The unintended and unexpected impact of downsizing - Costly hospitals become more costly

OBJECTIVES. In this project we assessed the impact of 1992 budget cuts ($50 million, or approximately 7% of urban hospitals' budgets) on the relative costliness of Manitoba's hospitals. The cuts targeted the teaching hospital s, those institutions we had found to be particularly costly in a previous Manitoba Centre for Health Policy and Evaluation study. RESULTS. Unexpectedly, we found that because budget cuts were smaller propo rtionately than the number of beds closed, the care at the teaching hospita ls (as well as at several other hospitals) became relatively more, not less , costly. Also quite contrary to public perceptions, once other expenditure s such as new hospital programs and expansions were accounted for, the actu al change in urban hospital expenditures over the years compared was less t han 1%. CONCLUSIONS. The study highlighted the importance of monitoring program out comes.