Australia spends around $181 billion on healthcare, or $7400 per person a year, according to the latest Australian Institute of Health and Welfare numbers, and the health sector employs more than one in eight Australian workers.
With such large sums and the health and wellbeing of millions of people involved, careful stewardship of health budgets is vital.
UTS Management Accounting Professor Prabhu Sivabalan has been working with NSW Health to examine how data science can be used to motivate and support better resource allocation and improve the way the state’s $20 billion healthcare budget is spent.
The aim is not to lower costs in and of itself but to better understand why we’re spending what we’re spending
"The aim is not to lower costs in and of itself but to better understand why we’re spending what we’re spending, to ensure we’re all getting what we really need in order to do what healthcare professionals must – serve the community," says Professor Prabhu Sivabalan.
Even small improvements in costing and resourcing can lead to greater value in the order of hundreds of millions of dollars across a health system like the one in NSW.
“In our research group we’re passionate about looking at the data and making sense of it in ways that people working on the front line of healthcare are not able to do,” Professor Sivabalan explains.
“Data can reveal the relationships in the way societies relate to healthcare services and their impact on the bottom line. For example, does the weather play a role in the way patients present to emergency departments? And does the severity of the emergency admission have implications for the nature of costs and the length of stay of patients in hospitals?”
Data can also help make the case for the value of investing more in certain areas of health, such as preventive care or mental health services so that patient admissions and therefore the costs of running hospitals in the long run might be better managed.
The ongoing partnership between NSW Health and UTS Business School has helped the department better conceptualise how resources are being consumed so that it can understand what more might be accomplished within the available budget.
“Costing managers, management accountants and business managers across NSW Health have started to reflect on and apply healthcare costing more actively, in their interactions with clinicians and other health administrators,” Professor Sivabalan says of the emerging, practical impact. “Our continued research and capability building workshops are therefore playing a role in increasing the awareness of clinicians and other non-accountants of these important resourcing issues.”
The work also has relevance for other health systems across Australia and is attracting interest nationally.
With a number of factors putting pressure on health budgets – health inflation was 3.1 percent in the year to March 31, compared with just 1.3 percent for the overall consumer price index – the need for surgical precision when allocating health funds can only continue.
UTS Experts: Prabhu Sivabalan