Costing Studies and Reviews

Hospital in the home costing and funding review: In January 2012, the NSW Ministry of Health engaged Health Policy Analysis to provide a costing and funding plan for hospital in the home services. A key driver for this work is the national implementation of activity based funding (ABF).  To undertake the project site a document and literature review was undertaken (which examined costing and funding approaches for hospital in the home services across Australia and internationally), available activity and cost data were analysed, visits were undertaken at 10 hospital in the home services, and costing coordinators from all health services were interviewed.  Results of the analysis and draft recommendations were work shopped initially with the NSW Hospital in the Home Program Working Group and then a broader workshop involving around 80 stakeholders.  

This plan was initially to be a costing and funding plan for hospital in the home services.  However, following a situation analysis of these services, it was expanded to also include recommendations on the scope of hospital in the home, on minimum requirements for services to be formally recognised as hospital in the home, and on what would constitute an admission to these services.  The final report included recommendations on these issues, a data collection plan as well as the costing and funding plan. Another document was also prepared targeting LHDs, outlining their roles and responsibilities in relation to scope, data collection and costing of hospital in the home services to enable fair and equitable funding.  The project was completed within 6 weeks from commencement.

Emergency care classification, costing and funding project: The NSW Department of Health engaged Health Policy Analysis to undertake this project in 2011. The objective of the project was to advance the process through which activity for emergency departments (EDs) is classified, counted, costed and funded. The Department specified a number of key requirements for this project, including to: ·       

  • Review the capacity of current patient costing arrangements to support the provision of patient level cost data.  
  • Review the ED peer classification system.
  • Collect and analyse activity and costing data for the financial year 2009-10.
  • Review grouping of episodes to the Urgency, Disposition and Age Groups (UDAGs) classification and to the national proxy classification for emergency care – Urgency Related Groups (URGs).
  • Develop an improved ED costing methodology.
  • Review feeder systems and recommend improvements to system capacity.

The project involved the modelling of cost weights and identified some of the key issues NSW Health should consider through the 2011-12 period as it prepares for implementation of a national approach to ABF from July 2012. 

NSW Dialysis Costing Study 2008: The NSW Health Department engaged Health Policy Analysis in February 2008 to undertake a comprehensive and detailed study of the costs of dialysis by modality, and compile costs per patient per year, identify differences between rural and metropolitan Area Health Services and develop a funding model for home based dialysis modalities.  More details.

ACT Costing Review 2005: Health Policy Analysis was engaged by the ACT Health in August 2005 to review costing process for ACT public hospitals.  The project had two components – the costing process for the public hospitals establishments data collection and the national hospital cost data collection.  The review examined the costing processes undertaken by staff in each hospital to produce the data for these collections, and critically reviewed the appropriateness and sensitivity of results to the approaches adopted.  Problematic areas and opportunities for improvement were identified particularly through improved standardisation and accuracy.  Advantages and disadvantages of migrating to a patient level costing system were assessed.

NSW Costing Review 2006: The NSW Costing Review was commissioned by the NSW Department of Health and undertaken by Health Policy Analysis Pty Ltd.  The principal aim of the review was to update the NSW Program and Products Data Collection (PPDC) Costing Standards.  The review also addressed a range of new developments that have occurred in the NSW Health system in recent years, including the establishment of new Area Health Service structures, proposals for the implementation of a new program structure, and developments in relation to costing applications used by various health services and hospitals, in particular patient costing applications.  Consultations were held with all health services, key issues and options identified and discussed at two workshops.  The final report set an agenda for systematically improving the quality of data underpinning costing processes, the methods and standards applied in costing, migrating to a patient costing application across health services and improving the accessibility and utility of costing data.

Costing Drug and Alcohol Residential Rehabilitation Services 2004: Health Policy Analysis was commissioned by the NSW Centre for Drug and Alcohol to in August 2004 to conduct a costing study of residential rehabilitation services in NSW.  There were approximately thirty services across NSW mostly operating in the non-government sector.  The project entailed the development of a costing methodology, data collection instruments, consultation with the sector’s representative body, management of the data collection and data analysis.  The final report also made recommendations on options for funding residential rehabilitation.

NSW Unaudited Annual Return:  Since 2003, Health Policy Analysis has prepared outputs required at both a state and national level from the Unaudited Annual Return (UAR) Data Collection on behalf of the NSW Department of Health. The process has involved:  

  • undertaking quality checks on receipt of the data from health services and liaising with health services to feed back issues
  • provision of draft Public Hospital Establishments NMDS
  • preparing a report on overall quality of UAR data and reconciliation to the Audited Annual Return
  • provision of AHCA indicators
  • provision of a report on expenditures and revenues for State Government Residential Aged Care Facilities
  • preparation of NSW returns for the AIHW Health Expenditure Data Collection
  • preparation of NSW returns for the AIHW Public Health Expenditure Collection
  • preparation of an overall report on the collection, overall results, outputs and recommendations regarding data quality for the following year
  • provision of relevant computer programs to the NSW Department of Health for internal use.

The project has been re-awarded to Health Policy Analysis over a number of years due to Health Policy Analysis’ in-depth understanding of accounting and costing processes by health care services, the ability to identify anomalies/data quality issues and the improvements that have been fed back and implemented incrementally.

Review of the IPTAAS eligibility criteria and subsidy levels: In 2011 NSW Health engaged Health Policy Analysis to undertake a comprehensive review of the current Isolated Patients Travel and Accommodation Assistance Scheme (IPTAAS) eligibility criteria and subsidy levels, including cost modelling to inform decision-making regarding potential changes. The objective of the project was to identify, report on and provide recommendations on the best option for reform of IPTAAS eligibility criteria and subsidy levels, with a key focus on improving equity of access to IPTAAS. The project required the following steps:

  • Undertake a cost / benefit analysis of the identified options, and cost modelling to inform NSW Health responses to demands for increases to IPTAAS travel and accommodation subsidy levels.
  • Report on the specific costs and benefits of implementing each option, including identification of priority recommendations for implementation within the available budget.
  • Identify any additional / alternative options for cost modelling.