The development of relative resource weights for non-admitted patients

Objectives: This study of outpatient costs aims to test two classification systems, a disaggregated occasion of service system (OOS), and a 'bundled' system which attributes related ancillary services to an index clinic visit; and to provide advice to H&CS Victoria on transitional payment policy. Context: Health services delivered by hospital outpatient departments are the subject of increasing research and policy attention, both in Australia and overseas. Payers are particularly concerned with the large share of health services funding, and with the effects of multiple funding sources on provider cost shifting. Victoria's introduction of casemix-based funding for inpatient services in 1993 highlighted the lack of information on outpatient activities, which represent 17.5% of total expenditures in the State. Design: A purposive sample of five hospitals was recruited; two months of activity and related costs data was extracted form each hospital's information system. Results: Costs of 148,234 OOS and 108,486 episodes were analysed. Non-admitted patient services had a mean OOS of $75 and a mean 'bundled' case of $102. Weights for the OOS classification ranged from 0.4 to 2.0; the 'bundled' system ranged from 0.2 and 2.8. High within-category variability (CV>1) was found for over half of both the OOS and 'bundled' categories. Conclusions: Financial data and cost allocations were consistent across hospitals sampled; activity data were less reliable. Differences relating to: outpatient counting rules; definitions for clinical episode and OOS; and patient booking methods varied across hospitals. Intrinsic limitations of the two systems for payment purposes are discussed. Coding rules and audit procedures would support introduction of payment system changes in 1996/97.