Effects of a mandatory DRG payment system in South Korea: Analysis of multi-year nationwide hospital claims data

Abstract

BackgroundIn 2002, a voluntary diagnosis-related groups (DRGs) payment system was introduced in South Korea for seven disease groups, and participation in the DRGs was mandated for all hospitals beginning in 2013. The primary aim of this study was to compare results reflective of patient care between voluntary participation hospitals (VPHs) and mandatory participation hospitals (MPHs) governed by either the DRGs or fee-for-service (FFS) payment system.MethodsWe collected DRGs and FFS inpatient records (n=3,038,006) from the Health Insurance Review and Assessment for the period of July 2011 to July 2014 and compared length-of-stay, total medical costs, shifting services to an outpatient setting, and readmission rates according to payment system, time of DRGs implementation, and hospital type. We analyzed the effects of mandatory introduction in DRGs payment system on results for patient care and used generalized estimating equations with difference-in-difference methodology.ResultsMost notably, patients at MPHs had significantly shorter LOS and lower readmission rates than VPH patients after mandatory introduction of the DRGs. Shifting services to an outpatient setting was similar between the groups.ConclusionsOur findings suggest that the DRGs payment policy in Korea has decreased LOS and readmission rates. These findings support the continued implementation and enlargement of the DRGs payment system for other diseases in South Korea, given its potential for curbing unnecessary resource usage encouraged by FFS. If the Korean government deliberates on expansion of the DRGs to include other diseases with higher rates of complications, policymakers need to monitor deterioration of health care quality caused by fixed pricing.

Effect of enhanced recovery after surgery in the managements of ankle fracture patients: A single-center retrospective cohort study

“…The nding application of ERAS can reduce the costs and LOS may assist staff and patients pay more attention to the application of ERAS during clinical practice. DRGs payment system was introduced and mandated worldwide for its potential to curbing unnecessary resource and cost-saving implications by decreasing costs and LOS [28,29]. Relevant literatures re ected that healthcare system assess satisfaction and quality of the inpatients, which highlights the speci cation of ERAS [30,31].…”

<p>Adjusting Quality Control Chart Limits for WBC, RBC, Hb, and PLT Counts to Reduce Daily Control Risks in Hospital Laboratory</p>

“…Nearly all inpatients, about half of patients in the emergency department, and nearly one-third of outpatients had laboratory results during their visit to the health-care center, 15 comprising a quite portion (5-6%) of the total cost of healthcare. 16,17 If we can improve the quality of CBC's lab test reports, coupled with future cloud consolidation to avoid duplicate testing…”

“…Nearly all inpatients, about half of patients in the emergency department, and nearly one-third of outpatients had laboratory results during their visit to the health-care center, 15 comprising a quite portion (5–6%) of the total cost of healthcare. 16 , 17 If we can improve the quality of CBC’s lab test reports, coupled with future cloud consolidation to avoid duplicate testing in the different hospitals even the same hospital, we believe that many health insurance medical expenses can be reduced, while improving the quality of care. At present, there is no golden standard protocol for clinical test personnel to perform parallel testing of QC reagents with new and old batch numbers as part of their CBC routine.…”

The New Diagnosis-Related Group Reimbursement System and Laboratory Test Quality in Korea: Analysis of External Quality Assessment Results

“…DRGs bear inherent risks of potential harm to patients by quality of health services to reduce the cost of healthcare. Previous studies showed that implementing DRGs decreased the duration of stay and out-of-pocket costs [ 5 ] as well as significantly reducing examination fees relative to fee-for-service (FFS) [ 6 ].…”

“…Laboratory tests are a large part of modern medicine. Nearly all inpatients, about half of patients in the emergency department, and nearly one-third of outpatients had laboratory results during their visit to the healthcare center [ 12 ], comprising a small portion (5–6%) of the total cost of healthcare [ 5 , 6 ]. Since poor laboratory results can significantly impact patients’ care, monitoring and improving the quality of laboratory tests is crucial [ 13 ].…”