Severity of illness within DRGs: impact on prospective payment

Prediction of Diagnosis-Related Groups for Appendectomy Patients Using C4.5 and Neural Network

Due to the increasing cost of health insurance, for decades, many countries have endeavored to constrain the cost of insurance by utilizing a DRG payment system. In most cases, under the DRG payment system, hospitals cannot exactly know which DRG code inpatients are until they are discharged. This paper focuses on the prediction of what DRG code appendectomy patients will be classified with when they are admitted to hospital. We utilize two models (or classifiers) constructed using the C4.5 algorithm and back-propagation neural network (BPN). We conducted experiments with the data collected from two hospitals. The results show that the accuracies of these two classification models can be up to 97.84% and 98.70%, respectively. According to the predicted DRG code, hospitals can effectively arrange medical resources with certainty, then, in turn, improve the quality of the medical care patients receive.

Trend in healthcare-associated infections due to vancomycin-resistant Enterococcus at a hospital in the era of COVID-19: More than hand hygiene is needed

BACKGROUND

Variable control measures for vancomycin-resistant Enterococcus (VRE) infections were adopted among different hospitals and areas. We investigated the burden and patient characteristics of healthcare-associated VRE infections in 2018-2019 and 2020, when multiple preventive measures for COVID-19 were taken.

METHODS

During the COVID-19 pandemic, mask waring and hand hygiene were enforced in the study hospital. The incidence densities of healthcare-associated infections (HAIs), including overall HAIs, methicillin-resistant Staphylococcus aureus (MRSA) HAIs, VRE HAIs, and VRE healthcare-associated bloodstream infections (HABSIs), consumption of broad-spectrum antibiotics and hygiene products, demographic characteristics and medical conditions of affected patients, were compared before and after the pandemic.

RESULTS

The incidence density of both VRE HAIs and VRE HABSIs did not change statistically significantly, however, the highest in 2020 than that in 2018 and 2019. This was in spite of universal mask waring and increased consumption of 75% alcohol in 2020 and consistent implementation of an antibiotic stewardship program in three observed years. The increased prescriptions of broad-spectrum cephalosporins might partially explain the increase of VRE infection.

CONCLUSION

Increased mask wearing and hand hygiene may not result in the decline in the development of VRE HAIs in the hospital during the COVID-19 pandemic, and continued monitoring of the dynamics of HAIs remains indispensable.

Assessing the performance of a method for case-mix adjustment in the Korean Diagnosis-Related Groups (KDRG) system and its policy implications

Background

To evaluate the performance of the patient clinical complexity level (PCCL) mechanism, which is the patient-level complexity adjustment factor within the Korean Diagnosis-Related Groups (KDRG) patient classification system, in explaining the variation in resource consumption within age adjacent diagnosis-related groups (AADRGs).

Methods

We used the inpatient claims data from a public hospital in Korea from 1 January 2017 to 30 June 2019, with 18 846 claims and 138 AADRGs. The differences in the total average payment between the four PCCL levels for each AADRG was tested using ANOVA and Duncan’s post hoc test. The three patterns of differences with R-squared were as follows: the PCCL reflected the complexity well (valid); the average payment for PCCL 2, 3, and 4 was greater than PCCL 0 (partially valid); the PCCL did not reflect the complexity (not valid).

Results

There were 9 (6.52%), 26 (18.84%), and 103 (74.64%) ADRGs included in the valid, partially valid, and not valid categories, respectively. The average R-squared values were 32.18, 40.81, and 35.41%, respectively, with an average R-squared for all patterns of 36.21%.

Conclusions

Adjustment using the PCCL in the KDRG classification system exhibited low performance in explaining the variation in resource consumption within AADRGs. As the KDRG classification system is used for reimbursement under the new DRG-based prospective payment system (PPS) pilot project, with plans for expansion, there should be an overall review of the validity of the complexity and rationality of using the KDRG classification system.

Supplementary Information

The online version contains supplementary material available at 10.1186/s12961-021-00739-5.

Impact of Inpatient Harms on Hospital Finances and Patient Clinical Outcomes

Supplemental digital content is available in the text.

Objective

The aim of this study was to determine the impact of all-cause inpatient harms on hospital finances and patient clinical outcomes.

Research Design

A retrospective analysis of inpatient harm from 24 hospitals in a large multistate health system was conducted during 2009 to 2012 using the Institute of Healthcare Improvement Global Trigger Tool for Measuring Adverse Events. Inpatient harms were detected and categorized into harm (F–I), temporary harm (E), and no harm.

Results

Of the 21,007 inpatients in this study, 15,610 (74.3%) experienced no harm, 2818 (13.4%) experienced temporary harm, and 2579 (12.3%) experienced harm. A patient with harm was estimated to have higher total cost ($4617 [95% confidence interval (CI), $4364 to 4871]), higher variable cost ($1774 [95% CI, $1648 to $1900]), lower contribution margin (−$1112 [95% CI, −$1378 to −$847]), longer length of stay (2.6 d [95% CI, 2.5 to 2.8]), higher mortality probability (59%; odds ratio, 1.4 [95% CI, 1.0 to 2.0]), and higher 30-day readmission probability (74.4%; odds ratio, 2.9 [95% CI, 2.6 to 3.2]). A patient with temporary harm was estimated to have higher total cost ($2187 [95% CI, $2008 to $2366]), higher variable cost ($800 [95% CI, $709 to $892]), lower contribution margin (−$669 [95% CI, −$891 to −$446]), longer length of stay (1.3 d [95% CI, 1.2 to 1.4]), mortality probability not statistically different, and higher 30-day readmission probability (54.6%; odds ratio, 1.2 [95% CI, 1.1 to 1.4]). Total health system reduction of harm was associated with a decrease of $108 million in total cost, $48 million in variable cost, an increase of contribution margin by $18 million, and savings of 60,000 inpatient care days.

Conclusions

This all-cause harm safety study indicates that inpatient harm has negative financial outcomes for hospitals and negative clinical outcomes for patients.

A method for analyzing inpatient care variability through physicians' orders

OBJECTIVE

Administrators assess care variability through chart review or cost variability to inform care standardization efforts. Chart review is costly and cost variability is imprecise. This study explores the potential of physician orders as an alternative measure of care variability.

MATERIALS & METHODS

The authors constructed an order variability metric from adult Vanderbilt University Hospital patients treated between 2013 and 2016. The study compared how well a cost variability model predicts variability in the length of stay compared to an order variability model. Both models adjusted for covariates such as severity of illness, comorbidities, and hospital transfers.

RESULTS

The order variability model significantly minimized the Akaike information criterion (superior outcome) compared to the cost variability model. This result also held when excluding patients who received intensive care.

CONCLUSION

Order variability can potentially typify care variability better than cost variability. Order variability is a scalable metric, calculable during the course of care.

The Home Health Care Team: What Can We Learn From the Hospice Experience?

This article briefly describes the history of the development of hospice and home health care and compares and contrasts the policies that govern these two health care delivery systems. The article articulates how these policies affect the nature of interprofessional collaboration within each milieu. The author makes suggestions for what home health care can glean from hospice care to improve service delivery.

Australian diagnosis related groups: Drivers of complexity adjustment

BACKGROUND

In undertaking a major revision to the Australian Refined Diagnosis Related Group (ARDRG) classification, we set out to contrast Australia's approach to using data on additional (not principal) diagnoses with major international approaches in splitting base or Adjacent Diagnosis Related Groups (ADRGs).

METHODS

Comparative policy analysis/narrative review of peer-reviewed and grey literature on international approaches to use of additional (secondary) diagnoses in the development of Australian and international DRG systems.

ANALYSIS

European and US approaches to characterise complexity of inpatient care are well-documented, providing useful points of comparison with Australia's. Australia, with good data sources, has continued to refine its national DRG classification using increasingly sophisticated approaches. Hospital funders in Australia and in other systems are often under pressure from provider groups to expand classifications to reflect clinical complexity. DRG development in most healthcare systems reviewed here reflects four critical factors: these socio-political factors, the quality and depth of the coded data available to characterise the mix of cases in a healthcare system, the size of the underlying population, and the intended scope and use of the classification. Australia's relatively small national population has constrained the size of its DRG classifications, and development has been concentrated on inpatient care in public hospitals.

DISCUSSION AND CONCLUSIONS

Development of casemix classifications in health care is driven by both technical and socio-political factors. Use of additional diagnoses to adjust for patient complexity and cost needs to respond to these in each casemix application.

The lessons of Medicare's prospective payment system show that the bundled payment program faces challenges

Policy makers have been trying to replace Medicare's fee-for-service payment system for years with approaches that pay one price for an aggregation of services. The intent is to reward providers for offering needed care in the most appropriate and cost-effective manner. Medicare's first payment change designed to accomplish such a change was the hospital prospective payment system, introduced during 1983-84. But because it focused only on hospital care, its impact on total Medicare spending was limited. In 2011 Medicare began a new initiative to expand the "bundled payment" concept to link payments for multiple services that patients receive during an episode of care. The goal of Medicare's current bundled payment initiative is to provide incentives to deliver health care more efficiently while maintaining or improving quality. This article provides a detailed analysis of how Medicare implemented the hospital prospective payment system, how hospitals responded to the new incentives, and lessons learned that are applicable to the bundled payment initiative. The lessons include that any Medicare payment reform needs to continuously respond to the many different components of the health system and that payment reform should be coupled with analogous reforms in private insurance payment, so that providers receive consistent signals to alter their behavior.

Validation of Resource Utilization Groups version III for Home Care (RUG-III/HC): evidence from a Canadian home care jurisdiction

BACKGROUND

The case-mix system Resource Utilization Groups version III for Home Care (RUG-III/HC) was derived using a modest data sample from Michigan, but to date no comprehensive large scale validation has been done.

OBJECTIVES

This work examines the performance of the RUG-III/HC classification using a large sample from Ontario, Canada.

METHODS

Cost episodes over a 13-week period were aggregated from individual level client billing records and matched to assessment information collected using the Resident Assessment Instrument for Home Care, from which classification rules for RUG-III/HC are drawn. The dependent variable, service cost, was constructed using formal services plus informal care valued at approximately one-half that of a replacement worker.

RESULTS

An analytic dataset of 29,921 episodes showed a skewed distribution with over 56% of cases falling into the lowest hierarchical level, reduced physical functions. Case-mix index values for formal and informal cost showed very close similarities to those found in the Michigan derivation. Explained variance for a function of combined formal and informal cost was 37.3% (20.5% for formal cost alone), with personal support services as well as informal care showing the strongest fit to the RUG-III/HC classification.

CONCLUSIONS

RUG-III/HC validates well compared with the Michigan derivation work. Potential enhancements to the present classification should consider the large numbers of undifferentiated cases in the reduced physical function group, and the low explained variance for professional disciplines.

Factors Associated With Functional Decline of Hospitalised Older Persons Following Discharge From an Acute Geriatric Unit

Introduction: Older persons are likely to develop functional impairment following hospitalisation. Several studies in the West have examined the factors associated with functional decline following the older person’s discharge from hospital but there are little data on Asian populations. This study aims to look at the associated risk factors in our local population, following admission to an acute geriatric unit. Materials and Methods: This is a retrospective, cohort study. Patients who were discharged from an inpatient geriatric unit over a 3-month period were recruited. Data including their demographic information, functional status prior to admission and at the time of discharge, and medical conditions were obtained from the inpatient medical notes. A follow-up telephone interview was conducted at 3 months to determine the functional status of these patients at that point in time. Results: Following hospitalisation, 40.4% of patients developed functional decline. Of those discharged, 29.6% showed functional decline at 3 months. The principal diagnosis, hypoalbuminaemia, tendency to fall, premorbid functional independence and the length of hospitalisation were associated with functional decline during hospitalisation, while hypoalbuminaemia, the presence of bedsores, institutionalisation, the length of hospitalisation and premorbid functional dependence were important factors associ- ated with functional decline between the time of discharge and 3 months after. In the multivari- able predictive model, independent predictors of functional decline at the time of discharge included patient’s tendency to fall, premorbid functional independence and the length of hospitalisation, while the presence of bedsores was the only significant predictor of functional decline 3 months post-discharge. Conclusions: Many elderly patients developed new functional impairment following hospitalisation. Several factors were found to be associated with this functional decline, though no single predictive model similar to the other published studies was identified. Key words: Admission, Functional impairment, Risk factors

Investigating Delay in Social Service Referral as a Predictor of Unattained Social Service Goals in Home Health Care

The present study sought primarily to determine whether attainment of social service goals was affected by the number of days between admission to home care and referral to medical social services. We also sought to determine if patient residence in a rural or urban area, annual income, and the total number of social service goals affected attainment of social service goals. Using a random sample of 306 home care patients throughout Texas, we found that the length of time between admission to home care and social service referral and annual income did not have a significant effect on social service goal attainment. However, elders living in rural areas and those having a moderate number of social service goals had significantly more unattained social service goals. Social service implications are discussed.

Effect of practice variation on resource utilization in infants hospitalized for viral lower respiratory illness

OBJECTIVE

Hospital care for children with viral lower respiratory illness (VLRI) is highly variable, and its relationship to severity and impact on outcome is unclear. Using the Pediatric Comprehensive Severity Index, we analyzed the correlation of institutional practice variation with severity and resource utilization in 10 children's medical centers.

METHODS

Demographics, clinical information, laboratory results, interventions, and outcomes were extracted from the charts of consecutive infants with VLRI from 10 children's medical centers. Pediatric Component of the Comprehensive Severity Index scoring was performed at admission and at maximum during hospitalization. The correlation of patient variables, interventions, and resource utilization at the patient level was compared with their correlation at the aggregate institutional level.

RESULTS

Of 601 patients, 1 died, 6 were discharged to home health care, 4 were discharged to rehabilitative care, and 2 were discharged to chronic nursing care. Individual patient admission severity score correlated positively with patient hospital costs (r = 0.48), but institutional average patient severity was negatively correlated with average institutional costs (r = -0.26). Maximal severity score correlated well with costs (r = 0.66) and length of stay (LOS; r = 0.64) at the patient level but poorly at the institutional level (r = 0.07 costs; r = 0.40 LOS). The institutional intensity of therapy was negatively correlated with admission severity (r = -0.03) but strongly correlated with costs (r = 0.84) and LOS (r = 0.83).

CONCLUSIONS

Institutional differences in care practices for children with VLRI were not explained by differences in patient severity and did not affect the children's recovery but correlated significantly with hospital costs and LOS.

Severity assessment in children hospitalized with bronchiolitis using the pediatric component of the Comprehensive Severity Index

OBJECTIVE

Practice variation in the management of children hospitalized with bronchiolitis may result in significant differences in resource utilization. Determination of cost-effective care requires an objective means of adjusting for severity. We examined the correlation of the pediatric component of the Comprehensive Severity Index (CSI) with resource utilization in children hospitalized with bronchiolitis at ten children's medical centers.

DESIGN

Demographics, clinical findings, laboratory results, interventions, and outcomes were retrospectively extracted from the charts of 804 consecutive children with International Classification of Disease, Ninth Revision codes for bronchiolitis from 10 children's medical centers. Comorbidities of prematurity, heart disease, and a prior history of wheezing or hospitalization, and the viral etiology of the illness were specifically examined. CSI scoring was performed at admission and maximum and correlated with patient variables and measures of resource utilization (hospital costs, length of stay, pediatric intensive care unit admission, and intubation). The performance of CSI relative to the Pediatric Risk of Mortality III was also evaluated.

SETTING

Ten tertiary children's medical centers.

INTERVENTIONS

None.

MEASUREMENTS AND MAIN RESULTS

One child died and >99% of children returned to their baseline state of health. Admission CSI was comparable to the aggregate of all patient variables in its correlation with hospital costs (r2 = 0.23 vs. r2 = 0.24, respectively) and lengths of stay (r2 = 0.23 vs. r2 = 0.24, respectively). Maximum CSI had the highest correlation coefficient with hospital costs (r2 = 0.42) and lengths of stay (r2 = 0.41), whereas the correlation of admission Pediatric Risk of Mortality III scores with costs was r2 = 0.12 and with lengths of stay was r2 = 0.07. CSI scores also correlated well with measures of resource utilization in subgroups of bronchiolitis patients with comorbidities or other risk factors for severe disease.

CONCLUSIONS

CSI scores correlate well with resource use in pediatric patients hospitalized with bronchiolitis. This severity scoring system may be useful in assessing the cost-effectiveness of their care.

Modeling of high-cost patient distribution within renal failure diagnosis related group

Modeling by mixed-distribution was proposed in order to analyze heterogeneity of costs and length of stays within Diagnosis Related Groups (DRGs). A mixed-distribution model based on Weibull distributions was applied to 791 discharge abstracts of French DRG no. 450 (Health Care Financing Administration 3 DRG no. 316 "Renal failure") from a national database. Three subgroups of cost and length of stay were identified. Except for age, clinical criteria significantly linked with the long-stay subgroup were the same as those associated with the high-cost subgroup: acute renal failure, intensive care, infectious complications, and vascular investigations. The identification of factors associated with high costs, based on the proposed model, will allow physicians to understand more accurately how their choice of specific procedures influences hospital costs.

High cost factors for leukaemia and lymphoma patients: a new analysis of costs within these diagnosis related groups

STUDY OBJECTIVE

To determine high cost factors to help managers and clinicians to analyse the reasons of adverse costs and provide indications for financial negotiation.

DESIGN

To locate high cost or long stay patients, the analysis was designed on the basis of a mixture of Weibull distributions. In this new model, the proportion of high cost patients was expressed according to the multinomial logistic regression, permitting the determination of high cost factors.

SETTING

The 1993 French reference database, constituted in the framework of the national study of DRG costs, conducted by the French Ministry of Health. The database of discharge abstracts recorded in 1993 in the Dijon public teaching hospital.

PARTICIPANTS

The analyses were based on 1352 abstracts from the French reference database and 368 from the Dijon database concerning patients, aged 18 and over, suffering from leukaemia and lymphoma.

MAIN RESULTS

High cost and long stay factors were the same: number of stays, death, transfer, acute leukaemia, neutropenia, septicaemia, high dose aplastic chemotherapy, central venous catheterisation, parenteral nutrition, protected or laminar airflow room, blood transfusion, and intravenous antibiotherapy.

CONCLUSIONS

Taking into account high cost predictive factors, as shown in the case of leukaemia and lymphoma patients, would help to reduce the adverse effects of a prospective payment system.

Principles of disease management in neonatology

This article emphasizes the emerging facets of disease-management practice that impact directly on establishing a measured care system that can produce the information needed to establish a continuous quality improvement program. The areas discussed are risk assessment, clinical management guidelines and carepaths, and the measurement of system output known as clinical outcomes. The remainder of the article details the aspects of risk assessment, guideline function, and outcome assessment, critical in a disease-managed measured care system.

[Severity of illness explains the inadequacy between diagnosis-related groups and intensive care patients. Groupe GHM]

OBJECTIVE

To assess the relationship between diagnosis related groups (DRG) and severity of illness in intensive care unit (ICU) patients in semf1tical and economical terms.

STUDY DESIGN

Prospective, multicentric study including 13 medical and surgical ICUs for adults.

MATERIAL

Discharge reports of 3,215 ICU admissions including age, gender, diagnosis, organ system failures, length of stay (LOS) and severity of illness evaluated with severity scores (SS): simplified acute physiological score (SAPS). Apache II, Glasgow score and physiological score (PS).

METHODS

Semantical homogeneity was evaluated from the percentage of well-classified patients established from the comparison between the official computerized method and a non-computerized method applied by three clinical experts. Economical homogeneity was evaluated from the relationship between SS and LOS.

RESULTS

In total, 88% (CI: 87.7-88.2) of ICU stays were classified in eight main categories of diagnosis (MCD). According to the MCD, the percentage of well-classified patients varied from 28% (CI: 27.6-28.3) to 97% (CI: 96.8-97.1), decreasing with the association of several diagnoses and organ system failures. There was a large variability in the LOS of DRG and a significant correlation between LOS and SS was found in only 8/16 DRG.

CONCLUSION

The fact that the severity of illness is not taken into account in the elaboration of DRGs explains the inadequacy of the DRG system in intensive care.

Models for determining cost of care and length of stay in neonatal intensive care units

New models for determining the cost of care and length of stay in the neonatal intensive care unit (NICU) were developed using financial and clinical data from 588 admissions to our NICU. The model for determining costs explained 71% of the variability in total hospital costs. Models such as the ones developed in this study can be used to compare costs in different institutions, determine temporal trends in costs, and examine the financial impact of using new technologies. Such models can also be useful components of a rational prospective pricing system for the NICU.

Effect of patient factors on hospital costs for major bowel surgery: implications for managed health care

BACKGROUND

We examined the effects of patient factors on hospital resource consumption for patients who had undergone major bowel operation (diagnosis-related groups [DRGs] 148 and 149) at an urban, university hospital.

METHODS

We performed cross-sectional analysis of computerized hospital discharge abstracts and charts of 491 consecutive discharges in these DRGs. Total hospital charges and length of stay were dependent variables. Independent variables included admission status, admission service, previous admissions, payer type, service type, diagnosis, reoperation, and death.

RESULTS

Patient factors accounted for significant variability in resource consumption. By univariate analysis all of the above variables significantly affected total charges, and all but service type significantly affected length of stay. By multivariate analysis DRGs 148/149 alone explained 4.2% of the variance, whereas all the variables together increased R2 to 52.1%. Logistic regression of reoperation and of death as dependent variables suggested that patient factors also accounted for significant variance in these outcomes.

CONCLUSIONS

Because patient factors may not be directly controllable by hospitals or physicians, differences among hospitals in costs and in "quality" may relate more to differences in patient mix than to efficiency. DRGs alone are not a sufficient management tool, and additional measures are needed to adequately measure both efficiency and quality.

Relationship between severity, costs and claims of hospitalized patients using the Severity of Illness Index

The results of the prospective application of Horn's 'Severity of Illness Index' in a teaching hospital during 1987, 1989, and 1990 constitute the basis of the present report. The average overall severity of illness scores for the three years were 1.42 in 1987, 1.65 in 1989, and 1.46 in 1990. Most of the processes evaluated in the three periods showed an overall distribution among severity levels 1 and 2, both overall and when the seven dimensions of the severity of illness index were analyzed. A statistically significant correlation between the overall severity of illness and average length of stay was found for patients in 1989 and 1990. The length of stay differed significantly in the different severity levels. When the four levels of the seven dimensions of the severity of illness index for 1987, 1989, and 1990 were compared, it was observed that figures were not uniformly distributed. There was a statistically significant association between severity of illness for hospital service and pharmacy charges per hospital stay for both 1989 and 1990, as well as a statistically significant inverse relationship between severity of illness and the number of claims per hospital service in both periods of time. Case-mix methods that account for the severity of patients constitute a useful indicator of quality for the management of different hospital services and of the hospital as a whole.

Explaining cost variations in DRGs 'Acute Myocardial Infarction' by severity of illness

The empirical relationship is analyzed between the severity of illness and costs of medical care for 464 patients classified into DRGs 121-123, Acute Myocardial Infarction (AMI), in the University Hospital, Maastricht. Severity of cardiac and cardiovascular disorders characteristic of acute myocardial infarction is defined and operationalized in a sense that closely resembles the clinical practice of cardiologists. The effect of the severity of illness on DRG cost variations is studied separately for the costs of acute care (such as thrombolytic therapy, cardiac catheterization and percutaneous transluminal coronary angioplasty (PTCA)), length of hospital stay, costs of intensive nursing care at the coronary care unit (CCU) and the costs of ECGs, laboratory tests, echocardiography, exercise tests and drugs. For AMI patients, severity of illness measured by specific clinical criteria is found to give better predictions (higher R2) for costs of medical care than the DRG classification.

Measuring case mix and severity of illness in Canada: case mix groups versus refined diagnosis related groups

This study compares the effectiveness of Case Mix Groups (CMG*) groups and Refined Diagnosis Related Groups (RDRG) in reducing Canadian length of stay (LOS) variability. The effectiveness of the two case mix grouping methodologies was assessed with a common data base, 282,459 abstracts with ICD-9 CM diagnosis codes reported to the Hospital Medical Records Institute (HMRI) from January to March 1989. Death, signouts, transfers to or from acute care institutions and cases with an outlier LOS ("atypical" cases) were excluded from the analysis. HMRI utilization management reports to acute care hospitals use a data base defined in this way. On the basis of the variance reduction statistic (R2) from ordinary least squares regression analysis, CMG groups were found to be slightly more effective than RDRGs in reducing LOS variability. R2 statistics were 45.7 and 43.8 for CMG groups and RDRGs, respectively. Within subgroups of cases, CMG groups were found to be markedly more effective with the newborn/neonate group and to a lesser extent with non-surgical cases. The severity of illness categories within RDRGs did not, over all "typical" cases in the data base, yield more homogeneous groups of cases than CMG groups, which have half the number of categories. The value of tailoring severity measurement to Canadian medical practice and Canadian diagnosis coding is highlighted.

A description and clinical assessment of the Computerized Severity Index

Recent initiatives expanding health care data networks have increasingly emphasized severity of illness information, both to improve fairness of hospital payment and to assist in widespread assessment of hospital and physician quality. The Computerized Severity Index (CSI), one of the newest severity tools to generate interest, is disease specific and produces scores from 1 to 4 at both the disease and overall patient levels. Severity is defined as "the treatment difficulty presented to physicians due to the extent and interactions of patient's diseases." The clinical logic of the severity rating system is readily available through the "severity matrices" associated with over 820 disease groups. Questions exist about the CSI's dependence on diagnostic coding and the qualitative nature of some of the clinical criteria. More study is required to assess the utility of the CSI for various health policy purposes.

Utilization management: a literature review for Canadian health care administrators

Utilization management (UM), the attempt to measure, understand and reduce inappropriate hospital use, has been in development for over 20 years. It is an outgrowth of two related phenomena: (1) the increasing responsibility of large institutional third party payers for health care costs and the increasing demand of those payers for accountability; and (2) in Canada, particularly, the debate surrounding the adequacy of hospital funding and the perceived inadequacy of cost control using global budgeting. Given the interest in UM, hospital administrators, provincial and federal associations representing hospitals, hospital employees and physicians would find a review of UM programs useful in terms of what is known about their effectiveness, and the specific initiatives in Canada. The authors underscore the critical need for formal evaluation of UM programs; to date there has been little systematic research into issues related to its implementation and impact. This issue is particularly pertinent because UM programs have not been widely implemented in Canada.

Methods of determining the cost of health care in the Department of Veterans Affairs medical centers and other non-priced settings

Cost is increasingly important in the evaluation of health care. Though charges are often used as a proxy for cost, some health care systems such as the Veterans Administration do little or no billing. This article describes, presents examples of, and evaluates four options for determining the cost of care within the Department of Veterans Affairs: measuring input costs, the Department's cost accounting system, the reimbursement system, and use of charges from a surrogate health care facility. Each approach is evaluated for accuracy, ability to compare the costs of different treatments, and effort required to estimate cost.

Trauma case mix and hospital payment: the potential for refining DRGs

Uniform hospital discharge abstract data from Maryland were used to examine the homogeneity of trauma-related DRGs with respect to a well-established measure of injury severity, the Injury Severity Score (ISS). Thirty DRGs were identified as including trauma cases with a wide range of severity; for each of these DRGs, ISS explains a significant amount of variation in length of stay. By applying statistical techniques similar to those used to create the original DRG groupings, these 30 DRGs were subdivided by severity and age categories to create a new set of severity-modified DRGs. The potential effects of using DRGs and modified DRGs to pay for inpatient care within the Maryland state regionalized system of trauma care were examined. Payments based on regional averages per DRG and per modified DRG were compared to actual hospital charges regulated by the state's Health Services Cost Review Commission. Using average charges per DRG as a basis of payment, approximately !1.4 million (11 percent of total hospital charges) would be shifted from trauma centers to nontrauma centers. This shift represents an 18 percent loss in revenues to trauma centers and a 30 percent gain in revenues to nontrauma centers. Using a payment system based on severity-modified DRGs, trauma centers would still experience a net loss in revenues and the nontrauma centers a net gain, but the total amount of the shift would be reduced from $11.4 million to $9.8 million. The results argue for the need to explore alternative payment systems not strictly based on current DRGs. Because of DRGs do not adequately reflect severity differences, using them to pay hospitals will create financial incentives that discourage regionalization of trauma care.

Management information and self-governing NHS hospital trusts

The proposal for self-governing hospital trusts within the NHS, announced in the White Paper Working for Patients on 31 January 1989 and enacted through passage of the National Health Service and Community Care Act 1990 last July, introduces free market incentives to NHS hospitals. Hospitals applying for self-governing status must first demonstrate that they have an information system appropriate to support decision making in the new context. An overall information systems flow and an approach to information systems development are recommended based upon the Freeman Hospital model. The Freeman Hospital is a national pilot site selected by the NHS Management Executive for development of information systems for NHS hospitals.

Measuring patient intensity. A reliability study

The purpose of this study was to determine the interrater reliability for each of 12 dimensions of a measure of Patient Intensity for Nursing (PINI). Three hospitals in two states participated in this project with 121 Registered Nurses prepared in the use of the PINI. The interrater reliability was determined by day shift nurses rating their patients late in the shift and evening shift nurses rating the same patients early in their shift. Paired ratings of 657 patients were included in this analysis, and the reliability was substantial (kappa = greater than .60) for 10 of the 12 dimensions across hospitals. These findings provided the foundation for revision of the instrument, which is currently undergoing additional testing.

The effect of resident involvement on community hospital charges

Attempts to explain the high cost of care in teaching hospitals have yielded conflicting results. This study was conducted to compare hospital charges and lengths of stay for two groups of patients: one cared for by a resident team and the other cared for by attending physicians. The study was conducted at a university-affiliated hospital in Portland, Oregon. An initial group of 5,451 admissions was examined, considering type of doctor (resident or attending), severity of illness, and patient demographic characteristics. A regression analysis revealed that total charges were similar in the two groups, but only 14% of the variance in log total charges was explained. A subgroup of 1,058 admissions in the eight most common diagnosis-related groups (DRGs) was further evaluated. In this analysis total charges for the resident patient group were 52% higher than charges for the patient group cared for by attending physicians. Forty-one per cent of the variance was explained, with type of doctor and severity of illness accounting for 5% and 10%, respectively. Further examination of one DRG indicated that additional factors not included in previous studies, such as extent of preadmission evaluation, ethical factors influencing treatment options, and patient expectations for care, may be important determinants of hospital charges. This study demonstrates that the high cost of resident care is not fully explained by currently available measures.

DRGs and severity of illness measures: an analysis of patient classification systems

Concerns about inefficiency and excessive expenditures has stimulated interest in the measurement of the output of the hospital, an organization that produces a wide variety of products. Diagnosis Related Groups and a number of severity measures including Disease Staging, the Severity of Illness Index, and Patient Management Categories are described and evaluated. Using criteria such as reliability, clinical validity, homogeneity, number of categories, and data acquisition costs, the analysis suggests that while none of the hospital patient classification systems is perfect, great strides have been made in reflecting the multiproduct nature of the hospital.

Description of case-mix adjusters by the Severity of Illness Working Group of the Society of Hospital Epidemiologists of America (SHEA)

Hospitals, insurance companies, and federal and state governments are increasingly concerned about reducing patient cost expenditures while maintaining high quality patient care. One method of reducing expenditures has been to tie hospital reimbursement with a prospective payment system based on diagnosis-related groups (DRGs). However, reimbursement under the DRG system is not acceptable for all patients in all hospitals because it is neither an accurate predictor of costs nor of clinical outcome. This deficiency poses significant problems for hospitals because DRGs are used nationwide as the prospective payment system for inpatients covered by Medicare. Several case-mix adjusters have been proposed to modify DRGs to improve their accuracy in predicting costs and outcome. We reviewed five of the most widely available indices: Acute Physiologic and Chronic Health Evaluation (APACHE II), Coded Disease Staging, Computerized Severity Index (CSI), Medical Illness Severity Group System (MEDISGROUPS), and Patient Management Categories (PMC). Recommendations for the use of a single case-mix adjuster cannot be made at this time because all indices have not been compared in sufficiently diverse settings and because some are better predictors of costs while others are better predictors of clinical outcome. Hospital epidemiologists and other infection control practitioners should be informed about these indices and their potential applications as they expand their role beyond infection control problems to issues concerning cost containment, quality assurance, and reimbursement.

Economic outcome under Medicare prospective payment at a tertiary-care institution: the effects of demographic, clinical, and logistic factors on duration of hospital stay and part A charges for medical back problems (DRG 243)

We investigated the effects of prospectively identified factors on the duration of hospital stay and part A charges in 240 hospitalizations (of 230 patients) for the diagnosis-related group "medical back problems" (DRG 243) at a tertiary-care institution in 1985 to determine whether heterogeneity existed within this reimbursement category. We confirmed our initial postulates that nonosteoporotic fractures and neck problems, as well as hospitalizations primarily for myelography after outpatient neurologic evaluation, had considerably different economic outcomes and thus excluded these categories from further analysis. Statistical analysis (forward stepwise regression) of the remaining 132 patients who had "general medical back problems" showed that increasing age, associated osteoporosis, and therapeutic injections best explained variation in the natural logarithm of duration of stay (R2 = 0.16). Total number of diagnoses, spondylosis, associated osteoporosis, age, therapeutic injections, and performance of special procedures best explained the variation in the logarithm of part A charges (R2 = 0.29). The ability to identify factors within a specified category that affect the duration of hospitalization and part A charges jeopardizes the fairness of prospective payment, and we believe that DRG 243 should be adjusted for age, comorbidity, and readily identifiable clinical syndromes that have disparate economic consequences. Because of poorly substantiated efficacy and a significant association with longer hospital stays and higher part A charges, clinicians should review the use of therapeutic injections for medical back problems. Analysis of case-mix such as ours should be helpful in promoting efficient practice and ensuring the fairness of any reimbursement system.

Refining case-mix adjustment. The research evidence

We review case-mix adjustment, which is the process of adjusting for differences in the cases treated in different hospitals so that their costs or outcomes can be compared. We examine the Medicare payment system, which rests on case-mix adjustment, and identify areas, including outlier payments, in which payment accuracy might be improved without better measurement of the severity of illness. There is no available measure of severity of illness that would produce a large improvement in the accuracy of Medicare payments if used to supplement or replace the system of diagnosis-related groups. Evidence regarding whether better measurement of severity would substantially change the distribution of payments across hospitals is mixed. Considerable evidence suggests that the intensity of medically appropriate treatment for patients in the same diagnosis-related group varies substantially for reasons other than the severity of illness. Despite great demand for measures of the quality of care, important technical problems must be solved before we can be confident that differences in case-mix-adjusted outcomes reflect differences in the quality of care.

Automatic extraction of intensity-intervention scores from a computerized surgical intensive care unit flowsheet

Systems that objectively score severity of illness and intensity of patient care interventions have been used to guide the appropriate use of intensive care facilities, provide information on nurse staffing ratios, validate subjective classifications of patient illness, and normalize scientific and financial studies for severity of illness. Existing scoring systems require a well-trained observer to perform a thorough chart review to complete manual scoring forms. We have designed a new system in which computerized intensity-intervention scores are automatically extracted from electronic intensive care unit flowsheets, eliminating both manual labor and potential observer variation. In prospective studies, these computerized scores correlated well with manual TISS scores, intensive care unit mortality, intensive care unit length of stay, hospital length of stay, and a subjective classification of patients to graded levels of hospital care. Such automated scores may be used for real-time allocation of health care resources and normalization of prospective studies for severity of illness.

Need for better severity indexes of acute myocardial infarction under diagnosis-related groups

Clinical, demographic and administrative data, including length of stay and institutional charges, were examined for 219 patients hospitalized for acute myocardial infarction (AMI). Neither length of stay nor charges differed among AMI patients with or without cardiovascular complications as defined by Medicare's diagnosis-related group (DRG) categories (DRG 121 and 122, respectively) for patients who are discharged alive. Myocardial enzyme peak levels are the best predictors of hospital resource consumption for patients with AMI when considered alone or in combination with other factors. The "cardiovascular complications" designated by discharge diagnoses did not reflect resource consumption in our patient population. Sixteen percent of the patients studied underwent cardiac catheterization during hospitalization. These patients stayed in the hospital longer and incurred 70% higher charges; nevertheless, they were grouped with the remaining AMI patients in the current DRG formulation. Clinical evaluations such as cardiovascular complications are subject to interpretation, and are therefore less credible than enzyme measurements for recognizing the severity of a patient's AMI. Reimbursement based on objective measurements may avoid payment inequities.

Case classification and quality of care: issues to consider before making the investment

Hospitals are considering adoption of patient classification systems, in part, because of their desire to create a clinically meaningful data base for quality assurance and monitoring. But before they make the substantial financial investment such a system requires, hospital personnel should be sure it is appropriate for their institution. The system should be reliable, medically meaningful, and useful in differentiating cases in which care was poor. The classification components should be easily available from the hospital's standard information. The cost of the system and its impact on staff should also be considered.

Policy issues related to prospective payment for pediatric hospitalization

Children's hospitals have been excluded from the Medicare prospective payment system (PPS) because of concerns over the applicability of the DRG case-mix system and PPS payment weights to pediatric hospitalization. Nevertheless, DRG-based payment systems are being adopted by State Medicaid agencies and private third-party payers, and the Health Care Financing Administration has been mandated to report to Congress on the feasibility of including children's hospitals in the Federal PPS. This article summarizes policy research on this issue and discusses options in the design of prospective payment systems for pediatric hospitalization.