A funding method being looked at by the province is likely to have unintended consequences on B.C.'s health care system, according to a new study led by a Simon Fraser University researcher.

If put into practice, an activity-based funding model could see patients being released from hospital sooner than under the current system.

"With activity-based funding, we can anticipate that patients here would also be discharged sooner from hospital, at an earlier stage in their recovery, before they're ready to go home alone," said chief researcher Karen Palmer.

Activity-based funding, or ABF, is a system where hospitals receive a predetermined lump amount for each episode of health care. Rather than a large lump-sum payment for everything, hospitals get paid based on each patient's particular diagnosis. B.C., Quebec and Ontario have recently been considering the funding method.

The report, published today on the scientific journal website PLOS One and funded by the Canadian Institute of Health Research, found a 24 per cent increase in discharge from hospitals to post-acute services - including convalescent care, long-term care, in-patient rehabilitation facilities and home care - after the new approach was implemented.

"Earlier discharge is not necessarily undesirable, assuming there is sufficient post-acute care capacity in the community," Palmer said. "The problem is that we don't have that capacity in British Columbia, or in any other province in Canada. Our communitybased post-acute care services are generally not well-developed, and funding for them is a mixed bag of public and private dollars."

A shift of care from hospitals to the community could have implications for equitable access to care, she says.

"We have to find a way to publicly fund these services, or the cost of that care could fall on families or individuals. I think that's the main concern that our study reveals for British Columbians and for Canada."

The system is attractive to governments as a cost-cutting measure, and as an incentive for hospitals and surgical facilities to increase productivity. Palmer's study is the first systemic review of worldwide evidence on activity-based funding. Palmer, an SFU adjunct professor in both health sciences and science, is the study's principal investigator and lead author. She and her team of 19 researchers in Canadian, Swiss and Australian universities combed through 65 relevant studies from the U.S., England, Australia, Switzerland and Germany, which have all adopted the model.

The study also found other areas of health care were affected, though findings varied.

In some cases, hospitals were found to "upcode" some patients to a more serious diagnosis. Since activitybased models tend to increase hospital compensation based on the severity of illness, coding patients so they appear as sick as possible maximizes reimbursement.

Dr. Bill Cavers, president of Doctors of BC, said in an email that "the intent of activity-based funding is to support the quality and timeliness of patient focused care and Doctors of BC supports, in principle, its expansion. We also support rigorous data collection and evaluation processes in any and all programs to ensure they remain beneficial to patients and continue to be responsible with public investment."