New Australian research has found that patients want more choice in the public hospital care available to them, and overseas experience suggests this could improve health outcomes.

Expenditure on health equates to about 10% of GDP, so it is vital for the health of the community that we keep looking for ways to deliver quality outcomes more productively.

Australia is increasingly interested in how competition could be used to improve choice and productivity. After the Australian Government formally reviewed Competition Policy in 2015 it asked the Productivity Commission to further investigate areas within health and human services that could benefit from greater competition.

State and territory governments are on a similar path. To improve public service quality and efficiency they are pursuing greater competition via commissioning and contestability for public service provision. Against this backdrop, Commonwealth Bank worked with Macquarie University’s Centre for the Health Economy to better understand healthcare choice for public hospital patients.

We funded a study that assessed whether or not Australians want more choice over their public hospital care for elective surgery and to what extent they value hospital quality versus convenience.

Methodology

Toluca Australia selected a representative sample of 1,000 Australians. It collected information on attitudes towards the health care system, interest in receiving greater choice over public hospitals and potential difficulties in choosing between hospitals.

The study incorporated a discrete choice experiment that measured the strength of preferences over attributes related to convenience (waiting times and distance from home to hospital) and hospital quality represented by hospital performance metrics on readmission and adverse event rates, potential health gains, GP opinion and the experience of other patients.

Key Findings

• $55 billion was spent on public hospital services in 2014-15,  the largest recurrent budget item for all the states and territories
• At least 260 waiting days were experienced by 10% of Australians needing elective surgery in public hospitals in 2015-16
• More than 700,000 Australians underwent surgery in 259 public hospitals in 2015-16
• Public patients have limited choice between public hospitals when receiving elective care

Study results 

• Respondents value hospital quality the most
• Australians want more choice over their public hospital care when undergoing elective surgery
• When choosing their hospital, 89% of respondents would value help from a GP in their decision making
• Respondents are willing to travel further and wait longer for a better hospital
• The more urgent the surgery, the more valued are shorter distances to hospital and shorter waiting times
• Respondents living outside major cities are more willing to travel long distances to attend a better quality public hospital
• Respondents value equally a GP's opinion on hospital quality and "other patient" experiences
• Respondents are risk averse and will trade off potential health gains to avoid a potential adverse event

Policy implications

• Improve information about hospital quality and make it more accessible to patients
• Reduce the costs of patients exercising their choice
• Give patients assistance from health care professionals when making choices
• Help hospitals respond to patient preferences for quality