CurrentHospitalFundinginCanada.pdfVIP

www.healthcarefunding.ca P O L I C Y B R I E F Current Hospital Funding in Canada The limitations of Global Budgets February 2014 Global Budgets ? They are an effective tool for controlling growth in hospital costs. The most common mechanism for funding healthcare in Canada is through global budgets. Under global Disadvantages of Global Budgets budgets, a fixed amount of funding is distributed to a There are also some disadvantages to global budgets, healthcare provider, such as a hospital or long-term such as (6)(7): care home, and that provider then delivers services under its mandate to patients for a fixed period of ? To stay within budget, a hospital may restrict time (usually one year) (1)(2). services to patients or be more selective in terms of the patients to whom it provides services (a Few developed countries other than Canada currently process known as cream skimming). use global budgets for healthcare funding; many ? A failure to provide financial incentives to countries that had previously used global budgets shorten lengths of stays (i.e. moving less acute have since transitioned to other funding mechanisms. patients to lower cost care settings). The specific funding amounts provided to healthcare ? Hospitals that do shorten length of stays are providers under global budgets are based on a penalized because they exchange relatively lower number of factors, including historical budgets, rates