Detecting Undifferentiation of Tertiary and County Hospitals in China in Adoption of DRG Instrument

Do the diagnosis-related group payment reforms have a negative impact?-an empirical study from Western China

Background

The first Diagnosis-Related Group (DRG) Reimbursement pilots in China, which started in 2019, marked an essential step in cost control and service efficiency in Chinese hospitals, but some adverse effects inevitably emerged during the implementation of DRG in TCM (traditional Chinese medicine) hospitals. This study aims to explore the positive and negative effects of DRG payment reform and provide a reference for the reform of medical insurance payments in countries that retain traditional medicine.

Methods

Longitudinal data from two hospitals, Qingyang City Hospital of TCM and Tianshui City Hospital of TCM, were retrieved from China's Gansu Health for All Big Data Platform from June 2016 to June 2022, and the policy effects were assessed using the difference-in-differences (DID) method and mediated-effects model.

Results

The DRG reform reduced hospitalization costs, diagnostic costs, drug costs, and nursing costs by 6.5, 4.2, 7.9, and 26.2%, respectively, in the treatment group hospitals (p < 0.01), but increased the hospitalization times by 17.5% (p < 0.01); there was a "reimbursement bias" for patients with different types of medical insurance. In the treatment group hospitals, the primary beneficiaries of the reform were urban employees' basic medical insurance patients, whose costs decreased by 4.9% (p < 0.01), with a non-significant effect on out-of-pocket payment patients and free medical care patients; the hospitals in the treatment group tended to reduce the use of Chinese medicine unique diagnostic and therapeutic means and increase the proportion of western medicine treatments under the pressure of the supremacy of costs.

Conclusion

The reform of the DRG payment method has positively impacted the cost control of TCM hospitals, but it has also had some adverse effects. This poses a challenge and prompts a thought about how TCM hospitals can maintain their distinctive advantages by optimizing the design of the DRG system at present.

Differences in inpatient performance of public general hospitals following implementation of a points-counting payment based on diagnosis-related group: a robust multiple interrupted time series study in Wenzhou, China

OBJECTIVES

This study measures the differences in inpatient performance after a points-counting payment policy based on diagnosis-related group (DRG) was implemented. The point value is dynamic; its change depends on the annual DRGs' cost settlements and points of the current year, which are calculated at the beginning of the following year.

DESIGN

A longitudinal study using a robust multiple interrupted time series model to evaluate service performance following policy implementation.

SETTING

Twenty-two public general hospitals (8 tertiary institutions and 14 secondary institutions) in Wenzhou, China.

INTERVENTION

The intervention was implemented in January 2020.

OUTCOME MEASURES

The indicators were case mix index (CMI), cost per hospitalisation (CPH), average length of stay (ALOS), cost efficiency index (CEI) and time efficiency index (TEI). The study employed the means of these indicators.

RESULTS

The impact of COVID-19, which reached Zhejiang Province at the end of January 2020, was temporary given rapid containment following strict control measures. After the intervention, except for the ALOS mean, the change-points for the other outcomes (p<0.05) in tertiary and secondary institutions were inconsistent. The CMI mean turned to uptrend in tertiary (p<0.01) and secondary (p<0.0001) institutions compared with before. Although the slope of the CPH mean did not change (p>0.05), the uptrend of the CEI mean in tertiary institutions alleviated (p<0.05) and further increased (p<0.05) in secondary institutions. The slopes of the ALOS and TEI mean in secondary institutions changed (p<0.05), but not in tertiary institutions (p>0.05).

CONCLUSIONS

This study showed a positive effect of the DRG policy in Wenzhou, even during COVID-19. The policy can motivate public general hospitals to improve their comprehensive capacity and mitigate discrepancies in treatment expenses efficiency for similar diseases. Policymakers are interested in whether the reform successfully motivates hospitals to strengthen their internal impetus and improve their performance, and this is supported by this study.