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Average hospital stay costs nearly $7,000 per patient in Canada

First CIHI report on costs of patient stays shows heart attack, stroke and injuries account for billions a year in hospital costs

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Information on: The Cost of Acute Care Hospital Stays by Medical Condition in Canada: 2004-2005

March 18, 2008—Patient stays in acute care hospitals account for the largest share (47%) of hospital spending in Canada, according to a new report from the Canadian Institute for Health Information (CIHI). The report, which examined 2.4 million recorded hospital stays (outside of Quebec), estimates that on average each patient stay costs almost $7,000, with a wide variation in cost by medical condition. The study focuses on the cost of treating those patients admitted to hospital for at least one night and does not include the cost of emergency care, day surgery, long-term care, hospital clinics or fee-for-service payments to physicians. The Cost of Acute Care Hospital Stays by Medical Condition in Canada, 2004–2005 is the first report of its kind to examine what hospitals spend by patient stay and by medical condition. Today’s report includes only national figures, though costs are expected to vary from province to province.

“Hospitals account for the greatest share of health spending in Canada, so it is important to understand how the money is spent,” says Jean-Marie Berthelot, CIHI Vice-President of Programs. “Better knowledge of the cost of medical conditions is useful for the planning of health services to meet the needs of the population.”

Circulatory diseases account for highest costs, followed by injury
For patients admitted to hospital, diseases of the circulatory system (for example, heart attack, stroke) cost the most to treat in Canadian acute care facilities, representing 19% of inpatient costs in 2004–2005. This is due to a high cost per stay for these patients, an average of $11,260, as well as a high volume of stays.

Injury and other consequences of external causes (such as falls, accidents, poisoning) represent the second largest expense for acute care hospitals, accounting for 10% of total inpatient costs. In 2004–2005, hospital stays for injury cost, on average, an estimated $9,400 each.

“This finding is significant, because many injuries can be prevented with targeted programs,” says Francine Anne Roy, Director of Health Resources Information. “Understanding the specific costs of these hospital stays, often only one element of the care an injured person might eventually require, can help hospital and system planners better prepare for these patients.”

Underlying conditions or complications account for almost 30% of costs
Many people admitted to hospital with a specific diagnosis may also have a variety of other conditions, often complicating the care they receive. The presence of these underlying chronic diseases (or other secondary illnesses) is costly in terms of hospital care. Almost thirty percent (27%) of the money spent on inpatient care in Canadian acute care hospitals was associated with conditions that were either present when the patient was admitted, or that developed during the hospital stay. For example, a patient receiving care in hospital for a heart attack costs an average of $7,697 over the entire hospital stay. If the same patient has an underlying condition or experiences complications, the average cost increases to $11,043. Some examples of underlying conditions include diabetes, chronic obstructive pulmonary disorder and pneumonia.

Other highlights from the report

• Along with circulatory disease and injury from external causes, the five most expensive medical conditions to treat in hospital include diseases of the respiratory system, cancers and diseases of the digestive system. Together, these five conditions accounted for 58% of the cost of inpatient hospital stays.
• Mental or behavioural disorders are among the top 10 most expensive conditions to treat in hospital, representing 6.6% of the cost of acute care hospital stays.
• Though pregnancy and childbirth accounted for the highest volume of stays, they represented only 5% of total inpatient costs.
• When childbirth is excluded, it costs more, on average, to treat male patients ($7,964 per stay) in a hospital than it does to treat female patients ($6,236 per stay).
• At almost $14,000 per stay, the most expensive conditions to treat are those involving congenital malformations or other chromosomal abnormalities present at birth.

The Cost of Acute Care Hospital Stays by Medical Condition in Canada, 2004–2005 is the first report to break down total acute care inpatient costs into cost per stay and number of stays, and to estimate the share of costs that can be allocated to the treatment or presence of complexity. This report uses Canadian administrative data and the CIHI’s Discharge Abstract Database (DAD) to answer key questions related to total hospital costs for acute care inpatients.

The Canadian Institute for Health Information (CIHI) collects and analyzes information on health and health care in Canada and makes it publicly available. Canada’s federal, provincial and territorial governments created CIHI as a not-for-profit, independent organization dedicated to forging a common approach to Canadian health information. CIHI’s goal: to provide timely, accurate and comparable information. CIHI’s data and reports inform health policies, support the effective delivery of health services and raise awareness among Canadians of the factors that contribute to good health.

Figures and tables

• Figure 1. Total Hospital Costs and Share of Total Cost by Department, Canada, 2004–2005 (adapted from Figure 1 in the report)
• Figure 2. Number of Acute Care Inpatient Stays and Estimate of Average Cost per Stay by Clinical Chapter, 2004–2005, All Age Group and Sexes, DAD Reporting Jurisdictions (adapted from Figure 3 in the report)
• Figure 3. Estimated Share of Acute Care Inpatient Costs Due to the Treatment or Presence of Complexities, Selected Medical Conditions, All Age Groups and Sexes, 2004–2005, DAD Reporting Jurisdictions (adapted from Figure 11 in the report)

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Page last updated March 17, 2008