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Objectives  To compare the cost effectiveness of early postnatal discharge and home midwifery support with a traditional postnatal hospital stay.

Design  Cost minimisation analysis within a pragmatic randomised controlled trial.

Setting  The University Hospital of Geneva and its catchment area.

Population  Four hundred and fifty-nine deliveries of a single infant at term following an uncomplicated pregnancy.

Methods  Prospective economic evaluation alongside a randomised controlled trial in which women were allocated to either early postnatal discharge combined with home midwifery support (n= 228) or a traditional postnatal hospital stay (n= 231).

Main outcome measures  Costs (Swiss francs, 2000 prices) to the health service, social services, patients, carers and society accrued between delivery and 28 days postpartum.

Results  Clinical and psychosocial outcomes were similar in the two trial arms. Early postnatal discharge combined with home midwifery support resulted in a significant reduction in postnatal hospital care costs (bootstrap mean difference 1524 francs, 95% confidence interval [CI] 675 to 2403) and a significant increase in community care costs (bootstrap mean difference 295 francs, 95% CI 245 to 343). There were no significant differences in average hospital readmission, hospital outpatient care, direct non-medical and indirect costs between the two trial groups. Overall, early postnatal discharge combined with home midwifery support resulted in a significant cost saving of 1221 francs per mother–infant dyad (bootstrap mean difference 1209 francs, 95% CI 202 to 2155). This finding remained relatively robust following variations in the values of key economic parameters performed as part of a comprehensive sensitivity analysis.

Conclusions  A policy of early postnatal discharge combined with home midwifery support exhibits weak economic dominance over traditional postnatal care, that is, it significantly reduces costs without compromising the health and wellbeing of the mother and infant.