Identification and assessment of a comprehensive set of structural factors associated with hospital costs in Switzerland.

Structural factors can influence hospital costs beyond case-mix differences. However, accepted measures on how to distinguish hospitals with regard to cost-related organizational and regional differences are lacking in Switzerland. Therefore, the objective of this study was to identify and assess a comprehensive set of hospital attributes in relation to average case-mix adjusted costs of hospitals. Using detailed hospital and patient-level data enriched with regional information, we derived a list of 23 cost predictors, examined how they are associated with costs, each other, and with different hospital types, and identified principal components within them. Our results showed that attributes describing size, complexity, and teaching-intensity of hospitals (number of beds, discharges, departments, and rate of residents) were positively related to costs and showed the largest values in university (i.e., academic teaching) and central general hospitals. Attributes related to rarity and financial risk of patient mix (ratio of rare DRGs, ratio of children, and expected loss potential based on DRG mix) were positively associated with costs and showed the largest values in children's and university hospitals. Attributes characterizing the provision of essential healthcare functions in the service area (ratio of emergency/ ambulance admissions, admissions during weekends/ nights, and admissions from nursing homes) were positively related to costs and showed the largest values in central and regional general hospitals. Regional attributes describing the location of hospitals in large agglomerations (in contrast to smaller agglomerations and rural areas) were positively associated with costs and showed the largest values in university hospitals. Furthermore, the four principal components identified within the hospital attributes fully explained the observed cost variations across different hospital types. These uncovered relationships may serve as a foundation for objectifying discussions about cost-related heterogeneity in Swiss hospitals and support policymakers to include structural characteristics into cost benchmarking and hospital reimbursement.

The economic cost of not coding disease-related malnutrition: A study in cancer inpatients.

BACKGROUND & AIMS: Disease-related malnutrition (DRM) coding rate is usually low in hospitalised patients. The objective of our study was to estimate the percentage of correct DRM coding in cancer inpatients and to calculate the economic losses caused by such lack of coding. METHODS: This was an observational, prospective study that was conducted in patients hospitalised in the Medical Oncology Unit of our hospital. A nutritional assessment was performed through subjective global assessment (SGA). The all patient refined-diagnosis related group (APR-DRG) weights were obtained at the moment of discharge; moreover, recalculation was done after including the diagnosis of malnutrition in the medical record of those patients in whom it had not been initially coded. The associated cost reimbursement were calculated based on the weight before and after revising the diagnosis of DRM. RESULTS: A total of 266 patients were evaluated. From them, 220 (82.7%) suffered from DRM according to the SGA. In 137 (51.5%) of these patients, diagnosis was coded, as opposed to 83 (31.2%) cases (33 subjects with moderate and 50 with severe DRM) in whom it was not coded. The sum of the APR-DRG weights before revising the diagnosis of malnutrition was 343.4 points (mean: 1.29 ± 0.89). Whereas, after revising the diagnosis, it increased up to 384.3 (1.44 ± 0.96). The total cost reimbursement for the hospital before revising the diagnosis of malnutrition was 1,607,861.21€ and after revision it increased up to 1,799,199.69€, which means that 191,338.48€ were not reimbursed to the hospital due to the lack of coding of malnutrition. The cost reimbursement for each admission increased an average of 719.32€. CONCLUSION: The prevalence of DRM in cancer inpatients is high. Nevertheless, the diagnosis is not coded in one third of patients, which results in important economic losses for the hospitals.

Lessons learned from value-based pediatric appendectomy care: A shared savings pilot model.

PURPOSE: We aim to assess the healthcare value achieved from a shared savings program for pediatric appendectomy. METHODS: All appendectomy patients covered by our health plan were included. Quality targets were 15% reduction in time to surgery, length of stay, readmission rate, and patient satisfaction. Quality targets and costs for an appendectomy episode in two 6-month performance periods (PP1, PP2) were compared to baseline. RESULTS: 640 patients were included (baseline:317, PP1:167, PP2:156). No quality targets were met in PP1. Two quality targets were met during PP2: readmission rate (-57%) and patient satisfaction. No savings were realized because the cost reduction threshold (-9%) was not met during PP1 (+1.7%) or PP2 (-0.4%). CONCLUSIONS: Payer-provider partnerships can be a platform for testing value-based reimbursement models. Setting achievable targets, identifying affectable quality metrics, considering case mix index, and allowing sufficient time for interventions to generate cost savings should be considered in future programs.

Savings and outcomes under Medicare's bundled payments initiative for skilled nursing facilities.

BACKGROUND: Model 3 of Medicare's Bundled Payments for Care Improvement (BPCI) was a voluntary alternative payment model that held participating skilled nursing facilities (SNFs) accountable for 90-day costs of care. Its overall impact on Medicare spending and clinical outcomes is unknown. METHODS: Retrospective cohort study using Medicare claims from 2012 to 2017. We used an interrupted time-series design to compare participating vs matched control SNFs on total 90-day Medicare payments and payment components (initial SNF stay, readmissions, and outpatient/clinician), case mix (volume, proportion Medicaid, proportion black, number of comorbidities), and clinical outcomes (90-day readmission, mortality and healthy days at home, and length of initial SNF stay), overall and among key subgroups with frailty or dementia, for 47 of the 48 conditions in the program (excluding major lower extremity joint replacement). RESULTS: Our sample included 1001 participating and 3873 matched control SNFs. At baseline, total Medicare institutional payments were increasing at BPCI SNFs at a rate of $121 per episode per quarter; during the intervention period, payments decreased at a rate of -$398/episode/quarter. Among controls, payments were stable in the baseline period (+$17/episode/quarter) but decreased at -$424/episode/quarter during the intervention period, yielding a nonsignificant difference in slope changes of -$79/episode/quarter (95% confidence interval [CI] -$188, $31, p = 0.16). However, among patients with frailty, spending declined by $620/episode/quarter in the BPCI group, compared with $330/episode/quarter in the non-BPCI group, for a difference in slope changes of -$289 (95% CI -$482, -$96, p = 0.003). There were no differences in the change in slopes in case selection or clinical outcomes overall or in any clinical subgroup. CONCLUSIONS: SNF participation in BPCI was associated with no overall differential change in total Medicare payments per episode, case selection, or clinical outcomes. Exploratory analyses revealed a decrease in Medicare payments in patients with frailty that may warrant further study.

Hospitals' Diversity of Diagnosis Groups and Associated Costs of Care.

BACKGROUND AND OBJECTIVES: Hospitals treating patients with greater diagnosis diversity may have higher fixed and overhead costs. We assessed the relationship between hospitals' diagnosis diversity and cost per hospitalization for children. METHODS: Retrospective analysis of 1 654 869 all-condition hospitalizations for children ages 0 to 21 years from 2816 hospitals in the Kids' Inpatient Database 2016. Mean hospital cost per hospitalization, Winsorized and log-transformed, was assessed for freestanding children's hospitals (FCHs), nonfreestanding children's hospitals (NFCHs), and nonchildren's hospitals (NCHs). Hospital diagnosis diversity index (HDDI) was calculated by using the D-measure of diversity in Shannon-Wiener entropy index from 1254 diagnosis and severity-of-illness groups distinguished with 3M Health's All Patient Refined Diagnosis Related Groups. Log-normal multivariable models were derived to regress hospital type on cost per hospitalization, adjusting for hospital-level HDDI in addition to patient-level demographic (eg, age, race and ethnicity) and clinical (eg, chronic conditions) characteristics and hospital teaching status. RESULTS: Admission counts were 383 789 (23.2%) in FCHs, 588 463 (35.6%) in NFCHs, and 682 617 (41.2%) in NCHs. Unadjusted mean cost per hospitalization was $10 757 (95% confidence interval [CI]: $9451 to $12 243) in FCHs, $6264 (95% CI: $5830 to $6729) in NFCHs, and $4192 (95% CI: $4121 to $4265) in NCHs. HDDI was significantly (P < .001) higher in FCHs and NFCHs (median 9.2 and 6.4 times higher, respectively) than NCHs. Across all hospitals, greater HDDI was associated (P = .002) with increased cost. Adjusting for HDDI resulted in a nonsignificant (P = .1) difference in cost across hospital types. CONCLUSIONS: Greater diagnosis diversity was associated with increased cost per hospitalization and should be considered when assessing associated costs of inpatient care for pediatric patients.

Principal-agent theory-based cost and reimbursement structures of isavuconazole treatment in German hospitals.

BACKGROUND: Isavuconazole (ISA) is a frequently used antifungal agent for the treatment of invasive fungal diseases (IFDs). However, hospital reimbursement data for ISA is limited. OBJECTIVES: The primary objective of this study was to analyse the different perspectives of relevant stakeholders and the (dis)incentives for the administration of ISA in Germany. To that aim, the health economic effects of using ISA from a hospital management perspective were analysed. PATIENTS/METHODS: Based on principal-agent theory (PAT), the perspectives of (a) the patient (principal) as well as (b) physicians, (c) pharmacists and iv. hospital managers (all agents) were analysed. For the evaluation of the cost-containment and reimbursement strategies of ISA, the German diagnosis-related group (G-DRG) system was used. RESULTS: Hospitals individually negotiating additional payments for innovative treatment procedures (zusatzentgelte [ZE]) within the G-DRG system is a key element of hospital management for the reduction of total healthcare expenditure. Our analysis demonstrated the beneficial role of ISA in healthcare resource utilisation, primarily due to a shortened overall length of hospital stay. Depending on underlying disease, coded G-DRG and ISA formulation, large differences in total reimbursement and the amount of ZE was shown. The PAT demonstrated disincentives for hospital managers to use innovative drugs. CONCLUSIONS: Based on the PAT, beneficial, detrimental and indifferent perspectives of different stakeholders regarding the usage of ISA were shown. A reduction of bureaucratic hurdles is needed in Germany for the extension of effective and innovative antifungal treatment strategies with ISA.

Tracheotomy Timing and Outcomes in the Critically Ill: Complexity and Opportunities for Progress.

OBJECTIVES/HYPOTHESIS: To characterize the effects of tracheotomy timing at our institution on intensive care unit (ICU) length of stay (LOS) and overall hospital LOS. STUDY DESIGN: Retrospective cohort study. METHODS: A retrospective study was performed at a tertiary care medical center for patients undergoing tracheotomy over 2.5 years from January 1, 2016 through June 30, 2018. Demographics, survival, duration of endotracheal intubation, timing of tracheotomy, and ICU and overall hospital LOS were assessed. Tracheotomy was considered early (ET) if it was performed by day 7 of mechanical ventilation and late (LT) thereafter. Readmission, mortality, and costs were also tabulated for each aggregate group. Nonparametric statistics were used to compare results. RESULTS: Of the 536 patients included in the analysis, 160 received tracheotomy early and 376 late. Differences between age and sex were not statistically significant. Duration of total ICU stay was shortened by 65% (12.84 ± 17.69 days vs. 38.49 ± 26.61 days; P < .0001), and length of overall hospital course was reduced by 54% (22.71 ± 26.65 days vs. 50.37 ± 34.20 days; P < .0001) in the early tracheotomy group. Observed/expected (O/E) values standardized results to case mix index and revealed LOS of 1.5 for ET and 2.5 for LT, and mortality of 0.76 for ET and 1.25 for LT, and comparable readmissions of both groups. CONCLUSIONS: Early tracheotomy in ICU patients is associated with earlier ICU discharge, decreased length of overall hospital stay, and lower mortality when controlling for case mix index. Opportunities exist to optimize patient outcomes and O/E performance. LEVEL OF EVIDENCE: 4 Laryngoscope, 131:282-287, 2021.

Financial viability of endovascular aortic repair in the modern era.

BACKGROUND: In the current era of cost containment, the financial impact of high-cost procedures such as endovascular aneurysm repair (EVAR) remains an area of intensive interest. Previous reports suggested slim to negative operating margins with EVAR, prompting widespread initiatives to reduce cost and to improve reimbursement. In 2015, the Centers for Medicare and Medicaid Services (CMS) announced the reclassification of EVAR to more specific diagnosis-related group (DRG) coding and predicted an overall increase in hospital reimbursement. The potential impact of this change has not been described. METHODS: Patients undergoing elective EVAR at a single institution between January 2014 and December 2018 were identified retrospectively, then stratified by date. Group 1 patients underwent EVAR before DRG change in 2015 and were classified with DRG 237/238, major cardiovascular procedure. Group 2 patients underwent EVAR after the change and were classified as DRG 268/269, aortic/heart assist procedures. The total direct cost included implant cost, operating room (OR) labor, room and board, and other supply costs. Net revenue reflected real payer mix values without extrapolation based on standard Medicare rates. Hospital profit was defined as the contribution to indirect (CTI), subtracting total direct cost from net revenue. RESULTS: A total of 188 encounters were included, 67 (36%) in group 1 and 121 (64%) in group 2. Medicare patients composed 84% of group 1 and 81% of group 2. CTI (profit) increased by $4447 (+123%) from $3615 in group 1 to $8062 in group 2. Net revenue per encounter increased by $2054 (+7.1%). In group 1, the higher reimbursement DRG code 237 was applied in 5 of 67 (7.5%) patients, whereas DRG code 268 was assigned in 19 of 121 (15.1%) patients in group 2. Total direct cost per encounter decreased by $2012 (-7.9%). This decrease in cost was driven by a reduction in implant cost, from a mean $16,914 per encounter in group 1 to a mean $15,655 in group 2 (-$1259 or -7.4% per encounter) and by a decrease in OR labor cost, $2838 in group 1 to $2361 in group 2 (-$477 or -17.0% per encounter). CONCLUSIONS: A significant improvement in hospital CTI was observed for elective EVAR during the course of the study. The increased DRG reimbursement after the Centers for Medicare and Medicaid Services coding changes in 2015 was a major driver of this salutary change. Notably, efforts to reduce implant and OR cost as well as to improve coding and documentation accuracy over time had an equally important impact on financial return.

From downcoding to upcoding: DRG based payment in hospitals.

A prospective disease group-based payment is a reimbursement rule used in a wide array of countries. It turns to be the hospital's payment rule to imply. The secret of this payment is a fee payment as well as a hospital's activity based payment. There is a consensus to consider this rule of payment as the least likely to be manipulated by the actors. However, the defined fee per group depends on recorded information that is then processed using complex algorithms. What if the data itself can be manipulated? The result would be a fee per group based on manipulated factors that would lead to an inefficient budget allocation between hospitals. Using a unique French longitudinal database with 145 million stays, I unambiguously demonstrate that the implementation of a finer classification led to an upcoding-learning effect. The end result has been a budget transfer from public non-research hospitals to for-profit hospitals. The 2009 policy lead to upcoding disconnected from any changes in the trend of production of care.

Trends in Diagnosis Related Groups for Inpatient Admissions and Associated Changes in Payment From 2012 to 2016.

Importance: Hospitals are reimbursed based on Diagnosis Related Groups (DRGs), which are defined, in part, by patients having 1 or more complications or comorbidities within a given DRG family. Hospitals have made substantial investment in efforts to document these complications and comorbidities. Objective: To examine temporal trends in DRGs with a major complication or comorbidity, compare these findings with 2 alternative measures of disease severity, and estimate associated changes in payment. Design, Setting, and Participants: This retrospective cohort study used data from the all-payer National Inpatient Sample for admissions assigned to 1 of the top 20 reimbursed DRG families at US acute care hospitals from January 1, 2012, to December 31, 2016. Data were analyzed from July 10, 2018, to May 29, 2019. Exposures: Quarter year of hospitalization. Main Outcomes and Measures: The primary outcome was the proportion of DRGs with a major complication or comorbidity. Secondary outcomes were comorbidity scores, risk-adjusted mortality rates, and estimated payment. Changes in assigned DRGs, comorbidity scores, and risk-adjusted mortality rates were analyzed by linear regression. Payment changes were estimated for each DRG by calculating the Centers for Medicare & Medicaid Services weighted payment using 2012 and 2016 case mix and hospitalization counts. Results: Between 2012 and 2016, there were 62 167 976 hospitalizations for the 20 highest-reimbursed DRG families; the sample was 32.9% male and 66.8% White, with a median age of 57 years (interquartile range, 31-73 years). Within 15 of these DRG families (75%), the proportion of DRGs with a major complication or comorbidity increased significantly over time. Over the same period, comorbidity scores were largely stable, with a decrease in 6 DRG families (30%), no change in 10 (50%), and an increase in 4 (20%). Among 19 DRG families with a calculable mortality rate, the risk-adjusted mortality rate significantly decreased in 8 (42%), did not change in 9 (47%), and increased in 2 (11%). The observed DRG shifts were associated with at least $1.2 billion in increased payment. Conclusions and Relevance: In this cohort study, between 2012 and 2016, the proportion of admissions assigned to a DRG with major complication or comorbidity increased for 15 of the top 20 reimbursed DRG families. This change was not accompanied by commensurate increases in disease severity but was associated with increased payment.

Characteristics and related factors of emergency department visits, readmission, and hospital transfers of inpatients under a DRG-based payment system: A nationwide cohort study.

OBJECTIVES: Taiwan has implemented the Diagnosis Related Groups (DRGs) since 2010, and the quality of care under the DRG-Based Payment System is concerned. This study aimed to examine the characteristics, related factors, and time distribution of emergency department (ED) visits, readmission, and hospital transfers of inpatients under the DRG-Based Payment System for each Major Diagnostic Category (MDC). METHODS: We conducted a retrospective cohort study using data from the National Health Insurance Research Database (NHIRD) from 2012 to 2013 in Taiwan. Multilevel logistic regression analysis was used to examine the factors related to ED visits, readmissions, and hospital transfers of patients under the DRG-Based Payment System. RESULTS: In this study, 103,779 inpatients were under the DRG-Based Payment System. Among these inpatients, 4.66% visited the ED within 14 days after their discharge. The factors associated with the increased risk of ED visits within 14 days included age, lower monthly salary, urbanization of residence area, comorbidity index, MDCs, and hospital ownership (p < 0.05). In terms of MDCs, Diseases and Disorders of the Kidney and Urinary Tract (MDC11) conferred the highest risk of ED visits within 14 days (OR = 4.95, 95% CI: 2.69-9.10). Of the inpatients, 6.97% were readmitted within 30 days. The factors associated with the increased risk of readmission included gender, age, lower monthly salary, comorbidity index, MDCs, and hospital ownership (p < 0.05). In terms of MDCs, the inpatients with Pregnancy, Childbirth and the Puerperium (MDC14) had the highest risk of readmission within 30 days (OR = 20.43, 95% CI: 13.32-31.34). Among the inpatients readmitted within 30 days, 75.05% of them were readmitted within 14 days. Only 0.16% of the inpatients were transferred to other hospitals. CONCLUSION: The study shows a significant correlation between Major Diagnostic Categories in surgery and ED visits, readmission, and hospital transfers. The results suggested that the main reasons for the high risk may need further investigation for MDCs in ED visits, readmissions, and hospital transfers.

DRG-Oriented Mathematical Calculation Model and Method of Integrated Medical Service Cost.

In the context of the new round of medical and health reform, in order to alleviate the problem of "difficult to see a doctor and expensive to see a doctor," the state focuses on reducing the cost of medical services, so it puts forward the calculation and method research of medical costs. The purpose of this study is to calculate and predict the cost of medical services in a DRG-oriented integrated environment. In this study, activity-based costing and weighted moving average methods are used. First, basic data of medical services are collected, then all medical activities are confirmed and all service costs are collected, then a cost database is established, and a calculation model of medical costs is designed. Finally, calculation suggestions and optimization methods are put forward by analyzing the calculated data. The experimental results show that the actual demand of drugs predicted by the general moving average method is relatively insufficient, with the maximum error of 41%, the minimum of 5%, and the average error of 19.8%; the maximum error of drug demand predicted by the weighted moving average method is 24%, the minimum is 2%, and the average is 15.4%. It can be concluded that the prediction effect of the weighted moving average method is better than that of the ordinary moving average method, which plays a good and effective role in the prediction of medical cost. The activity-based costing method is more detailed and organized for the cost calculation and classification of medical services. It provides a certain value for the effective management and control of medical service cost.

Challenges and Adverse Outcomes of Implementing Reimbursement Mechanisms Based on the Diagnosis-Related Group Classification System: A systematic review.

In health insurance, a reimbursement mechanism refers to a method of third-party repayment to offset the use of medical services and equipment. This systematic review aimed to identify challenges and adverse outcomes generated by the implementation of reimbursement mechanisms based on the diagnosis-related group (DRG) classification system. All articles published between 1983 and 2017 and indexed in various databases were reviewed. Of the 1,475 articles identified, 36 were relevant and were included in the analysis. Overall, the most frequent challenges were increased costs (especially for severe diseases and specialised services), a lack of adequate supervision and technical infrastructure and the complexity of the method. Adverse outcomes included reduced length of patient stay, early patient discharge, decreased admissions, increased re-admissions and reduced services. Moreover, DRG-based reimbursement mechanisms often resulted in the referral of patients to other institutions, thus transferring costs to other sectors.

[Influence of a spontaneous bacterial peritonitis, nosocomial infections and acute-on-chronic liver failure on treatment revenues in patients with decompensated cirrhosis in Germany]. / Einfluss einer spontan bakteriellen Peritonitis, nosokomialer Infektionen und eines akut auf chronischen Leberversagens auf die Behandlungserlöse bei Patienten mit dekompensierter Leberzirrhose in Deutschland.

BACKGROUND: The economic effects of spontaneous bacterial peritonitis (SBP), nosocomial infections (nosInf) and acute-on-chronic liver failure (ACLF) have so far been poorly studied. We analyzed the impact of these complications on treatment revenues in hospitalized patients with decompensated cirrhosis. METHODS: 371 consecutive patients with decompensated liver cirrhosis, who received a paracentesis between 2012 and 2016, were included retrospectively. DRG (diagnosis-related group), "ZE/NUB" (additional charges/new examination/treatment methods), medication costs, length of hospital stay as well as different kinds of specific treatments (e. g., dialysis) were considered. Exclusion criteria included any kind of malignancy, a history of organ transplantation and/or missing accounting data. RESULTS: Total treatment costs (DRG + ZE/NUB) were higher in those with nosInf (€â€Š10,653 vs. €â€Š5,611, p < 0.0001) driven by a longer hospital stay (23 d vs. 12 d, p < 0.0001). Of note, revenues per day were not different (€â€Š473 vs. €â€Š488, p = 0.98) despite a far more complicated treatment with a more frequent need for dialysis (p < 0.0001) and high-complex care (p = 0.0002). Similarly, SBP was associated with higher total revenues (€â€Š10,307 vs. €â€Š6,659, p < 0.0001). However, the far higher effort for the care of SBP patients resulted in lower daily revenues compared to patients without SBP (€â€Š443 vs. €â€Š499, p = 0.18). ACLF increased treatment revenues to €â€Š10,593 vs. €6,369 without ACLF (p < 0.0001). While treatment of ACLF was more complicated, revenue per day was not different to no-ACLF patients (€â€Š483 vs. €â€Š480, p = 0.29). CONCLUSION: SBP, nosInf and/or ACLF lead to a significant increase in the effort, revenue and duration in the treatment of patients with cirrhosis. The lower daily revenue, despite a much more complex therapy, might indicate that these complications are not yet sufficiently considered in the German DRG system.

Post-acute Use of Opioids and Psychotropics in Patients after Hip Fracture: Unintended Consequences of Implementing Diagnosis-Related Grouping Payment.

OBJECTIVE: How implementing diagnostic-related grouping (DRG) payment affected the use of opioids and psychotropics by hip fracture patients following hospitalization remained unknown. DESIGN: A retrospective, pre-post design, cohort study of data excerpted from Taiwan's National Health Insurance Research database (NHIRD). SETTING AND PARTICIPANTS: Adults aged ≥ 65 years first admitted for hip fracture surgery from 2007 to 2012 were identified and divided into two 1:1 propensity-score matched groups: pre-DRG (2007-2009); DRG (2010-2012). MEASUREMENTS: The outcome measures were use of opioid and/or psychotropic drugs within 30 days, 90 days, 180 days, and 365 days after discharge. RESULTS: Data of 16,522 subjects were excerpted, and 8,261 propensity-score matched subjects each classified into the pre-DRG and DRG groups. After adjustment, the DRG group was significantly more likely than the pre-DRG group to have used antipsychotics after discharge from hip fracture surgery (≤30 days, ≤90 days, ≤180 days and ≤365 days). The DRG group also had significantly higher prescription rates of benzodiazepines and antipsychotics during the observation period. Moreover, the DRG group was less likely to use non-steroidal anti-inflammatory drugs (≤30 days, ≤90 days, ≤180 days and ≤365 days) and more likely to use acetaminophen (≤30 days, ≤180 days, and ≤365 days). CONCLUSIONS: In conclusion, DRG implementation in Taiwan substantially increased post-acute prescription of antipsychotic and psychotropic agents for hip fracture patients, and changed use of analgesics, which may result in suboptimal quality and safety for these patients. Further research is needed to evaluate the long-term outcomes of DRG implementation, and the potential benefits of appropriate post-acute care bundled with DRG payment.

The effectiveness of the neonatal diagnosis-related group scheme.

The goal of this study is to investigate the effectiveness of the neonatal diagnosis-related group scheme in patients affected by respiratory distress syndrome. The variable costs of individual patients in the same group are examined. This study uses the data of infants (N = 243) hospitalized in the Neonatal Intensive Care Unit of the Gaslini Children's Hospital in Italy in 2016. The care unit's operating and management costs are employed to estimate the average cost per patient. Operating costs include those related to personnel, drugs, medical supplies, treatment tools, examinations, radiology, and laboratory services. Management costs relate to administration, maintenance, and depreciation cost of medical equipment. Cluster analysis and Tobit regression are employed, allowing for the assessment of the total cost per patient per day taking into account the main cost determinants: birth weight, gestational age, and discharge status. The findings highlight great variability in the costs for patients in the same diagnosis-related group, ranging from a minimum of €267 to a maximum of €265,669. This suggests the inefficiency of the diagnosis-related group system. Patients with very low birth weight incurred costs approximately twice the reimbursement set by the policy; a loss of €36,420 is estimated for every surviving baby with a birth weight lower than 1,170 grams. On the contrary, at term, newborns cost about €20,000 less than the diagnosis-related group reimbursement. The actual system benefits hospitals that mainly treat term infants with respiratory distress syndrome and penalizes hospitals taking care of very low birth weight patients. As a result, strategic behavior and "up-coding" might occur. We conduct a cluster analysis that suggests a birth weight adjustment to determine new fees that would be fairer than the current costs.

Are current DRG-based bundled payment models for revision total joint arthroplasty risk-adjusting adequately?

AIMS: Currently, the US Center for Medicaid and Medicare Services (CMS) has been testing bundled payments for revision total joint arthroplasty (TJA) through the Bundled Payment for Care Improvement (BPCI) programme. Under the BPCI, bundled payments for revision TJAs are defined on the basis of diagnosis-related groups (DRGs). However, these DRG-based bundled payment models may not be adequate to account appropriately for the varying case-complexity seen in revision TJAs. METHODS: The 2008-2014 Medicare 5% Standard Analytical Files (SAF5) were used to identify patients undergoing revision TJA under DRG codes 466, 467, or 468. Generalized linear regression models were built to assess the independent marginal cost-impact of patient, procedural, and geographic characteristics on 90-day costs. RESULTS: A total of 9,263 patients (DRG-466 = 838, DRG-467 = 4,573, and DRG-468 = 3,842) undergoing revision TJA from 2008 to 2014 were included in the study. Undergoing revision for a dislocation (+$1,221), periprosthetic fracture (+$4,454), and prosthetic joint infection (+$5,268) were associated with higher 90-day costs. Among comorbidities, malnutrition (+$10,927), chronic liver disease (+$3,894), congestive heart failure (+$3,292), anaemia (+$3,149), and coagulopathy (+$2,997) had the highest marginal cost-increase. The five US states with the highest 90-day costs were Alaska (+$14,751), Maryland (+$13,343), New York (+$7,428), Nevada (+$6,775), and California (+$6,731). CONCLUSION: Under the proposed DRG-based bundled payment methodology, surgeons would be reimbursed the same amount of money for revision TJAs, regardless of the indication (periprosthetic fracture, prosthetic joint infection, mechanical loosening) and/or patient complexity. Cite this article: Bone Joint J 2020;102-B(7):959-964.

The role of medical devices in influencing in-hospital sustainability: an analysis of expenditure in 2019 vs DRG reimbursement according to major medical specialties in a region of middle Italy.

INTRODUCTION: Very limited information exists from Italian hospitals about the utilization and expenditure of medical devices. The ratio expenditure/DRG reimbursement (expressed as a percentage) is a useful parameter, particularly when it is separately calculated for each individual Azienda and, within each Azienda, according to the medical discipline. AREAS COVERED: To generate benchmarks in this area, we have made reference to the expenditure incurred for medical devices from January to June 2019 in all hospitals of the Tuscany region. These expenditures divided by medical discipline have been compared with the DRG reimbursements that hospitals receive from our Region for the same disciplines. This benchmark is represented by percent ratio expenditure/reimbursement for each of the eight Aziende and, within each Azienda, according to the medical specialty. EXPERT OPINION: These percentages indicate, for each medical discipline, to what extent medical devices typically consume the reimbursement resulting from the DRGs. These benchmarks facilitate the interpretation of values estimated locally. Determinants leading to 'excessive' values (e.g. >100%) of this parameter can include an extensive use of costly devices, a high frequency of non-remunerative procedures, the presence of inappropriate treatments, the need to update specific DRGs, deficiencies in coding expenditures and procedures, and so on.

Case-mix for assessing primary care value (CPCV).

Measuring primary care (PC) performance and designing payment systems that reward value rather than volume have been a great challenge due in large part to lack of reliable risk adjustment mechanisms pertinent to primary care. Using risk scores designed for total resource needs to assess PC performance or set PC payment rates is inadequate because high-cost patients may not have high needs in PC and vice versa. The greatest challenge in developing a risk algorithm for PC is that significant components of PC providers' workload are unobservable but needed in the modeling. In this study, we sought to overcome this challenge by analyzing 5,172,773 patients in the U.S. Veterans Affairs (VA) healthcare system to identify potential proxies of the unobservable PC workload. By combining the number of PC visits and prescription drug classes, we formed a proxy for the expected PC workload, which enabled us to develop a case-mix algorithm pertaining to primary care. The resultant algorithm with high explanatory power (R2 = 0.702) is based on a publicly available patient classification system to account for patient comorbidities and thus can be used by other health systems to compare PC performance, workload, staffing levels, and to set more equitable payment rates.