Demand and Supply of Hospital Services: International Trends

40 Pages Posted: 16 Feb 2009

Date Written: September 22, 2008


This paper describes the main international trends in the demand for and supply and cost of hospital services in the last decades. In almost all countries, including Italy, there has been a substantial reduction in the total length of hospitalizations, a steady rise in the use of day-hospitals and a widespread reduction in the number and capacity of hospitals. These trends have been reinforced by reforms in payment systems and in particular by the use of case payments for reimbursing hospitals. By international standards, the Italian hospital system is characterized by relatively high fragmentation, a situation partly related to the weakness of nursing and residential care facilities in Italy, with an unbalanced "division of labour" between in-patient and out-patient care. This has consequences both for the unit costs of hospitalization and for the hospital component's share of total health expenditure (in Italy above the OECD average). The higher cost of hospital services is also a reflection of the composition of hospital staff, which is strongly biased towards the medical component, especially in small hospitals.

Keywords: hospital services, health expenditure

JEL Classification: H44, I10

Suggested Citation

Iuzzolino, Giovanni, Demand and Supply of Hospital Services: International Trends (September 22, 2008). Bank of Italy Occasional Paper No. 27, Available at SSRN: or

Giovanni Iuzzolino (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
00184 Roma

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