Hospital Performance: Length of Stay

Tabled: 10 February 2016


This audit is the second in a series of performance audits examining hospital efficiency and has again clearly identified a number of opportunities for the Department of Health & Human Services (DHHS) and hospital management to collectively improve the way hospitals operate.

Using a relative Stay Index (RSI) model, it has identified widespread variation in acute patient length of stay (LOS) between many of Victoria's largest public hospitals. This indicates inefficiencies—lost opportunities to free up hospital beds, to treat more patients and to reduce significant unnecessary costs. Even after adjusting for patient characteristics and peer-grouping hospitals, potentially almost 145 000 extra bed days could be made available and $125 million per year could be directed to other services.

The reasons for differences in LOS performance, even among similar hospitals, vary and are not always captured by performance data. However, public hospitals can improve LOS performance by implementing better practice around patient management, from admission through to discharge.

The data used in this audit comes from DHHS and yet it is not using it to identify what is significant variation in hospital efficiency. As the health system manager, DHHS should use its data and—in collaboration with hospital management—actively seek to understand, explain and reduce LOS variances.


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