AFRICAN JOURNAL OF HEALTH ECONOMICS - Volume 1 Issue 1, December 2012

Pages: 34-46
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ESTIMATING COST RATIOS AND UNIT COSTS OF PUBLIC HOSPITAL CARE IN SOUTH AFRICA REVISITED

Author: John Ele-Ojo Ataguba

Category: Review & Research

Abstract:

Background

Reliable hospital unit cost estimates are limited in developing countries. Usually a simple rule of thumb based on the assumption that the cost of an outpatient visit is equivalent to a fixed proportion of the cost of an inpatient day is used to disaggregate unit costs. The objectives of the paper are to obtain the ratio of cost of an outpatient visit to an inpatient day,and the associated unit costs for different levels of public hospitals in South Africa.

Methods

Four levels of public hospitals were considered. A simplified model was used on data from the South African District Health Information System to compute the ratio of the cost of an outpatient visit to an inpatient day and the associated average financial costs at each hospital level.

Results

An outpatient visit costs about 0.37 (district hospitals) to 0.64 (specialized hospitals) of an inpatient day. Also the average financial cost of a visit (an inpatient day) ranges from R313 (R487) –district hospitals to R810 (R1441) – central or provincial tertiary hospitals.

Conclusions

The ratios of unit cost of outpatient to inpatient utilization used in computing the unit costs vary across public hospital levels in South Africa. The need to continually update these ratios and unit costs is noted.

Keywords: Unit costs; Public hospitals; Patient day equivalent; Outpatient visit; Inpatient day.

DOI URL: http://doi.org/10.35202/AJHE.2012.1104