 1997/98). Given the substantial change that has taken place in hospital practice in recent years through the increased proportion of day procedures obviating overnight stays, there is spare physical capacity in public hospitals which could absorb a considerable proportion of such a potential transfer with no requirement for new capital stock. These calculations allow payments to public hospitals at full cost. If it is assumed that some of the patients transferring to the public sector could be treated at marginal cost, then an even higher proportion of the private sector separations could be treated. For example, if the public sector were able to expand its current capacity by 10% at marginal cost, then the $3.4 billion Commonwealth subsidy would enable treatment of 1.6 million additional cases, representing 65% of the projected private hospital activity (using Victorian prices for "margin A" and "variable" payments).10 Even if the federal subsidy for ancillary insurance were retained, over half of private hospital separations could be treated in public hospitals using the funding for the private hospital insurance rebate (Box 5). These estimates may overestimate the activity increase which might be achieved by using the insurance subsidy to purchase additional public hospital separations directly. Firstly, Victorian payments are lower than most other casemix-funding States.11 Secondly, the full costs of the Medicare inhospital rebate have been applied to purchasing additional public hospital activity. This does not provide compensation to States which currently gain revenue for treatment of private patients in public hospitals, nor leave any room for Medicare medical funding for remaining private hospital patients. Further, the estimates are based on an assumption that there is spare capacity in hospitals and that no additional capital is required. On the other hand, it is unlikely that the public hospital system would need to accommodate all private hospital activity in the foreseeable future. Although the proportion of the population covered by private health insurance has been declining since the 1970s (except for a policy-related aberration in the early 1980s and the marginal increase effected by the rebate), there is likely to be a significant minority in the population who retain private insurance, even in the absence of subsidies, and who continue to use private hospitals. Further, not all admissions to private hospitals would meet admission criteria for public hospitals (the most obvious example being cosmetic surgery). These factors would reduce the estimated demand to be transferred to public hospitals. Finally, these estimates have been based on the assumption that private hospital weighted separations will grow by 6.8% per year, which is the upper band of any reasonable assumption about private hospital growth. Conclusions Data used in efficiency comparisons of public and private hospitals have been flawed by the absence of casemix adjustment. These deficiencies in the data have fostered a longstanding but mistaken view that the private sector is more efficient than the public sector in providing hospital care. Even casemix data give this misleading result if costing discrepancies are not taken into account. Our analysis has shown that, when appropriate adjustments are made to these cost estimates, the public sector provides care at a lower cost per case, and thus there is no economic basis for directing additional expenditure to the private sector. If the recently introduced subsidy to the private sector were applied directly to enhancing the capacity of public hospitals to meet additional demand, the greater part of current private sector hospital care could be accommodated within the public sector. Such an approach would not only realise technical efficiency objectives, but also arguably enhance the allocative and dynamic efficiency of the Australian healthcare system. Withdrawal of the subsidy would not mean elimination of choice in hospital care. Treatment would continue to be available in private hospitals, but the full cost of insurance would be borne by those who make this choice. The key economic justification for the rebate -- reducing demand on public hospitals -- is not a sound basis for the policy, as the costs of the rebate could have been applied more efficiently to supporting public hospitals directly. References Altman S, Jackson T. Health care in Australia: lessons from down under. Health Affairs 1991; 10: 129-144. Senate. Community Affairs Legislation Committee. Hansard, Canberra, 7 February 2000: CA77. Second Reading Speech by Minister for Health and Aged Care, Dr Michael Wooldridge MP introducing the Private Health Insurance Incentives Bill 1998. House of Representatives Hansard, 12 November 1998: 263. Duckett SJ. Policy challenges for the Australian health care system. Aust Health Rev 1999; 22: 130-147. Australian Institute of Health and Welfare. Australian hospital statistics 1996/97. Canberra: AIHW, 1998. (AIHW Cat No. HSE 5, Health Services Series No. 11.) Australian Institute of Health and Welfare. Health expenditure bulletin No. 14. Canberra, AIHW, 1998. Bryce, M. APHA shores up fragmenting industry for joint campaign to push private health care. Healthcover 2000; 10(1): 46-51. Commonwealth Department of Health and Family Services. Report on the national hospital cost data collection 1996/97. Canberra: AGPS, 1998. Robertson I, Richardson J, et al. The impact of new technology on the treatment and cost of acute myocardial infarction in Australia (Technical Report 10). Melbourne, Centre for Health Program Evaluation, 1998. Victorian Department of Human Services. Victoria -- public hospitals: policy and funding guidelines, 1998/99. Melbourne, VDHS Acute Health Services, 1997. Duckett SJ. Casemix funding for acute hospital inpatient services in Australia. Med J Aust 1998; 169 Suppl: S17-S21. Authors' details School of Public Health, La Trobe University, Melbourne, VIC. Stephen J Duckett, PhD, FCHSE, Professor of Health Policy. Hospital Services Research Group, Monash University Health Economics Unit, Melbourne, VIC. Terri J Jackson, MA, PhD, Senior Research Fellow/Manager. Reprints: Professor S J Duckett, Faculty of Health Sciences, La Trobe University, Bundoora, VIC 3083. s.duckettATlatrobe.edu.au Make a comment Source: Australian Institute of Health and Welfare.5 Back to text Source: Australian Institute of Health and Welfare.6 Federal, health insurance and out-of-pocket figures have been adjusted to include expenditure on the Medicare rebate for inhospital services, as the source data normally count this separately as medical expenditure. Back to text 3: The concepts of technical, allocative and dynamic efficiency "The production of particular commodities is technically efficient if it uses up the least costly quantity and mix of inputs consistent with the desired outcome. Technical efficiency depends on the relative prices of inputs, as well as on management: labour-intensive production may be wasteful in a high-wage economy, not in a low-wage one. Allocative efficiency refers to the mix of goods and services produced: an economy is allocatively efficient if a reallocation of resources from one type of production to another could not be found which could make anyone better off without making someone else worse off. An economy that produced goods and services that no one wanted, but at the lowest possible cost, would be allocatively very inefficient, though technically efficient. People could be made better off by reallocating resources to other forms of production." Evans RG. Strained mercy: the economics of Canadian health care. Toronto: Butterworths, 1984: 371. "Policy intervention may reduce the rates of innovation and technical improvements in general. The benefits of an efficient use of resources today may thus be outweighed by adverse effects in the long term. Or, as it is sometimes put, static efficiency or short-term efficiency may be inconsistent with dynamic or long-term efficiency, that is a high rate of technical change." Bohm P. Social efficiency: a concise introduction to welfare economics. London: Macmillan, 1987: 75. Back to text 4: Estimated average cost per weighted separation, public hospital casemix, financial year 1996/97 Public hospital costs Private hospital costs Unadjusted average cost per separation $2283 $2058 Average cost per separation adjusted for discrepant elements* $1774 $1941 *Discrepant elements removed are public medical, pathology, imaging, and pharmacy costs and depreciation costs for the private sector. Costings use national public hospital DRG cost weights. Source: Authors' estimates using National Cost Weight Study data.8 Back to text 5: Proportion of estimated 2002/03 private hospital separations which could be funded in the public sector Funded at full Victorian payment rate 10% funded at marginal cost, 90% at full Victorian payment rate Using private hospital insurance rebate expenditure only 47% 53% Using both private hospital and ancillary rebate expenditure 58% 65% Back to text

Stephen J Duckett · Terri J Jackson