The National Health Service reforms introduced in 1991, creating an ''internal market'' for health care, have led to shorter hospital stays after surgery, increased use of lower cost alternative providers and shorter waiting times for surgery. That is the central finding of Barton Hamilton and Edward Bramley-Harker in an analysis of over 35,000 patients admitted to hospital for hip fracture surgery during the 1990s, published in the latest issue of the Economic Journal. They find that:
- For patients undergoing hip fracture surgery, post-surgery lengths of stay in hospital declined from an average of 21.2 days in 1990 (pre-reform) to 18.6 days in 1992 (postreform) – and by 1995, the average length of stay had fallen to 17.5 days.
- Over the same period, the fraction of patients discharged from hospitals to lower cost facilities, such as rehabilitation centres or nursing homes, increased from 28.3% to 38.8%.
- The average amount of time a patient waited for surgery after hospital admission declinedfrom 3.75 days to 3.3 days.
While the NHS reforms appear to have led to more cost-effective care, there is concern that the quality of care worsened after the reforms. But these researchers find that the probability that a hip fracture patient dies in hospital did not change between 1990 and 1994, indicating that the quality of care remained unchanged after the reforms. Other measures of quality, such as hospital readmission rates, were not available.
Hamilton and Bramley-Harker also investigated whether shorter queues for hip fracture surgery led to an improvement in post-surgical patient outcomes. Their findings indicate that waiting time has virtually no impact on post-surgical outcomes, such as length of stay or in-hospital mortality. This contrasts with previous studies, which have reported that longer waits for hip fracture surgery lead to poorer outcomes. However, hip fracture patients who wait longer for surgery tend to be much frailer at the time of hospital admission. Hence, the poorer outcomes observed for patients with longer surgery wait times reflects the fact that they were frailer to begin with, rather than the direct impact of delay itself.
Hamilton and Bramley-Harker''s findings are consistent with the incentives provided to hospitals under the NHS reforms. These reforms created an internal market for health care, in which purchasers (district health authorities and GP fundholders) contracted with providers (hospitals) for health services. The intention was that the process of contracting would give hospitals strong incentives to improve efficiency – reduce costs and improve quality – encouraging purchasers to buy their services.
One way of achieving efficiency is to discharge patients promptly and to use lower cost providers such as rehabilitation centres and nursing homes. In the case of hip fracture patients, the NHS reforms have induced hospitals to operate more efficiently by providing incentives to reduce the length of stay and discharge patients to other facilities that can provide care at a lower cost.
''The Impact of the NHS Reforms on Queues and Surgical Outcomes in England: Evidence on Hip Fracture Patients'' by Barton Hamilton and Edward Bramley-Harker is published in the July 1999 issue of the Economic Journal. Hamilton is at the Olin School of Business in Washington University in St Louis; Bramley-Harker is at National Economic Research Associates in London and previously worked for the UK Department of Health.
