How Nursing Home Industry Saves Half a Billion Dollars a Year on Staff

Article published 20 September 2018

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The trial of an on-call medical service for 24 nursing homes in Brisbane has prevented more than 600 unnecessary trips to the hospital emergency department and up to 500 unnecessary hospitalisations over a 12-month period.

During this time, care was provided on 960 occasions, which prevented 638 emergency department presentations. Of these, 498 were potentially prevented hospitalisations.

The trial saved the Queensland Government anywhere from $3.5 million to $4.5 million to provide hospital treatment. The trial itself cost $746,000.

This is good news, but the success of the trial also points to a failure elsewhere in the system.

If these 24 nursing homes had had more registered nurses rostered on, wouldn’t a similar result have been achieved?

Were these 24 nursing homes doing a good job, or were they busily shifting the cost of care covered by federal care subsidies onto Queensland state health system?

Extrapolating the savings made in this trial to the residential aged care sector nationally, which comprises just over 3,000 nursing homes, the nursing home industry’s practice of sending residents to the hospital emergency department at the slightest whiff of trouble, cost the state-run hospital systems half a billion dollars a year.

This is a rough calculation, as most extrapolations are, but it does explain why the nursing home sector is so keen on calling ambulances and so reluctant to publicly report on its staffing arrangements in individual nursing homes.

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