SummaryThe use of casemix classifications to assist in the analysis of patient-based information is becoming more widespread and routine in the management of the National Health Service (NHS). This paper details the process of modification of and the results of modifications to Healthcare Resource Groups (HRGs), an in-patient classification tailor-made for the English healthcare system. Clinical expertise and extensive statistical analysis of national data were combined to identify areas of HRGs Version 2 where improvement could be made. The ensuing changes were then reviewed by professional associations and the wider NHS before being incorporated into grouping software. Extensive changes were made to the classification, with significant gains in statistical performance. Analysis shows that the revised groupings perform better on English data than other available systems.