Hospital Financing in Seven Countries (Part 10 of 11)

ospitals are a basic element of America's health care system. U.S. hospitals adopt much of the state-of-the-art medical technology, train most new physicians, and are often the point of access to health care for the uninsured. In 1991, hospitals were the single largest category of health spending at 38 percent of national health expenditures (NHE), although other services have increasingly accounted for a greater share of health outlays (8). Hospital expenditures for acute care— the focus of this chapter—equaled 33 percent of NHE in 1991 (table 8-1). Payments for hospital-based acute care rose by about one and one-half times between 1981 and 1991, growing consistently faster than general inflation and contributing substantially to the overall increase in NHE during that period (8,15) (table 8-1). These trends and the substantial amount of money devoted to acute care in the United States have focused cost containment efforts on hospital expenses and payments. Because of the greater focus on hospital costs in recent years and especially on inpatient services, acute inpatient hospital expenditures have increased much more slowly than spending on hospital outpatient care (8) (table 8-1). This trend has two main causes. Changes in payment methods for inpatient services and increased monitoring of inpatient care by public and private payers have motivated hospitals to reduce costs through more careful screening of admissions, reductions in lengths of stay, and closures of empty hospital beds. The other important cause for the decline in acute care inpatient expenditures as a share of total hospital outlays has been the displacement of inpatient care to outpatient sites (15). The organization of the hospital system in the United States is unique and complicated. No other country has such a heteroge-| 135