Performance-related income budget. A means for reorganizing hospital financing

Abstract

Performance-related budgets are the result of negotiated performance units per hospital multiplied by state-wide negotiated prices. Such hospital budgets contain profit chances and loss risks. Exceeding the contractual fixed amount leads to price reductions, falling below that amount leads to lower reimbursement. A consistent pricing system for basic and department performance units could solve the present problem of cost separation in Germany. A step in this direction is the definition of hospital department groups and the construction of an average department treatment case, which could be priced on an average cost base. In the long run, more flexibility according to pricing and budgeting can be developed. Competitive insurance companies should be free to find their own budgets so that a hospital can have several independent contractors.