Victorian Auditor-General's Office

Appendix B. Audit Act 1994 section 16—submissions and comments

Introduction

In accordance with section 16(3) of the Audit Act 1994, a copy of this report, or part of this report, was provided to the Department of Health & Human Services and the 17 surveyed health services.

The submissions and comments provided are not subject to audit nor the evidentiary standards required to reach an audit conclusion. Responsibility for the accuracy, fairness and balance of those comments rests solely with the agency head.

Appendix A. Audit methodology

Hospitals

VAGO contracted a data analytics firm to calculate relative stay index (RSI) values using hospital activity data at the patient level from the Victorian Admitted Episodes Dataset, which the Department of Health & Human Services (DHHS) collects from hospitals. Data from 2011–12 to 2013–14 inclusive was used to increase the volume of episodes and improve the robustness of the RSI: longitudinal analysis was not performed. We examined variation of length of stay (LOS) within and between 21 of the largest hospitals in Victoria:

2 Variation in length of stay

At a glance

Background

Acute patient length of stay (LOS) is a key driver of hospital costs and affects the capacity of the health system, both in terms of bed availability and cost. Hospitals should seek to minimise the time patients spend in hospital, without compromising health outcomes. This approach improves efficiency by making beds available for other patients, reducing the cost per patient and enabling care for more patients.

1 Background

1.1 Introduction

Hospital expenditure is the largest single contributor to the growth in national and state public spending. In Victoria, funding for hospital services and assets was just over $10.5 billion in 2013–14. This makes up around three-quarters—73 per cent—of the Department of Health & Human Services (DHHS) budget and 20 per cent of the $50.3 billion State Budget. An ageing and increasing population and increasing rates of chronic diseases are contributing to growing demand for hospital beds and are intensifying pressure on the health budget.

Hospital Performance: Length of Stay

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This audit examined the relative efficiency of length of stay in the largest Victorian public hospitals. The audit assessed whether public hospitals manage length of stay efficiently and whether the Department of Health & Human Services, as the health system manager, actively supports hospital management to achieve efficient length of stay.

Appendix C. Audit Act 1994 section 16—submissions and comments

Introduction

In accordance with section 16(3) of the Audit Act 1994, a copy of this report, or part of this report, was provided to the Department of Premier & Cabinet, the Department of Treasury & Finance, the Department of Health & Human Services, the Department of Environment, Land, Water & Planning, the Department of Justice & Regulation, the State Revenue Office and the Public Record Office Victoria.

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