Bundled maternity services plan shelved

5 December 2017

A bold plan to find savings in the public hospital system by having governments pay a package deal or bundled price for maternity services has been put on hold.

The Independent Hospital Pricing Authority has also warned that the problems identified with bundled pricing will affect similar changes in future.

The Australian revealed last year that the IHPA, a Rudd-era financing agency, was examining whether the next efficiency drive could be in maternity services.

Maternity services were chosen because service volumes and outcomes are relatively predictable and there is huge potential for savings: in 2014-15, more than 220,000 pregnant women were admitted to public hospitals, costing about $1.5 billion to deliver their babies.

There is a 333 per cent variation across the system in the cost of admitted stays for birth, with the average cost $6465. It was expected bundled pricing could reduce the variation and the growth in the average price. This would have flow-on effects across the system.

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