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General Practice

Hospital at home or acute hospital care? A cost minimisation analysis

BMJ 1998; 316 doi: (Published 13 June 1998) Cite this as: BMJ 1998;316:1802
  1. Joanna Coast (jo.coast{at}, lecturer in health economicsa,
  2. Suzanne H Richards, research associatea,
  3. Tim J Peters, reader in medical statisticsa,
  4. David J Gunnell, senior lecturer in epidemiology and public health medicinea,
  5. Mary-Anne Darlow, hospital at home team co-ordinatorb,
  6. John Pounsford, consultant physician, care of the elderlyc
  1. aDepartment of Social Medicine, University of Bristol, Bristol BS8 2PR
  2. bHospital-at-Home, Downend Clinic, Bristol BS16 5TW
  3. cDay Hospital, Frenchay Hospital, Bristol BS16 1LE
  1. Correspondence to: Joanna Coast
  • Accepted 19 February 1998


Objective: To compare, from the viewpoints of the NHS and social services and of patients, the costs associated with early discharge to a hospital at home scheme and those associated with continued care in an acute hospital.

Design: Cost minimisation analysis.

Setting: Acute hospital wards and the community in the north of Bristol (population about 224 000).

Subjects: 241 hospitalised but medically stable elderly patients who fulfilled the criteria for early discharge to a hospital at home scheme and who consented to participate.

Main outcome measures: Costs to the NHS, social services, and patients over the 3 months after randomisation.

Results:The mean cost for hospital at home patients over the 3 months was £2516, whereas that for hospital patients was £3292. Under all the assumptions used in the sensitivity analysis, the cost of hospital at home care was less than that of hospital care. Only when hospital costs were assumed to be less than 50% of those used in the initial analysis was the difference equivocal.

Conclusions: The hospital at home scheme is less costly than care in the acute hospital. These results may be generalisable to schemes of similar size and scope, operating in a similar context of rising acute admissions.

Key messages

  • Some economic evaluations have found that hospital at home care is more costly than acute hospital care in the United Kingdom, and others have found that it is less costly

  • Cost minimisation analysis found a mean cost to the NHS and social services of £2516 per hospital at home patient and £3292 per hospital patient

  • For every £10 000 spent, routine hospital care could be provided for three patients, while early discharge to care in the hospital at home scheme could be provided for four patients

  • Sensitivity analysis (making differing assumptions for the cost of both services within reasonable boundaries) does not change the result that hospital at home is less costly than hospital care; only when hospital costs are assumed to be less than 50% of the original estimate does the difference become equivocal

  • Costs to patients were similar in the two arms of the trial

Editorial by IliffeGeneral practice pp 1786, 1791, 1796


Hospital at home is a generic term referring to home based nursing and rehabilitation services aiming to prevent admission or to facilitate early discharge from care in an acute hospital. Hospital at home schemes are often thought to be a cost effective alternative to acute hospital care,1 2 3 but few published evaluations exist. Some studies have shown that early discharge schemes are viable in terms of cost, 4 5 6 but a recent study has shown increased costs.7 To date, however, no economic evaluations have been published in which cost data have been collected alongside a randomised controlled trial evaluating the effectiveness of hospital at home. Studies have generally concentrated on costs of secondary health care, ignoring costs incurred by the patient, social services, and even primary care. Furthermore, studies have not, generally, followed patients for an equivalent time from the baseline assessment (instead, following patients until discharge) and have not considered whether differences in costs arise after discharge.

We compared standard continued acute hospital care with early discharge to hospital at home, for elderly patients currently in the acute hospital but requiring only nursing or rehabilitative care, or both. The comparison is particularly apt in the current context of rising emergency admissions to hospital, as a perceived aim of hospital at home is to ensure that hospital resources are focused on patients who cannot easily be managed in the community.

The study was carried out in parallel with a pragmatic randomised controlled trial comparing the effectiveness and acceptability of the two alternatives, which concluded that the two forms of care had similar outcomes in terms of mortality, functional outcome, quality of life, and satisfaction with care.8


The economic evaluation compared continued care in an acute hospital with early discharge to hospital at home for patients who had been admitted to the specialties of general medicine, care of the elderly, general surgery, and orthopaedics and who had potential for a good rehabilitative outcome. Patients randomised to the hospital arm received routine hospital care with discharge at the usual time. To ensure that the team operated as close to its capacity as possible, for every patient randomised to hospital care, two patients were randomised to hospital at home. Patients randomised to hospital at home received early discharge with home based rehabilitative care between 8 30 am and 11 pm provided by a team of two nurses (one G grade, one E grade), a physiotherapist (senior 1, 0.8 whole time equivalent), an occupational therapist (senior 1, 0.5 whole time equivalent), and three support workers (B grade auxilliary, flexible hours). Discharge from both hospital and hospital at home occurred when the patient could be managed by routine community services.

The economic evaluation was conducted from two main viewpoints: a combined NHS and social services viewpoint, and a patient viewpoint. The NHS and social services viewpoint is presented separately, except in the analysis of aids and adaptations (which are combined because patients could not reliably distinguish the providing service).

The appropriate form of economic evaluation was determined by the results of the associated trial.9 Although provision was made in the study for conducting alternative forms of evaluation, the appropriate form is a cost minimisation analysis, given the extremely similar results in terms of effectiveness and acceptability.8

The analysis was conducted in the context of rising emergency admissions in a hospital nearing capacity. Average costs were used to value hospital care, as these approximate the costs that would be associated with the provision of new hospital services in the long term. In this context, using short run variable costs to approximate marginal savings in hospital use of resources (which could potentially be recouped to pay for hospital at home) is not appropriate. Using long run costs may also be more meaningful for informing national policy.10

Collection of resource use data

Data on use of resources were obtained for each patient for the three months following randomisation (table 1).

Table 1.

Sources of data on use of resources that was used in analysis

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The acute hospital trust provided information on use of hospital resources on a per patient basis, relating to length of stay, specialty, ward, and use of particular services (for example, some paramedical services, diagnostic tests, use of operating theatre). For the elective surgery centre such information was not available, and resource use was based on length of stay.

Data routinely collected through the integrated community system for particular community services (including the hospital at home team) included number of visits, grade of visitor, and length of visit.

Patients completed questionnaires at 4 weeks and 3 months. Data are missing for patients for whom consent was provided by a carer, withdrawals, and deaths. General practitioners of all patients (excluding those withdrawing from the study) were sent a questionnaire covering the number of home and surgery visits for each patient.

Hospital at home records were used to determine the mileage costs incurred by members of the hospital at home team.

Valuation of resource use data

Sources of valuations for individual items of resource use are shown in Table 2.

Table 2.

Sources of valuations used in analysis

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Costs available on a per patient basis from the acute hospital included use of some paramedical services and use of the operating theatre as well as information about “specialty overheads” (including medical staff, administration, cleaning, catering, maintenance, staff, and capital charges) and “ward/nursing” (including nursing staff dedicated to the ward, ward clerks, consumables attributable to the ward). For the elective surgery centre, valuation was on the basis of postoperative length of stay.

Unit costs of health and social care for 199611 were used to value the majority of community services. Where possible, valuation was conducted using information on the time taken during the visit, and a cost per hour of client contact was used; otherwise, valuation was based on the average cost per visit. Capital and revenue overheads are included.

Costs for the hospital at home team, per hour of client contact, were directly calculated using information about salary (including employer's contribution to national insurance and superannuation) for each grade of staff and about revenue overheads and capital overheads (based on data obtained from Netten and Dennett11). Data from one month were used to allocate the cost of non-contact time across patient contacts. The month chosen was one year after the scheme started.

Market prices (including value added tax) were used to value all items purchased either by the NHS and social services or by patients (where not available from standard sources,11 local information was obtained from community stores or the hospital at home occupational therapist). The initial analysis used a relatively extreme lifespan assumption that items were used for one year and then discarded. An assumption at the other extreme was used for the sensitivity analysis (see below).

The NHS mileage rate at the time of the study was used to value all travel for the hospital at home team. Patients were asked to provide information about the cost of any purchases, services, or contributions to social services.

Sensitivity analysis

Hospital resources released for care of other patients may be less than the long run average cost when patients are nearing the end of their hospital stay and therefore require less intensive nursing support. Sensitivity analyses assumed that resources released would be either 75% or 50% of the average cost.

For the sensitivity analysis, aids and adaptations were assumed to have a 10 year product life, discounted at 6% per year.

It was not possible to obtain information about travel costs for community or social services staff (apart from hospital at home staff), and this cost was ignored. The sensitivity analysis included assumed travel costs.11

Initial estimates of cost per hour of client contact for members of the hospital at home team assumed that the team was fully utilised. However, despite the 2:1 randomisation ratio, the trial itself almost certainly resulted in low recruitment to the scheme. For the sensitivity analysis, revised values were calculated, assuming all patients recruited to the trial would have received hospital at home care (with average treatment time assumed to be identical to that for existing patients) without additional resources being required. This implies that, in treating an extra 50% of patients in the existing scheme, the time available for administration and other activities would be reduced, thus reducing cost per hour of client contact. It was assumed that there would be no impact on the quality of care provided through the scheme.

Statistical analysis

The sample size was not determined for the economic evaluation specifically,8 and the aim was to collect data for all patients included in the study. A variety of data sources was used to acquire information about resource use, and relatively few patients had a complete set of such data. Hence, mean costs for each item of resource use were calculated and then aggregated to estimate the total cost per patient. Statistical testing was therefore not possible at the level of total resource use per patient. The mean is presented for descriptive purposes; although the resource use data are highly positively skewed, provision of information about median resource use and costs (which were often zero) is unhelpful for service planners who require estimates of total costs associated with each scheme. For such skewed data, however, care must be exercised in interpreting standard deviations in particular.

Table 3.

Time spent by members of hospital at home team on client contact and other activities, and cost per hour of client contact (£ at 1995-6 values) used in the main analysis and in the sensitivity analysis

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Table 4.

Resource use per patient for 3 months after randomisation

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All 241 patients participating in the associated randomised controlled trial were included in this economic evaluation.8 table 3 shows the time spent on different activities by the hospital at home team during one month, the associated cost per hour of client contact, and costs used in the sensitivity analysis.

Table 5.

Mean cost (£ at 1995-6 values) per patient for each aspect of resource use in 3 months after randomisation

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The main measures of use of physical resources associated with both forms of care are presented in table 4. table 5 shows the results of combining resource use with information on valuation, in terms of mean cost per patient, and also the total costs associated with particular viewpoints. Hospital at home costs were lower than costs of continued hospital care from both the NHS and social services viewpoint and the patient's viewpoint.

table 6 shows the results of the sensitivity analysis. Neither altering the valuation of aids and adaptations nor including travel costs for community and social service staff made large differences to the results. The impact of assuming a greater utilisation of the hospital at home team (and hence a lower cost per hour of client contact) was inevitably concentrated in the hospital at home arm: relative to the initial results, the impact of this change was to make hospital at home seem even less costly. The greatest impact on results occurred when changes to hospital costs were assumed. When hospital costs were taken as 75% of the original costs, hospital at home continues to be less costly, but if hospital costs were taken as 50% of original costs, the two options incurred similar total costs.

Table 6.

Results of sensitivity analysis. Values are new values (change from initial analysis)

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This economic evaluation comparing early discharge to hospital at home with continued care in an acute hospital followed by routine discharge has, under all assumptions used, found that the cost of hospital at home care is less than that of hospital care over the 3 months from randomisation. Only when hospital costs were assumed to be less than 50% of the costs originally used was the comparison more equivocal.

Costs of the schemes and impacts on budgets

The initial analysis calculated the mean cost per hospital patient as £3292 and that for hospital at home patients as £2516. This implies a reduction in cost of around £750 per patient with early discharge. For every £10 000 spent, routine hospital care could be provided for only three patients, whereas early discharge to care in the hospital at home scheme could be provided for four patients.

The conclusion that hospital at home care seems to be less costly than hospital care is strengthened by the underutilisation of the team during this evaluation owing to the randomisation of patients. This occurred in part because of difficulty in recruiting patients to the trial and in part because one in three consenting patients actually received hospital care. The hospital at home team also spent time publicising the scheme and the associated trial. The hospital at home recruitment rate increased after the trial (from 16 to 35 per month), which would be expected to reduce the cost per hour of client contact. At some point, however, the scheme would become fully utilised and any subsequent increase in caseload could compromise the quality of care.

Hospital at home schemes involve changing the location of the patient's care from the secondary to the primary sector. The impact on the budgets of these sectors could be important: costs for general practitioners increased slightly with hospital at home, but costs for community healthcare services were almost identical for both types of care. The impact on the budget of the secondary care providers will depend on whether new funding is available for hospital at home care.

Costs to patients were much lower than costs to the NHS and social services. For elderly patients, most of whom will be receiving state pensions, these costs may still be important, but they were similar in the two arms of the trial. A slightly higher mean cost for hospital care was due primarily to increased contributions to care by social services.

Limitations of the study

Inevitably this study has limitations. Different data sources were used to estimate quantities of particular items of resource use. For each source, data were available for different numbers of patients (and different patients). To maximise data available for each item of resource use, each item was analysed separately, with aggregation of the mean cost per patient for individual items to estimate total mean cost per patient only at the end of the analysis. This rules out confidence intervals for overall estimates of resource use and statistical analysis of these overall estimates. Basing costs on patients for whom complete data sets were available would have reduced the sample size. As the study was randomised, there is no reason to believe that problems with data availability were more important in one arm of the trial.

Because of the varied nature of patients enrolled into the trial, a time and motion study could not be used to estimate the extent of resource use in the hospital. The sensitivity analysis was used to assess the impact of using average costs, which may not reflect the opportunity costs of hospital care.

Start-up costs and cost of informal care

The hospital at home scheme examined in this trial had been operating for three months before the trial began. The steepest part of the team's learning curve was therefore avoided, but costs associated with hospital at home would be expected to reduce further over time. Particularly in the first year of the study, the hospital at home coordinator spent considerable time publicising the scheme and recruiting patients. The cost per patient associated with the early days of a scheme is likely to be much higher than that associated with an established scheme.

Though 55% of patients studied identified an individual providing informal care, we did not assess costs associated with this informal care. Such assessment is complex12 and outside the resouces available for this study.

Generalisability of findings

The inconsistency in the findings of recent economic evaluations comparing hospital at home schemes with acute hospital care in the United Kingdom 7 13 may result from differences in the type, size, scope, and organisation of schemes; the context in which the service is operating (including differences in costs of the routine care to which hospital at home is being compared); and utilisation of the scheme. Our results are most likely to be generalisable to schemes of similar organisation, size, and scope. The context of rising emergency admissions in which this scheme is operating is also of importance in assessing whether the costs described here are applicable in other situations.


We thank the staff of the Frenchay Healthcare Trust and Avon Orthopaedic Centre at Southmead Hospital for their cooperation with the study, and Maggie Somerset, Margaret Evans, and Sara Brookes for assistance with data collection.

Contributors: JC led the design of the economic evaluation, led in the development of data collection instruments for the economic evaluation, analysed the economic data, led the writing of the paper. SHR contributed to the design of the economic evaluation and assisted in the development of data collection instruments, collected the economic data, and contributed to the writing of the paper. TJP contributed to the design of the economic evaluation and data analysis and to writing the paper. DJG participated in the design of the economic evaluation and data analysis and contributed to writing the paper. JP and MAD participated in the design of the economic evaluation and conributed to the interpretation of data and writing the paper.

Funding: South and West National Health Service Research and Development Directorate. The hospital at home team was funded by Avon Health Authority. The Department of Social Medicine at the University of Bristol is part of the MRC Health Services Research Collaboration.

Conflict of interest: MAD was part of the hospital at home team being evaluated.


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