Good critique and still time for at least some of these issues to be picked up. Crucial in my view is Luke's comment that 'the main driver of escalating cost is actually on the supply side ... rising expectations ... in the community then serve to amplify an already rising demand'. But there is also the medical profession's rising expectations which are so central to all of this! How do we dampen them?

I am less optimistic about efficiency pricing especially as it may well have deleterious effects on equity. Shall we have a different efficiency price for poor people or Aboriginal people or people from remote areas who may need longer hospital stays than the 'norm'? Might we see cream skimming by the hospitals who will want to avoid admitting 'expensive' patients? Maybe it can all be worked out... but tricky. If this efficient pricing idea were backed by adequate incentives and there is some recognition that an average price regime is maybe OK for starters but needs to be fine tuned to take account of scale issues then could be good but where is the army of analysts to do all this?

Gavin Mooney

At last some analysis is coming to the surface. Here, fortunately, the first poster has added constructively to the thread starter.
Am just here for a look after a visit to Dr Gary Sauer Thompson's blog, "Public Opinion", that seems along the same lines as to integration within the medical system of components dislocated of/from one another and the system as a whole (mental health and its problems and causes, dental, private/ public and so on), also illness prevention and the like, so thanks OLO also, it's not always the easiest topic to understand.

Thanks Gavin. I take your point about potential pitfalls of efficinet pricing but there is a lot of scope for sophisiticated modelling and risk adjustment etc ...as long as the policy direction is clear and, yes, incentives in place (We are working on this in WA Health at the moment).

Also, I think you'll agree that even just having an open discussion about 'fair' pricing must be good thing in terms of teasing out what we value and so on....better than handing hospitals chunks of money annually based on what they spent last year?

LS