Harmony in Healthcare Funding: Equity, Efficiency & Quality

Presenter: Jianli Li, St. Michael's Hospital

Abstract

Rationale:Funding the regions and hospitals with equity, efficiency and quality, is an important facet in approaching harmony in healthcare funding. Historically hospitals have been funded using sector specific models such as global budgets for hospitals and fee for service for physicians. The challenges of a utilization based funding model is that it relies heavily upon historical utilization and is thus biased towards maintaining high levels of utilization regardless of need. The consideration of needs based funding is to also provide resources based on unmet needs.

Objectives: To develop a funding methodology for regions and hospitals with equity, efficiency and quality.

Methodology: In order to reach this equity, resource allocations are made based on the community needs, then hospital capacities. Population needs (expected resources) are projected by epidemiologic tendencies in population and population socio-economic status, age, gender etc. based on collected historical needs (weighted cases). A Generalized Linear Model (GLM) was applied in resources model development as well as an investigation into the use of a multiple-level resources model..

It is also important to estimate the cost per resource intensity weight based on the characters of region and hospital to reach equity in funding and efficiency. Expected cost per weighted case is the base rate for the funding of the regions and hospitals and the cost efficiency index. The ordinary regression/linear model methodologies are unable to fit the models with the data collected from different types of regions and hospitals well. We developed multi-level composite weight robust regression and latent factors methodologies in the modelling process and have obtained better performance of the models.

The multi-level modelling is playing an important role in the assessment of health care expenditure, especially for the countries with large populations.

The models adjust hospital performance for several factors, which consist of community needs, hospital capacities, hospital resource utilization efficiencies and quality performance. To assess the quality performance with equity, the GLM model was applied in standardizing the readmission rate and mortality rate adjusted for several factors. To reflect the community needs and hospital capacity, a Bayesian model was applied in calculating accessibility.

To develop this kind of model, a global and multi-level health care, financial and population information system is essential. To this end, patient, clinical and utilization data, has been modelled at the national level to provide calibrated cost structures and then adapted at the provincial and hospital levels to identify the cost drivers and the indicators of efficiency of health care delivery

Results: These models have been applied in the region and hospital funding implementation and made a significant contribution to the region and hospital strategic planning and decision-making process and improvement of the cost-efficiency and quality.

Conclusions:It is essencial to develop a system of models based on the needs and characteristics of the regins and hospitals in healthcare funding with harmony.