Poor pre-hospital treatment is estimated to cost Australia $300 million annually, a new study shows.

Older Australians with chronic conditions are in hospital because they didn't get the proper medical care.

About a quarter of the admissions could have been prevented, say researchers who estimate the admissions cost $300 million annually.

The study, published in the Australian Medical Journal, used data from the Department of Veterans' Affairs from between July 2007 and June 2012.

Researchers from the University of South Australia and the BUPA Health Foundation assessed the prevalence of "suboptimal medication-related processes of care" before the admissions of 83,430 older patients.

The university's Dr Gillian Caughey told AAP this related to people who had not received the guideline recommended medical care in respect of medication and testing for their condition.

Of those hospitalised for fractures after a fall, 19 per cent of the men and 17 per cent of the women hadn't received a falls-risk medicine, such as a bone strengthener, before their admission, despite having a history of osteoporosis.

"Seventeen per cent of patients hospitalised for chronic heart failure had not been dispensed an angiotensin-converting enzyme inhibitor (ACEI) or an angiotensin receptor blocker (ARB) in the three months before admission," the authors wrote.

"About one in 10 admissions for renal failure occurred in patients with a history of diabetes who had not received a renal function test in the year before admission and were not dispensed an ACEI or ARB."

Dr Caughey said a small proportion may not have been given medicines due to adverse reactions.

Others may have missed out on the appropriate care due to doctors not being familiar with the guideline recommendations.

Or patients may have multiple conditions and prioritisation is given to one over another.

"The results [of this study] could be used to inform and focus the development of interventions and efforts to improve the quality of health care delivery, potentially reducing morbidity and health care costs," the authors said.