China’s transition to DRG-based hospital reimbursement

China has been transitioning from a fee-for-service (FFS) payment system to a Diagnosis-Related Group (DRG) payment system for hospitals in various cities. Under the FFS model, hospitals were reimbursed for each individual healthcare service provided, which created incentives to increase the number of services during a patient’s hospitalization. In June 2019, the National Healthcare Security…

Costing Methods

How do hospitals estimate the cost of different inpatient stays?  A paper by Clement et al. (2009) reviews 3 techniques: Microcosting. “With microcosting, a detailed list of each component of a patient’s care is created and costed separately for each facet of a patient’s hospitalization. Given the level of detail, microcosting is generally considered the…