Is a hospital a useful unit of spending?

By Jordan Dunbar
BBC News

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Politicians and commentators appear to have settled on a new unit of measuring public spending - the hospital. So how much does a hospital actually cost?

You might have noticed a new unit of measurement for expenditure.

The Vote Leave campaign, for instance, declared during the referendum on European Union membership: "The EU costs us £350 million a week. That's enough to build a new NHS hospital every week of the year."

MEP Daniel Hannan tweeted: "According to the European Court of Auditors, €7 billion of the 2013 budget was misspent. Enough to build 10 state-of-the-art NHS hospitals."

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image captionThe controversial Vote Leave campaign bus

Meanwhile, the Huffington Post reported: "Jeremy Corbyn Wants To Abolish The UK's Trident Nuclear Deterrent. This Is What The £100 Billion Could Buy At The Same Time… 56 Hospitals."

But there's a problem. None of them agree how much a hospital actually costs to build.

The Leave campaign put the cost of a new hospital at £350m, while Hannan put it at £600m (700 million euros). For its part, the Huffington Post writes: "Each new facility is estimated to cost £178 million" (though a 56th of £100bn is actually £1.78bn).

So what is the actual price tag?

Find out more

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It's very difficult to give a definitive cost for building a hospital, says Prof John Appleby, a health economist at Nuffield Trust, because it fluctuates so wildly.

"The reason it varies massively is that hospitals come in all shapes and sizes. Some of these capital costs will be for bits of hospitals, some will be for relocating hospitals on green-field sites like the Norfolk and Norwich hospital.

"Others are new builds on old sites so they vary in their function and they vary in their size."

At the lower end of the scale, there's a hospital project in Cornwall that cost just £7m - that was a mental health unit - but by contrast the reconstruction of Bart's hospital in London cost £1.1bn - over 150 times more expensive.

And of course, lots of NHS care isn't delivered in hospitals - it is in GP surgeries and out in the community.

"It's actually completely the wrong measurement because it somehow implies we should be having lots more hospitals when maybe that's not the way medicine is going over time," says Appleby.

"If you look at hospital beds the numbers have been decreasing slowly.

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"The reason for that is medicine has moved on and people don't need to stay in hospital so long. We just don't need as many beds.

"It's not that we need more hospitals - we may need shinier, newer hospitals to replace older ones."

Many hospitals are ramshackle buildings ranging from portable cabins to Victorian workhouses spread across huge sites. Often the priority is to turn these into more efficient, greener buildings with a smaller carbon footprint rather than building new hospitals.

So it seems that using hospitals as a unit of measurement is not a great idea.

What could politicians use instead? The cost of operations would be one possibility, says Appleby. For example, a hip operation costs about £5,000 to £6,000.

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image captionAn MRI scanner at Sheffield Children's Hospital - a more consistent unit of spending?

Or they could try MRI scanners. These come in at £895,000, and that price is pretty standard across the NHS.

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