Current,Situation,and,Suggestions,on,the,Development,of,Diagnosis,Related,Group,(DRG),Policy,in,China

Dong Yujiao,Wang Shuling

(School of Business Administration,Shenyang Pharmaceutical University,Shenyang 110016,China)

Abstract Objective To implement the national diagnosis related group (DRG) policy smoothly,and gradually move towards value medicine and fine management,some suggestions are put forward for improving medical service efficiency,saving medical insurance fund,and reducing the burden of patients,so as to realize the win-win situation of medical insurance and patients.Methods Based on the experience of the United States,Australia,and Germany,the policy implementation background and development process in China were summarized.The advantages and disadvantages of single disease payment method,disease score payment method,and diagnosis related groups -prospective payment system (DRG-PPS) method were compared,and then the problems were found out.Results and Conclusion In view of the imperfect information system,lack of professional talents,and uneven progress of each pilot,it is proposed that relevant departments should pay more attention to the construction and improvement of coding and other information systems,cultivate professional talents,promote the reform of DRG payment technology specification and grouping technology combined with national pilot project,thus enhancing the application and in-depth development of DRG policy in China.

Keywords: diagnosis related group (DRG);DRG policy;DRG payment system

Since the founding of New China,China’s government has attached great importance to the construction of medical security system.During the period of planned economy,the public and labor insurance medical care system covering urban areas and the traditional cooperative medical care system covering rural areas were established.After the reform and opening-up,the economic system started the reform.With the increase of employees and the decrease of financial support,traditional medical security system began to reform,too.In 1992,the reform of the employee medical insurance system began.A medical insurance system for urban workers was established in 1998.In 2002,the government proposed to establish a new rural cooperative medical care system gradually.Since 2009,the national medical insurance system has been continuously improved.As its coverage has been expanded greatly,the goal of universal medical insurance will be gradually realized.With the wide coverage of medical insurance,as well as the large number of aging populations in China,the formulation and implementation of diagnosis related group (DRG)policy becomes necessary.Using DRG payment can solve the problems caused by the traditional charging model,such as excessive medical treatment,low medical efficiency,and overloading of medical insurance fund.In addition,DRG can also cope with the aging population,improve the fine management of hospitals,ensure the quality of medical care,reduce the waste of resources,control the cost of medical care,and avoid medical disputes[1].For these benefits,DRG payment has been used in more than 40 countries and become the first choice for health care payment reform in many countries around the world.

1.1 The definition of DRG

According to the definition given by the National Healthcare Security Administration,DRG is an important tool used to measure the quality and efficiency of medical services and to make medical insurance payment that is recognized as one of the more advanced payment methods in the world today.Case portfolio theory is used to improve the quality of medical services that can ensure the fine management of medical insurance and the effective performance of hospitals.In essence,DRG is a case mix classification scheme,namely,a system that classifies patients into several diagnostic groups for management according to factors such as age,disease diagnosis,complications,treatment methods,severity of disease,outcome and resource consumption.

1.2 Development of DRG in the United States

The United States is the first country to develop and apply the DRG payment system that plays a pioneering and leading role in the process of promoting the reform of the world medical insurance payment method.Therefore,DRG payment system in the United States has become an example for many countries to learn[2].To ensure the reasonable operation of DRG payment system,the United States has established special evaluation institutions and review institutions after several reforms.The government of the United States made several regulations and policies that required all hospitals to adopt the national unified data standards to build a unified information management platform,which takes regional geographical factors into full consideration,and scientifically determine the rate standards.This system can be of great inspiration to the development of DRG in China.

1.3 Development of DRG in Australia

DRG was introduced in Australia in 1988 to relieve pressure on government finances.In 1991,Australian National Health Classification Center was established,and DRG was introduced to measure the output of medical services and allocate health resources within and between hospitals,such as funds allocation,cost settlement,medical quality improvement,the comparison of medical quality,and time series analysis.After a series of revision and improvement,Australia launched the latest version of Australia refined-diagnosis related group（ARDRG) in 2015.At present,the Australian DRG system is internationally recognized as a relatively advanced system of hospital efficiency,quality control,and medical expense payment.Its successful experience can be used for reference from the construction of China’s DRG system,including the establishment of a standardized cost accounting system,and strengthening governmental support[3].

1.4 Development of DRG in Germany

Germany began to study the DRG system in 1984,drawing lessons from the DRGs system of the United States and Australia,and developed the German-diagnosis related group (G-DRG) system suitable for German application in November 2000.After that,the unified DRG coding was carried out nationwide,the DRG research center was established,and the cost calculation and pilot work were carried out.G-DRG system promotes cost management,and DRG payment system encourages hospitals to take the initiative to reduce costs for profit,pay more attention to cost efficiency in the procurement of drugs,equipment and equipment,the use of medical resources and the diagnosis and treatment process,and promote cost accounting to a certain extent[4].With the continuous development and improvement of G-DRG,the improvement of patient classification system,data collection and processing,the training of specialized DRG coding talents,the construction of medical expense review system and other aspects have given China great enlightenment[5].

With the development of economy,DRG policy was created and applied in the United States to control the unreasonable rise of medical cost and reduce unnecessary medical expenditure.Based on the effective implementation of DRG in the United States,more and more countries have introduced DRG,which has been widely used in the world.Due to the huge aging population,China also faces the same problem as that in the United States.To better deal with the relationship between medical institutions and insurance,China began to focus on the DRG after preliminary trial in the 1980s.

2.1 A review of the development of China’s DRG payment system

2.1.1 The first stage of preliminary trial

In the late 1960s,to facilitate hospital management and effectively evaluate hospital work,DRG were formally established in the United States.Since the end of 1980s,Chinese scholars have begun to pay attention to DRG and study the feasibility of implementing it in China.Therefore,China entered the preliminary trial period of DRG development.the first,a hospital management research institute was established in Beijing,which tracked the trend of foreign research,and jointly carried out large-scale research with 10 large hospitals in Beijing.At the same time,the early experts,including Huang Huiying,the first director of the Beijing Institute of Hospital Management,and Zhang Xiumei,also constantly published a series of papers on the feasibility of DRG in Beijing.The preliminary exploration in this stage has laid a foundation for the later research.

2.1.2 The second stage of rough exploration

In the second stages,due to the lack of electronic data for DRG grouping and analysis in China,largescale DRG studies did not occur in the following years.But the government and experts did not stop the exploration on the development of DRG.At the beginning of the 21st century,

Zhang Li,Cai Le and other experts carried out relevant studies on the combination of cases.After carrying out simulation and verification in Beijing,they finally developed the Beijing version of diagnosis related group (BJ-DRG) system with Chinese characteristics.Later,with the support of the policy,different DRG versions appeared in China,and DRG payment was initially carried out in the pilot cities.

2.1.3 The third stage of rapid development

After experiencing rough development,China gradually entered the fast lane of DRG development.During this period,China’s government officially launched the national pilot work of DRG payment,and 30 pilot cities were identified.Under the protection of relevant policies and close cooperation with all parties,China completed the top-level design of DRG payment pilot in 2019,which solved the problem of chaotic DRG version.Under the impetus of the national health insurance bureau,the pilot cities made the fine local DRG grouping scheme,deepening the reform of medical insurance payment.At the same time,through the communication meetings,they could understand the progress of the work and experience.Therefore,the pilot cities could speed up the related work deployment.Meanwhile,technical guidance and training were offered for the problems existing in the pilot process,which continued to promote the national pilot of DRG payment.At present,the pilot work of DRG payment in China is carried out according to the three-step strategy of top-level design,simulation test,and implementation[6].

2.2 A review of key events in the development of DRG payment system in China

China’s DRG payment system has experienced three periods: Preliminary trial,rough exploration,and rapid development.In these periods,there are some representative key events (Table 1).

Table 1 Development of DRG in China

2.3 Comparative analysis of the characteristics of DRG development stages

Since the introduction of DRG in China in the late 1980s,its exploration has gone through three periods:Preliminary trial period,rough exploration period,and the rapid development period.During the preliminary period,Chinese scholars and experts conducted exploratory studies on the feasibility of DRG in China,which gave the direction for future research on DRG.Since 2000,China has carried out many studies on DRG grouping and produced a series of DRG grouping versions.Meanwhile,pilot cities also carried out the DRG payment,which launched the rough exploration to find a DRG scheme suitable for China’s national conditions.After 2018,with the formulation and implementation of a series of policies,China’s DRG has achieved rapid development,which improved the pilot work of DRG.Through the formulation of CHS-DRG,the problem of the chaotic version was solved,and the top design of China’s DRG payment was completed.The three stages of development have different purposes,implementation methods,and difficulties.See Table 2 for specific contents.

Table 2 Comparison and analysis of DRG development characteristics

3.1 The purpose of DRG policy implementation

At present,to control the unreasonable rise of medical costs and reduce unnecessary medical expenditure,more and more countries around the world introduce DRG payment mode,and gradually move towards value-based medical care and fine management.The goal of DRG payment for medical insurance in China is to realize the win-win situation among hospitals,medical insurance and patients (Fig.1).Through DRG payment,the medical insurance fund is not overspent with great efficiency,and the management of medical institutions and patients is more accurate.Besides,medical treatment in hospitals is more standardized,medical expenses are compensated reasonably,and medical technology is fully developed.Patients enjoy high quality medical services with less economic burden,and the settlement method is more convenient.

Fig.1 A win-win situation among hospitals,medical insurance and patients

3.2 Reform of DRG payment method

The reform of DRGs payment mode in China,from payment by single disease to payment by disease score and then to DRG-PPS payment,reflects an important measure for medical insurance to move towards value-based medical treatment and fine management gradually.The reform of DRGs payment method is both an opportunity and a challenge for public hospitals.Only by making efforts to conduct reasonable diagnosis and treatment,standardize medical treatment,and optimize clinical management,can the structural reform of hospitals be promoted smoothly[7].

3.2.1 Pay by a single disease

Paying by a single disease means a fixed payment standard is set for each disease according to a unified diagnosis.Then,a fixed reimbursement standard is formulated for the disease by medical insurance company.To some extent,the method of paying by single disease is effective because it has improved the efficiency of hospitals.However,patients with many complications will naturally consume more medical resources,which leads to the subjective avoidance of doctors.Therefore,these patients can only get relatively inappropriate designated medical services,which is not conducive to the reasonable allocation of medical resources.On the other hand,in the face of the differences of patients and the complexity of diseases,doctors need to consider the limit of reimbursement standard of single diseases in the diagnosis and treatment,which discourages the creativity and enthusiasm of doctors.

3.2.2 Pay according to the disease score

To solve the problem of paying by single disease,Chinese government reformed this method and carried out paying by disease score.It means that in the basic medical insurance fund pays the total budget of hospitalization medical expenses,in the whole area and to different diseases are given different scores.Hospitalization expense is settled in accordance with the contract.Its advantage lies in raising doctor’s medical cost consciousness,so the doctor can make reasonable diagnosis and treatment according to the standard,which avoids the excessive medical costs.However,there are also many shortcomings to be solved,such as the risk of insufficient treatment for patients,avoiding severe illness.Normally,severe patients have more basic diseases that lead to the large medical cost.Since the disease with low score will cause a loss to the hospital,doctors may try to base their diagnoses on categories with high scores.Health care providers may break up hospitalization to earn more profits,and some even require patients to complete preoperative examinations in the outpatient department to reduce the total cost.Besides,the requirement for medical record information is high.Complications and age factors are not considered by doctors[8].Therefore,it has many limitations.

3.2.3 Prepaid diagnosis related group -prospective payment system (DRG-PPS) by disease group

With the deepening of medical reform,the DRGPPS has been implemented.Each case enters different diagnosis-related groups based on the diagnosis,treatment,and patients’ different characteristics.Medical insurance company pays according to the budget standard,weight,and rate.At present,China’s disease diagnosis-related groups have numerous versions,and there are four main versions such as BJ-DRG,CN-DRG,C-DRG,and CR-DRG.BJDRG is commissioned by Beijing Medical Insurance Association and developed by Peking University.CN-DRG is jointly developed by the National Health Commission of the People’s Republic of China and the Information Center of the Beijing Municipal Health Commission.C-DRG is led by the Health Development Research Center of the National Health Commission of the People’s Republic of China.CRDRG is formulated by the Primary Health Department of the National Health Commission of the People’s Republic of China,and is mainly aimed at prefecturelevel and county-level hospitals.The focus of the four versions is also different,which makes it impossible to reach agreement on the top level.Therefore,it results in the difficulty of national practice operation.The National Healthcare Security Administration issued the “Notice on the Issuance of Technical Specifications and Grouping Schemes for the National Pilot Program of Diagnosis Related Group (DRG) Payment”.Besides,it officially published two technical standards,the “Technical Specifications for the Group and Payment of National Medical Security DRG” and the“CHS-DRG Group Schemes for the National Medical Security DRG”.The formulation of CHS-DRG solved the problem of the chaotic version of DRG in China and completed the top-level design of national pilot of DRG payment in China.At the same time,compared with other payment methods,DRG-PPS takes the complications and other conditions of patients into account.So it has high adaptability.In short,the application of DRG for medical insurance payment is an important measure towards value-based medical care and fine management,which can help realize the modernization of medical insurance management[8].

3.3 Comparative analysis of DRG policy payment methods

2019 is the first year of China’s DRG reform for medical insurance.To further promote the reform of DRG payment,it is necessary to realize that China’s medical exploration have gone through three stages:The initial version of single-disease payment,the middle version of disease payment by score,and the advanced version of DRG-PPS payment[9].The changes of the payment also reflect the standardized diagnosis and treatment,the more accurate medical insurance management,and the better solution of patients’ problems in medical service and economic burden (Table 3).

Table 3 Comparison of three payment methods

4.1 Imperfection of information system

At present,the management of medical records in various provinces of China is not unified,and the data of the first page of medical records cannot be effectively verified and supervised.The content of the information system is not consistent with the first page of medical records,which results in the error of the information system and the difficulty in the follow-up.At the same time,the personal information in the patient’s medical record,the basic information of the patient’s hospitalization and treatment,including the hospitalization number and the medical insurance registration number,as well as the relevant information of the medical insurance settlement should be further improved by the medical insuranceand medical institutions.In addition,in the process of information system docking and bidding,there are some obstacles for collecting some basic data.

4.2 Lack of professional talents

At present,problems such as incorrect coding for some diseases can affect the correctness of data.Errors in hospital codes will affect the inclusion of DRG and the performance appraisal of hospitals.In terms of coding the number of professionals in hospitals are insufficient.As to medical insurance,the professional ability of medical personnel cannot meet the requirements of the pilot work.

4.3 Different progress of the pilot

The 30 pilot cities selected by the government are representative in terms of geographical location,administrative level,and development level.According to the monitoring and evaluation report of the Medical Insurance Research Institute,the schedule of the current pilot cities can be divided into the following four types: Cities with lagging progress,cities entering the stage of simulation operation,cities carrying out DRG payment,and cities not entering the simulation operation.Therefore,the progress of each pilot city is different.Besides,there are problems of unbalanced development in medical service system and the allocation of health resources.

5.1 Accelerating the standardization and accuracy of informationization

Hospitals and medical insurance departments should actively construct and perfect information system.The electronic medical record information system should be improved to solve the problems of the traditional paper files.So,it can realize the automatic acquisition of data from the input of doctors.Meanwhile,the error in the data should be automatically retrieved to ensure the standardization and accuracy of the information.Good measures should be applied to strengthen the verification and supervision of the data on the first page of medical records,thus ensuring the standardization and accuracy of the data[10].In addition,the regulatory authorities should check the relevant information regularly.

5.2 Cultivating professional talents with disease coding skills

Medical staff in the hospital should follow the law of medical development and provide patients with correct and reasonable diagnosis and treatment services.To strengthen the awareness of medical staffon the importance of coding,professional talents with disease coding should be actively introduced.Besides,error feedback system should be established to make timely adjustments.The fine management of hospitals must be enhanced to mold professional talents.In addition,the training of medical insurance department personnel should be strengthened to ensure the speed of medical reform in pilot cities.

5.3 Making the progress of DRG policy steadily

A localized DRG classification and coding system should be built.To further reduce the difficulties caused by the different progress of pilot cities,corresponding arrangements should be made according to the actual situation of the progress of local DRG policy.Cities without carrying out the DRG payment should make full preparations to speed up the pilot.Cities that have entered the simulation operation stage should make feedback and adjustment in time.Cities carrying out the payment should transform from the local version to the national version.Cities that have the conditions but have not entered the simulation operation should start the pilot as soon as possible.At the same time,we should also give play to the important role of the DRG national pilot steering group in the formulation of technical standards,monitoring and evaluation.

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