• Quality Improvement in Health Care
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• v.27 no.2
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• pp.30-44
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• 2021

Purpose: The aim of this study was to investigate the changes in perception of the New Diagnosis-Related Group (DRG)-based payment system, make overall evaluation after participation, and examine opinions on further policy improvement among employees of a public hospital participating in the pilot project in Korea. Methods: We investigated changes in perception of the New DRG-based payment system before and after participation in the pilot project using a qualitative research method. We conducted individual in-depth interviews with the management and healthcare professionals and Focus Group Interviews (FGIs) with the staff in the nursing and administrative departments. Results: Before implementing the pilot project of the New DRG-based payment system, the management was in favor of participating in the pilot project, whereas the healthcare professionals were strongly opposed to participation in the pilot project, and the staff in the nursing and administrative departments were slightly opposed to participation. After implementing the pilot project, there were remarkable changes in the perception of the New DRG-based payment system among healthcare professionals and the administrative staff. Healthcare professionals' perception was altered in a positive way, while the administrative staff's perception of the system became negative. Conclusion: There were no restrictions on clinical practice or deterioration of quality of care observed in association with the participation in the New DRG-based payment system. However, certain unintended consequences of the New DRG-based payment system may arise as well. Therefore, the government needs to examine the problems identified in this study to reflect on and improve the New DRG-based payment system for stable expansion.

• Korea Journal of Hospital Management
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• v.25 no.2
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• pp.45-56
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• 2020

Purpose: The purpose of this study is to investigate medical care behaviors influencing accuracy of the payment based New diagnosis-related groups (DRG) compared to fee for service (FFS) in hospitalized patients with medical illness. Methodology: In order to estimate the difference in medical costs between New DRG and FFS depending on medical care behaviors, medical records and hospital claims data (n=4,232) were utilized, which were collected from a single public hospital during the first-half of 2018. Data were analyzed by descriptive statistics, t-test, chi-square test, and multivariate binary logistic regression. Findings: The average difference in medical costs between New DRG and FFS were KRW 506,711±13,945 with incentives and KRW -51,506±12,979 without incentives, respectively. Forty-four point two percent (44.2%, n=1,872) of total subjects were shown to have negative compensation in overall medical costs with New DRG compared to the costs with FFS. Medical care behaviors that affected on the negative compensation were the presence of severe bed sores on admission, medical consultations, death, operations, medications and laboratory or imaging tests with unit price over KRW 100,000, hospital-acquired complications or underlying comorbidities, elderly patients (≧65 years), and hospitalized for more than average inpatient days defined by New DRG (p<0.001). The difference in average medical cost between New DRG and FFS for a group with mild illness was KRW -11,900±10,544, whereas it was KRW -196,800±46,364 for a group with severe illness (p<0.0001). Practical Implications: These findings suggest that New DRG payment model without incentives may incompletely cover the variation of medical costs in real clinical practice. Therefore, policy makers need to consider that the current New DRG reimbursement should be focused and refined to improve accuracy of payment on medical care resources utilized in severe and complex medical conditions.

• Health Policy and Management
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• v.31 no.2
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• pp.180-187
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• 2021

Background: This study analyzed the effect of applying the diagnosis-related group (DRG)-based payment system, which was implemented in July 2012 for hospitals and clinics nationwide, on the cesarean section rate. Methods: The subjects of the study were divided into new groups that participated in the payment system after July 2012 and maintenance groups that participated in the payment system before July 2012. As an analysis method, a difference-in-difference analysis, which is a quasi-experimental design, was used. The risk-adjusted cesarean section rate was used as a dependent variable. Results: Seven risk factors (malpresentation of fetus, eclampsia, multiple pregnancies, problems in the placenta, previous Cesarean section, cephalopelvic disproportion, problems in amniotic fluid) were included in the final risk-adjustment model, and found to have a statistically significant relationship with the cesarean section rate. Results showed that the risk-adjusted cesarean section rate increased significantly in new groups after the application of the DRG-based payment system. Conclusion: Study results provided policy implications for the reorganization of the DRG-based system should that reflects the demands of obstetricians, such as organizing a consultative body with obstetricians and establishing a reasonable fee.

• Health Policy and Management
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• v.27 no.3
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• pp.211-218
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• 2017

Background: Korea set up new diagnosis related group (DRG) as demonstration project in 2009. The new DRG was reformed in 2016. The main purpose of study is to identify the effect of reform on accuracy of payment. Methods: This study collected inpatient data from a hospital which contains medical information and cost from 2015 to 2016. The dependent variables were accuracy of total, bundled, unbundled payment, and payment for procedures. To analyze the effect of reform, this study conducted a multi-variate regression analysis adjusting for confounding variables. Results: The accuracy of payment increased after policy reform. The accuracy of total, bundled, unbundled payment, and payment for procedures significantly increased 3.90%, 2.92%, 9.03%, and 14.57% after policy reform, respectively. The accuracy of unbundled payment showed the largest increase among dependent variables. Conclusion: The results of study imply that policy reform enhanced the accuracy of payment. The government needs to monitor side effects such as increase of non-covered services. Also, leads to a considerable improvement in the value of cost unit accounting as a strategic play a role in development of DRG.

• Health Policy and Management
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• v.26 no.2
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• pp.135-147
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• 2016

Background: The voluntary diagnosis-related groups (DRG)-based payment system was introduced in 2002 and the government mandated participation in the DRG for all hospitals from July 2013. The main purpose of this study is to examine the independent effect of mandatory participation in DRG on various outcomes of patients. Methods: This study collected 1,809,948 inpatient DRG data from the Health Insurance Review and Assessment database which contains medical information for all patients for the period 2007 to 2014 and examined patient outcomes such as length of stay (LOS), total medical cost, spillover, and readmission rate according to hospital size. Results: LOS of patients decreased after DRGs (large hospitals: adjusted odds ratio [aOR], 0.87; 95% confidence interval [CI], 0.78-0.97; small hospitals: aOR, 0.91; 95% CI, 0.91-0.92). The total medical cost of patients increased after DRGs (large hospitals: aOR, 1.22; 95% CI, 1.14-1.30; small hospitals: aOR, 1.22; 95% CI, 1.21-1.23). The results reveals that spillover of patients increased after DRGs (large hospitals: aOR, 1.27; 95% CI, 0.70-2.33; small hospitals: aOR, 1.18; 95% CI, 1.16-1.20). Finally, we found that readmission rates of patients decreased significantly after DRGs (large hospitals: aOR, 0.28; 95% CI, 0.26-0.29; small hospitals: aOR, 0.59; 95% CI, 0.56-0.63). Conclusion: The DRG payment system compared to fee-for-service payment in South Korea may be an alternative medical price policy which can reduce the LOS. However, government need to monitor inappropriate changes such as spillover increase. Since this study also is the results based on relatively simple surgery, insurer needs to compare or review bundled payment like new DRG for expansion of various inpatient-related diseases including internal medicine.

• Health Policy and Management
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• v.14 no.1
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• pp.121-147
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• 2004

Since the pilot program for a DRG-based prospective payment system was introduced in 1997, the performance of KDRGs has been one of hotly debated issues. The objectives of this study are to refine the classification algorithm of the KDRGs and to assess the improvement achieved by the refinement. The U.S. Medicare DRGs version 17.0 and the Australian Refined DRGs version 4.1 were reviewed to identify areas of possible impro-vement. Refined changes in the classification and result of date analyses were submitted to a panel of 48 physicians for their reviews and suggestions. The refinement was evaluated by the variance reduction in resource utilization achieved by the KDRG The database of 2,182,168 claims submitted to the Health Insurance Review Agency during 2002 was used for evaluation. As the result of the refinement, three new MDCs were introduced and the number of ADEGs increased from 332 to 674. Various age splits and two to four levels of severity classification for secondary diagnoses were introduced as well. A total of 1,817 groups were defined in the refined KDRGs. The variance reduction for charges of all patients increased from 48.2％ to 53.6％ by the refinement, and from 65.6％ to 73.1％ for non-outlier patients. The r-square for length of stays of all patients was increased from 28.3％ to 32.6％, and from 40.4％ to 44.9％ for non-outlier patients. These results indicated a significant improvement in the classification accuracy of the KDRG system.

• The Korean Society of Law and Medicine
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• v.13 no.2
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• pp.11-38
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• 2012

The Supreme Court stand in the position in specific lawsuit that it doesn't allow the discretionary not covered service, but recently in revocation suit of fine disposal that is imposed on medical fee of leukemia patient, it altered the existing adjudgement and admitted the discretionary not covered service exceptionally. It put forward the allowable condition roughly in that case. According as this alteration, it has become more important to embody the allowance conditions of exceptions. The Supreme Court presented three things, which are procedural condition, medical condition and subscriber's agreement. Concerning procedural condition, several present conciliation procedures are as follows: medical care benefit arret request, relative value conciliation etc, prior request on anti-cancer drug among chemicals which exceed acceptance criteria, request of non benefit object on common drugs. To be granted the existence of those system, there should be no obstacle to use that. Even if it were so, we should take circumstances into consideration; individual situation is unescapable concerning substance and urgency of the discretionary not covered service, process of the procedure, time required etc. Regarding medical condition, safety and effectiveness will be verified through evaluation procedures of new medical skill. About the necessity, the Supreme Court made clear through a sentence that it allow the discretionary not covered service, in case that needs to treat a patient out of the standard of medical benefit. Strict interpretation is right and it answer the purpose of the sentence that the supreme court permit the discretionary not covered service, exceptionally. We need to differentiate medical necessity and medical validity. Subscriber's agreement should holds true if it entails full explanation, and if it is preliminary, explicit and individual. On this account, it should be difficult to admit that someone agree effectively when he call for the affirmation that he is recipient of medical care. Reasonable expense needs to be a part of review whether the agreement is valid. Meanwhile If we adjust system of medical expense and eventually reorganize a fee for consultation payment system (Fee-for-service controlled by item to DRG (Diagnosis Related Groups)), controversial area of the discretionary not covered service will be decreased and that will guarantee the discretion of the doctor.