Canadian Study Says Patients Fare Better in Higher-spending Hospitals

Seriously ill patients treated in higher-spending hospitals in Ontario, Canada had lower death rates, fewer hospital re-admissions, and fewer repeat heart attacks, according to a study published today in the Journal of the American Medical Association.

Researchers at the Institute for Clinical Evaluative Sciences in Toronto, Canada, said these findings provide a counterpoint to a 2003 U.S. study, which found that higher spending for medical care did not translate to better survival rates or improved quality of care.

In this new study, researchers looked at 400,000 Ontario patients admitted for acute conditions including heart attack, congestive heart failure, hip fracture, or colon cancer from 1998 to 2008. Researchers measured patient outcomes after 30 days and then at a 1-year follow up.

The regional Ontario hospitals in the study were divided into three groups based on how much they spent on hospital, emergency department, and physician services. The higher-spending hospitals with expenditures of $45,000 per patient, per year, spent more than double that of the lowest-spending hospitals.

The bigger spending medical facilities offered patients timely access to preoperative and specialist care, along with rapid response teams and access to high-technology services. They tended to be larger, teaching or community hospitals, in urban areas that were associated with regional cancer centers. Patients enjoyed better nurse-to-patient ratios. The attending physicians there were more likely to be specialists or have more experience treating patients with a particular condition. After a patient was discharged, primary care doctors and specialists tended to collaborate on follow up care. All the hospitals in the Ontario study operate under a “global budget,” a Canadian system that creates incentives to control costs and operate efficiently.

The results showed that, after one month, relative to their low-spending counterparts, patients in the higher-spending medical facilities had 23% fewer admissions for colon cancer, 21% few deaths due to heart failure, 12% less re-admissions for hip fractures, and 7% fewer heart attacks.

“This is not a big surprise and it makes total sense,” said Therese Stukel, lead author and scientist at ICES. The study, she said, points to something subtler about how hospitals should operate. “These results suggest that while it is important to know the amount of money that is spent, it is also critical to understand how the money is spent and whether it is spent on effective procedures and services,” she said.

The study’s results are a strong contrast to those found in a 2003 U.S. study published in the Annals of Internal Medicine, “The Implications of Regional Variations in Medicare Spending, Part 1: The Content, Quality, and Accessibility of Care.” The team of researchers from Center for the Evaluative Clinical Sciences at Dartmouth Medical School, which included Stukel, found that neither the quality of care nor access to medical services appeared to be any better for Medicare enrollees in higher-spending hospitals in the U.S.

Taken together, both of the studies suggest that there are limits to the health benefits that can be achieved with more spending, as there are diminishing returns as more medical technology and specialized services are used. Canada’s health care expenditures per capita are about 57% those of the U.S., which has a 3- to 4 times higher per capita supply of specialized technologies, including MRIs and CAT scans, and triple the number of specialists.

“You need to provide all the care a patient needs, but no more,” said Stukel, saying there is a risk with every procedure. “There’s a tipping point when it gets to be too much and it starts to get worse.”

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