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Sun Tzu is mostly right (The Art of Wha?) However, need to be careful with the assumption that community care is cheaper - there isn't any really significant and broadly reliable data, although clinical outcomes certainly appear to be evidence based. In addition, there is that difficulty around fixed costs and assets - might be worth thinking about how the NHS can sweat them, especially given the coming financial storm.
To paraphrase the venerable man "keep your Community Services close, but your hospitals closer still."