Implementation Of Diagnosis-related Groups Research Articles

Evaluation of the effect of DRG payment policy based on interrupted time series modeling: evidence from a tertiary hospital in Anhui Province

BackgroundThe payment methodology for diagnosis-related groups (DRG) has implications for both society and medical institutions. Our study aims to analyse the impact of the reform of the payment policy according to the DRG on the operation of a tertiary hospital in Anhui Province.MethodsMonthly data were collected from April 2020 to September 2023 during the reform period for a tertiary hospital on nine types of operational indicators, including average length of stay (ALOS), number of discharges, number of outpatient visits, percentage of discharged patients undergoing level III or IV surgery, bed turnover rate, inpatient essential drug utilization rate, low-risk group mortality, outpatient subaverage cost and inpatient subaverage cost. The data were divided into two phases according to the time of DRG implementation: pre-reform (April 2020–December 2021) and post-reform (January 2022–September 2023), and the segmented regression model with interrupted time series data was used to analyse the changes in the trend of each type of indicator before and after the reform. Statistical analysis was performed using R software (4.3.1).ResultsAfter the implementation of the DRG, the number of discharges increased by 112 800 patients (95% confidence interval [CI] 31.125–194.484, P = 0.008), the bed turnover rate rose by 1.403% (95% CI 1.028–1.778, P = 0.022) and the percentage of discharged patients undergoing level III or IV surgery decreased by 0.098% (95% CI −0.181 to −0.015, P = 0.022). The low-risk group mortality decreased by 0.016% (95% CI −0.027 to −0.005, P = 0.007), and the inpatient subaverage cost decreased by 81.514 CNY (95% CI −121.782 to −41.245, P < 0.001). However, there were no significant differences in the trends of average length of stay, outpatient visits, inpatient essential drug utilization rate and outpatient subaverage cost after the DRG implementation.ConclusionsThe findings show that the DRG reform has positively impacted hospital functioning, including quality, safety, efficiency and costs. Although the average length of stay remained unchanged, there was an increase in discharged patients and outpatient visits, indicating hospitals adapted to the new payment model. The reduction in low-risk group mortality suggests improvements in patient safety and care quality. However, challenges remain, as evidenced by decreased surgical complexity and initial drops in bed turnover rates. While the DRG reform holds promise for enhancing healthcare efficiency and controlling costs, potential negative effects such as patient selection bias and coding changes need to be monitored. Future research should focus on the long-term effects of the DRG policy across different healthcare institutions.

Study on the impact of the DRG model on human resource allocation at public hospitals

Diagnosis-related groups (DRGs) are gaining prominence in healthcare systems worldwide to standardize potential payments to hospitals. This study, conducted across public hospitals, investigates the impact of DRG implementation on human resource allocation and management practices. The research findings reveal significant changes in job roles and skill requirements based on a mixed-methods approach involving 70 healthcare professionals across various roles. 50% of respondents reported changes in daily responsibilities, and 42% noted the creation of new roles in their organizations. Significant challenges include inadequate training (46%), and coding complexity (38%). Factor analysis revealed a complex relationship between DRG familiarity, job satisfaction, and staff morale. The study also found a moderate negative correlation between the impact on morale and years of service in the current hospital, suggesting that longer-tenured staff may require additional support in adapting to DRG systems. This study addresses a knowledge gap in the human resource aspects of DRG implementation. It provides healthcare administrators and policymakers with evidence to inform strategies for effective DRG adoption and workforce management in public hospitals.

Impact of Diagnosis-Related Groups (DRG) reform on cost homogeneity of treatment for patients with malignant tumours

The cost fluctuations associated with chemotherapy, radiotherapy, and immunotherapy, as primary modalities for treating malignant tumors, are closely related to medical decision-making and impose financial burdens on patients. In response to these challenges, China has implemented the Diagnosis-Related Group (DRG) payment system to standardize costs and control expenditures. This study collected hospitalization data from patients with malignant tumors who received chemotherapy, radiotherapy, and immunotherapy at Hospital H from 2018 to 2022. The dataset was segmented into two groups: the intervention group, treated with traditional Chinese medicine (TCM) alongside standard therapies, and the control group, treated with standard therapies alone. Changes and trends in hospitalization costs under the DRG policy were analyzed using propensity-score matching (PSM), standard deviation (SD), interquartile range (IQR), and concentration index (CI). Findings showed a decreasing trend in the standard deviation of hospitalization costs across all treatment modalities. Radiotherapy exhibited the most significant decrease, with costs reducing by 2547.37 CNY in the control group and 7387.35 CNY in the intervention group. Following the DRG implementation, the concentration indexes for chemotherapy and radiotherapy increased, while those for immunotherapy did not exhibit this pattern. Costs were more concentrated in patients who did not receive TCM treatment. In summary, DRG reform positively impacted the cost homogeneity of inpatient treatments for malignant tumors, particularly in the control group not receiving TCM treatment. The effects of DRG reform varied across different treatment modalities. Although short-term fluctuations in hospitalization costs may occur, initial evidence during the study period shows the positive impact of DRG reform on cost homogeneity.

Designing a model for implementing diagnosis-related groups in Iran: An action plan approach.

Implementing diagnosis-related groups (DRGs) in different countries increases the efficiency of healthcare services, improves treatment quality, and reduces treatment costs. Due to the lack of a coherent model for its implementation, the present study aimed to develop a DRGs-based implementation action plan Model for Iran. The present study was an applied, descriptive cross-sectional study conducted in three stages. In the first stage, a review of studies conducted in different countries was carried out. In the second stage, a model was designed for an action plan to implement the DRGs in Iran. In the third stage, the model was validated based on the Delphi technique. The DRGs-based implementation action plan model in Iran was designed in three primary axes, including the strategic approach of the DRGs-based implementation action plan, technical dimensions, and executive institutions involved in the DRGs-based implementation action plan. Validation of the designed model showed the agreement of experts (94%) for the mentioned axes. The significance of tailoring a DRGs-based implementation action plan to each country's unique context is well-established. Given the intricacies of the Iranian healthcare system, we recommend an initial pilot implementation of DRGs at the hospital level, followed by a gradual national rollout.

Comprehensive evaluation of disease coding quality in gastroenterology and its impact on the diagnosis-related group system: a cross-sectional study

ObjectiveAccording to the diagnosis-related group (DRG) requirement, issues of diagnosis and procedure coding in the gastroenterology department of our hospital were analyzed and improvement plans were proposed to lay the foundation for effective implementation of DRGs.MethodsThe title page of case-history of 1600 patients admitted to the Department of Gastroenterology of this hospital from January 1, 2021 to December 31, 2021 was sampled as a data source, and the primary and other diagnostic codes, operation or procedure codes involved in the title page of case-history were categorized and statistically analyzed.ResultsOf the 531 cases treated with gastrointestinal endoscopy in our hospital in 2021, coding errors were identified in 66 cases and unsuccessful DRG enrollment in 35 cases, including 14 cases with incorrect coding of the primary diagnosis (8 cases with unsuccessful DRG enrollment), 37 cases with incorrect coding of the primary operation (23 cases with unsuccessful DRG enrollment), and 8 cases with incorrect coding of both the primary diagnosis and the primary operation (4 cases with unsuccessful DRG enrollment). Analysis of 66 inpatient cases with coding problems showed a total of 167 deficiencies, including 36 deficiencies in major diagnoses, 84 deficiencies in other diagnoses, and 47 deficiencies in surgery or operation coding.ConclusionThe accuracy of coding of disease diagnosis and surgical operation is the basis for the smooth implementation of DRGs. The medical staff of this hospital has poor cognition of DRGs coding and fails to recognize the important role of the title page of case-history quality to DRGs system, and their attention to DRGs and knowledge base of disease classification coding should be improved. In addition, the high incidence of coding errors, especially the omission of disease diagnosis, requires increased training of physicians and nurses on clinical knowledge and requirements for DRGs medical records, thereby improving the quality of medical cases and ensuring the accuracy of DRGs information.

Implementation of diagnosis related groups in a high-complexity health institution in Colombia

One of the greatest challenges for health care institutions is to know the hospital product (HP), defined as patients, diagnoses and resources used in health care. Proper measurement of HP allows an effective resource management. The Diagnosis Related Groups (DRG) system facilitates the measurement of HP, classifying patients according to their characteristics, complexity, and resource consumption. To describe the implementation of DRGs in a high complexity health care institution in Colombia and to describe the incidence of coding errors. A random sample of 98 episodes was selected out of 3802 episodes registered from June to September 2019. We described the cumulative incidence of errors in the assignment of main diagnoses, procedures and the variable "Present on admission" (POA). An incorrect assignment of the main diagnosis was found in 18/98 episodes (18%, 95% confidence intervals (CI)11-27). Seventeen of 98(17%-95% CI10.4-26) and 8/98(8%-95% CI 3.6-15) had incorrect assignment of POA ("NO" or "YES" respectively). Eighteen episodes had at least one procedure incorrectly assigned (19% - 95%CI (11.4 - 28.5)). The use of DRGs improves hospital efficiency. Its implementation is possible in health care institutions in Colombia. However, the commitment of the institution's clinical and administrative staff is essential.

Diagnosis-Related Group (DRG)-Based Prospective Hospital Payment System can be well adopted for Acute Care Surgery: Taiwanese Experience with Acute Cholecystitis.

Laparoscopic cholecystectomy (LC) is a common procedure for cholelithiasis paid by diagnostic-related groups (DRGs) systems. However, acute cholecystitis (AC) patients usually have heterogeneous conditions that compromise the successful implementation of DRGs. We evaluated the quality/efficiency of treating AC patients under the DRG system in Taiwan. All AC patients who underwent LC between October 2015 and December 2016 were included. Patient demographics, treatment outcomes, and financial results were analyzed. Patients were reimbursed by one of the two DRG schemes based on their comorbidities/complications (CC): DRG-1, LC without CC; and DRG-2, LC with CC. Hospitals were reimbursed the costs incurred if they were below the lower threshold (balanced sector); with the outlier threshold if costs were between the lower and outlier thresholds (profitable sector); and with the outlier threshold plus 80% of the exceeding cost if costs were higher than the outlier threshold (profit-losing sector). Among 246 patients, 114 were paid by DRG-1, and 132 were by DRG-2. In total, 195 of 246 patients underwent LC within 1 day after admission, and patients with mild AC had shorter hospital stays than those with moderate or severe AC. The complication rate was 7.3% with only one mortality. In total, 92.1% of patients in DRG-1 and 90.9% of patients in DRG-2 were profitable. The average margin per patient was 11,032 TWD for DRG-1 and 24,993 TWD for DRG-2. DRGs can be well adopted for acute care surgery, and hospitals can still provide satisfactory services without losing profit.

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

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.

The effect of diagnosis-related group payment system on the quality of medical care for pelvic organ prolapse in Korean tertiary hospitals.

PurposeTo assess changes in clinical practice patterns after implementing diagnosis-related group (DRG) payment system in July 2013 and its effect on the quality of care for pelvic organ prolapse (POP).Materials and methodsUsing the 2011–2016 administrative database from National Health Insurance claim data, we reviewed medical information of 7362 patients who underwent hysterectomies for POP in Korean tertiary hospitals. We compared changes in several variables including length of stay, concomitant procedures, outpatient visits and readmission within 30 days after discharge, and retreatment for POP or stress urinary incontinence within postoperative 1 year before and after DRG system.ResultsAfter the introduction of DRG system, the average length of stay decreased (7.74 ± 2.88 to 6.63 ± 2.18 days, p<0.001) without increasing readmission rates. However, the number of outpatient visits increased (2.78±2.33 to 2.98±2.47, p<0.001). Regarding concomitant procedures, the rates of colpopexy and midurethral slings significantly decreased (7.87% and 9.84% to 4.93% and 2.93%, respectively, all p<0.001). Even though there was no difference in the reoperation rates, pessary insertion for recurrent POP significantly increased after the introduction of DRG system (0.10% to 0.38%, p = 0.015).ConclusionThe implementation of DRG in Korean tertiary hospitals has led to increase of outpatient visits and reduced surgical management for POP, which indicates that the uniform application of DRG influences the quality of care for POP patients.

Diagnosis-related group (DRG)-based case-mix funding system, a promising alternative for fee for service payment in China.

Fee for services (FFS) is the prevailing method of payment in most Chinese public hospitals. Under this retrospective payment system, medical care providers are paid based on medical services and tend to over-treat to maximize their income, thereby contributing to rising medical costs and uncontrollable health expenditures to a large extent. Payment reform needs to be promptly implemented to move to a prospective payment plan. The diagnosis-related group (DRG)-based case-mix payment system, with its superior efficiency and containment of costs, has garnered increased attention and it represents a promising alternative. This article briefly describes the DRG-based case-mix payment system, it comparatively analyzes differences between FFS and case-mix funding systems, and it describes the implementation of DRGs in China. China's social and economic conditions differ across regions, so establishment of a national payment standard will take time and involve difficulties. No single method of provider payment is perfect. Measures to monitor and minimize the negative ethical implications and unintended effects of a DRG-based case-mix payment system are essential to ensuring the lasting social benefits of payment reform in Chinese public hospitals.

Levels of Patient Satisfaction on Integrative Medicine Before and After Implementation of Diagnosis-related Groups.

ObjectivesThe aim of this article is to study patient satisfaction with complementary and alternative medicine (CAM) in an in-hospital setting before and after the introduction of diagnosis-related groups (DRGs).MethodsPatients were interviewed regarding a general evaluation of their hospital stay, the psychological talking therapy, the nutrition therapy, and the overall success of the treatment.ResultsThe medical treatment was evaluated by 1158 patients. A very good success was reported by 347, a good by 609, a moderate by 181, and none by 21 patients. DRG implementation showed no significant effects. Psychological talking therapy was evaluated as “very good” (P ≤ .05). With regard to the success of the medical talking and nutrition therapy, there were no significant differences (P ≥ .05) between the time before and after DRG implementation.ConclusionBroadening conventional medical treatment with CAM practices can lead to a parallel treatment of DRGs in hospitals working with complementary medicine. This results in very patient-centered therapies, which may impact patient satisfaction.

The impact of introducing a new hospital financing system (DRGs) in Poland on hospitalisations for atherosclerosis: An interrupted time series analysis (2004–2012)

ObjectivesHospital payment based on diagnosis-related groups (DRGs) was introduced in Poland in July 2008. We evaluate the impact of this policy on the frequency of hospitalisation for atherosclerosis in internal medicine units of district hospitals and non-public hospitals in Poland. MethodsData were collected between 2004 and 2012 from each district and non-public hospital participating in the General Hospital Morbidity Study (165 hospitals in total). Atherosclerosis was defined using the ICD-10 code I70. Hospitalisation patterns were examined using interrupted time series with segmented regression analysis. Results were compared between public and non-public hospitals and across patient age groups. ResultsThe rate of hospitalisation for atherosclerosis rose by 27.05 per 10,000 total hospitalisations immediately following the implementation of DRGs in 2008. It then rose by 2.5 per 10,000 hospitalisations monthly between 2008–2012. The largest changes were observed for patients aged 85+ and 75–84. Rates rose by 117.5 and 54.2 per 10,000 hospitalisations in these two groups respectively following implementation of DRGs. The response to introduction of DRGs was less striking in non-public hospitals than in public hospitals. ConclusionsImplementation of a DRG-based system in Poland was associated with substantial increases in atherosclerosis hospitalisation rates. Failing to take into account this change in financing and not accounting for long-term trends in hospitalisation rates may result in inaccurate epidemiological data.

Arbeiten im Krankenhaus: der Umgang von Beschäftigten mit der Ökonomisierung

As a result of reforms in the German system of inpatient health care, in particular through the implementation of diagnosis-related groups there has been an economization of the system. The consequences have affected the employees and their working conditions. Moreover, economization has led to a potential conflict between economic and job-specific logic of action. Since its beginning, some time has passed and the changes that have taken place have become normality in health care. This paper focuses on the question of how employees in the hospitals deal with their working conditions and different action impulses, more than a decade after the reforms. Based on qualitative interview data, three practices among physicians and nurses can be reconstructed: the balancing between advantages and disadvantages, the interest in an economically stable environment and the utilisation of internal and external resources by the employees.

Introducing Diagnosis-Related Groups in Kazakhstan: Evolution, achievements, and challenges

In 2012, Kazakhstan introduced Diagnosis-Related Groups (DRGs), as part of a package of reforms which sought to contain costs and to improve efficiency and transparency in the health system; but the main challenge was to design and implement a DRG system in just one year.In 2011–2012, Kazakhstan developed its own DRG system. Initially 180 DRGs were defined to group inpatient cases but this number was subsequently expanded to more than 400. Because of time limits, the cost weights had to be derived in the absence of existing standard hospital cost accounting systems, and a national patient data transfer system also needed developing. Most importantly, huge efforts were needed to develop a regulatory framework and build up DRG capabilities at a national level.The implementation of DRGs was facilitated by strong political will for their introduction as part of a coherent package of health reforms, and consolidated efforts to build capacity. DRGs are now the key payment mechanism for hospitals. However the reforms are not fully institutionalized: the DRG structure is continuously being refined in a context of data limitations, and the revision of cost weights is most affected by insufficient data and the lack of standardized reporting mechanisms. Capacity around DRG coding is also still being developed.Countries planning to introduce DRG systems should be aware of the challenges in moving too quickly to implement DRGs as the main hospital reimbursement mechanism.

Systematically evaluating the impact of diagnosis-related groups (DRGs) on health care delivery: A matrix of ethical implications

Swiss hospitals were required to implement a prospective payment system for reimbursement using a diagnosis-related groups (DRGs) classification system by the beginning of 2012. Reforms to a health care system should be assessed for their impact, including their impact on ethically relevant factors. Over a number of years and in a number of countries, questions have been raised in the literature about the ethical implications of the implementation of DRGs. However, despite this, researchers have not attempted to identify the major ethical issues associated with DRGs systematically. To address this gap in the literature, we have developed a matrix for identifying the ethical implications of the implementation of DRGs. It was developed using a literature review, and empirical studies on DRGs, as well as a review and analysis of existing ethics frameworks. The matrix consists of the ethically relevant parameters of health care systems on which DRGs are likely to have an impact; the ethical values underlying these parameters; and examples of specific research questions associated with DRGs to illustrate how the matrix can be applied. While the matrix has been developed in light of the Swiss health care reform, it could be used as a basis for identifying the ethical implications of DRG-based systems worldwide and for highlighting the ethical implications of other kinds of provider payment systems (PPS).

Analysis of the Existing Problems in the Coding of Disease and Operation in Homepage of the Medical Record

AbstractObjective. The implementation of diagnosis-related groups – prospective payment system (DRGs-PPS) and the work of classifying and coding disease play a very important role in the operation and management of a hospital. This paper aims to discover problems affecting the accuracy of coding, to improve accuracy of the disease and operation coding, and to improve the report quality, through the retrospective examination of the coding contents on the homepage of medical records. Methods. The Six Sigma method was used for randomly inspecting a part of the medical record data statistically reported by tertiary hospitals and secondary hospitals from the information center of the Beijing Municipal Health Bureau, and on-site inspection was performed, in order to find out reasons affecting the coding accuracy. Results. In the 695 medical records inspected, there were 258 cases having problems in the selection of the main diagnosis and the coding of the operation, accounting for 37% of the total. Conclusions....

Percepciones del personal hospitalario sobre la preparación institucional para la implementación de innovaciones en el sector salud, específicamente grupos relacionados con el diagnóstico (GRD)

Objetivos: Caracterizar el estado de la cultura innovadora y la actitud del personal hospitalario frente a los grupos relacionados de diagnóstico (GRD) como innovación para el sector de la salud en Colombia.Métodos: Estudio de caso mediante una muestra por conveniencia realizada entre el personal clínico y administrativo de quienes depende el éxito del proyecto de los GRD. El análisis estadístico se realiza por medio de la estadística descriptiva, la regresión y el análisis de correspondencia.Resultados: El estado de la cultura innovadora en el hospital es favorable para la innovación. No se observan diferencias significativas entre las perspectivas a la innovación que tienen el personal clínico y el administrativo. El personal administrativo y los médicos jóvenes desconocen los GRD. En cambio, los médicos con experiencia y los que ocupan puestos de mando, conocen los GRD. Se encontró una correlación significativa entre la cultura innovadora y la actitud frente a los GRD.Conclusiones: La homogeneidad de la cultura innovadora en el hospital augura un ambiente favorable para implementar los GRD.

Ethical research on the implementation of DRGs in Switzerland - a challenging project

Diagnosis Related Groups (DRGs) are currently being introduced on a national scale as a prospective reimbursement scheme in Swiss in-patient hospital care, replacing any remaining retrospective day-rate arrangements. DRGs are expected to promote transparency and efficiency while helping to contain health care costs. The governmental decision to introduce DRGs has caused considerable controversy among different stakeholders, due to diverging appraisals of what will happen when DRGs are introduced as an economic management tool in Switzerland. The controversial discourse on DRGs is particularly interesting from an ethical point of view, since all arguments inevitably contain ethical considerations. In this paper we summarise the results of our exploratory ethical studies that have led to a larger research project funded by the Swiss National Science Foundation: "Impact of Diagnosis-Related Groups (DRGs) on patient care and professional practice" (IDoC). In section 1: 'Developing an understanding of the ethical issues at stake' we briefly explain how DRGs work, what the intended effects are, what the public is concerned about and what the scientific research tells us so far. In section 2: 'Developing an ethical framework for research on DRGs in Switzerland' we summarise the ethical issues and explain the ethical framework we will use in order to perform research on the complex issue of DRGs in Switzerland. Only once a profound understanding of the challenges exists can research on the ethical implications of DRGs be successful.

The introduction of DRG funding and hospital nurses’ changing perceptions of their practice environment, quality of care and satisfaction: Comparison of cross-sectional surveys over a 10-year period

BackgroundAs other countries which have introduced diagnosis-related groups (DRGs) to pay their hospitals Germany initially expected that quality of care could deteriorate. Less discussed were potential implications for nurses, who might feel the efficiency-increasing effects of DRGs on their daily work, which in turn may lead to an actual worsening of care quality. ObjectiveTo analyze whether the DRG implementation in German acute hospitals (as well as other changes over the 10-year period) had measurable effects on (1) the nurse work environment (including e.g. an adequate number of nursing staff to provide quality patient care), (2) quality of patient care and safety (incl. confidence into patients’ ability to manage care when discharged), and (3) whether the effects from (1) and (2) – if any – impacted on the nurses themselves (satisfaction with their current job and their choice of profession as well as emotional exhaustion). Design and data sourcesTwo rounds of nurse surveys with the Practice Environment Scale of the Nursing Work Index (PES-NWI), five years before DRG implementation (i.e. in 1998/1999; n=2681 from 29 hospitals) and five years after (i.e. in 2009/2010; n=1511 from 49 hospitals). The analysis utilized 15 indicators as outcomes for (1) practice environment, (2) quality of patient care and safety, as well as (3) nurses’ satisfaction and emotional exhaustion. Multivariate analyses were performed for all three sets of outcomes using SPSS version 20. ResultsAspects of the practice environment (especially adequate staffing and supportive management) worsened within the examined time span of 10 years, which as a consequence had significant negative impact on the nurse-perceived quality of care (except for patient safety, which improved). Both the aspects of the practice environment and the quality aspects impacted substantially on satisfaction and emotional exhaustion among nurses. ConclusionsThe DRG implementation in Germany has apparently had measurable negative effects on nurses and nurse-perceived patient outcomes, however, not as distinct as often assumed.

Does increased health care spending afford better health care outcomes? Evidence from Austrian health care expenditure since the implementation of DRGs

While it is commonly accepted that health care costs have been rising to unprecedented levels, the question remains whether the increased expenditure actually affords increased health outcomes. It was the objective of this study to search for associations between health care spending and health care outcome, after adjusting for potential confounding variables, using aggregate data collected since the introduction of diagnosis-related groups (DRG) into Austrian health care financing in 1997. Two parameters of health care outcome, mortality and years of life lost (YLL), were regressed on direct and indirect measures of health care spending. We used ordinary least squares, Prais-Winsten, and 2-stage least squares regression in model building to account for autocorrelation and endogeneity. Our findings showed that health care spending was associated with mortality and YLL reduction. The strongest association among the independent variables was seen for spending for prevention. The strongest association for the dependent variables was seen for cardiovascular disease followed by injuries. Also, socio-economic status (SES) was shown to be an important confounder in all studied associations. Our data suggest that increases in health care spending produce significant increases in health. Health care spending should not be constrained, but instead an optimised resource allocation would afford an increase in health per expenditure. Emphasising spending in prevention and reduction of SES gradients would strengthen this association.