The Daily Mail online reports that over 4,000 babies were born outside of maternity wards last year in the UK due to a shortage of hospital beds.

Latest figures show that over the past two years there were at least:
  • 63 births in ambulances and 608 in transit to hospitals;
  • 117 births in A&E departments, four in minor injury units and two in medical assessment areas;
  • 115 births on other hospital wards and 36 in other unspecified areas including corridors;
  • 399 in parts of maternity units other than labour beds, including postnatal and antenatal wards and reception areas.
  • Additionally, overstretched maternity units shut their doors to any more women in labour on 553 occasions last year.
Babies were born in offices, lifts, toilets and a caravan, according to the Freedom of Information data for 2007 and 2008 from 117 out of 147 trusts which provide maternity services.

When hospitals are paid on a yearly basis rather than by procedure, there is an incentive to provide less care than is optimal — such as not having enough beds.

In the U.S., some insurers and hospitals pay by patient, creating the same incentive to reduce the number of procedures, but they have to compete with other plans and hospitals that pay for every procedure (which has its own problems — unnecessary procedures can run up costs) and vice versa. This competition helps keep both systems in check — pay-per-use systems have to compete based on cost with pay-per-patient, and pay-per-patient needs to keep its quality up to snuff to avoid losing cautious patients to pay-per-use care.

When there is no meaningful competition for patients — for instance, when the government runs insurance or there isn’t a wide variety of plans to choose from, these incentives lead to the problems that we see in the U.S. (costs being driven up by unnecessary procedures under Medicaid, Medicare and other government-backed plans) and in the UK and Canada (bed and doctor shortages and long wait lists).

Choice is the most important aspect of a cost-effective, quality health care system.

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