Transition to Diagnosis-Related Group (DRG) Payments for Health: Lessons from Case Studies
Open accessAbstract
This book examines how nine different health systems--U.S. Medicare, Australia, Thailand, Kyrgyz Republic, Germany, Estonia, Croatia, China (Beijing) and the Russian Federation--have transitioned to using case-based payments, and especially diagnosis-related groups (DRGs), as part of their provider payment mix for hospital care. It sheds light on why particular technical design choices were made, what enabling investments were pertinent, and what broader political and institutional issues needed to be considered. The strategies used to phase in DRG payment receive special attention. These nine systems have been selected because they represent a variety of different approaches and experiences in DRG transition. They include the innovators who pioneered DRG payment systems (namely the United States and Australia), mature systems (such as Thailand, Germany, and Estonia), and countries where DRG payments were only introduced within the past decade (such as the Russian Federation and China). Each system is examined in detail as a separate case study, with a synthesis distilling the cross-cutting lessons learned. This book should be helpful to those working on health systems that are considering introducing, or are in the early stages of introducing, DRG-based payments into their provider payment mix. It will enhance the reader's understanding of how other countries (or systems) have made that transition, give a sense of the decisions that lie ahead, and offer options that can be considered. It will also be useful to those working in health systems that already include DRG payments in the payment mix but have not yet achieved the anticipated results.
The claims and statistics of this paper haven’t been checked yet.
Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.
Integrity signals
Registry
Cites
Statistics
Claims the paper makes
The claims and statistics of this paper haven’t been checked yet.
Run the check — free, no account needed. It reads the open-access text and checks the sources it cites.
Claims other papers make about this one
Each is checked against this paper’s own text: does it say what the citing paper says it does?
The DRG payment system has become a significant component of healthcare payments in many countries to promote risk-sharing between healthcare providers and payers.
“The payment system based on diagnosis-related groups, or DRGs, was designed to manage healthcare costs and maintain sustainable operations for inpatients and it has become a significant component of healthcare payments in many countries to promote risk-sharing between healthcare providers and payers1,2.”
From Early prediction of diagnostic-related groups and estimation of hospital cost by processing clinical notes (2021) · cites this paper as [1]
Self-check
Percentages, sums and reported differences re-computed from the paper’s own numbers.
The self-check needs the paper’s full text.
Cites
The publisher hasn’t deposited this paper’s reference list.
Research works printed but not linked: 23
- Busse, R., A. Geissler, W. Quentin, and m. Wiley. 2011. "Diagnosis Related Groups in Europe: moving towards Transparency, Efficiency, and Quality in Hospitals?" European Observatory on Health Systems and Policies.
- Duckett, S. 2008. "Casemix Development and Implementation in Australia." In The Globalization of Managerial Innovation in Health Care, edited by G. Kimberly de Pouvourille and T. d'Aunno, 231-53. Cambridge, UK: Cambridge University Press.
- Turner, L., and S. D. Short. 1999. "George Rupert Palmer -DRG Carrier and Champion." Australian Health Review 22 (2): 86-102.
- Willcox, S. 2005. "Buying Best Value Health Care: Evolution of Purchasing among Australian Private Health Insurers." Australia and New Zealand Health Policy 2 (1): 6. Accessed November 15, 2018, at http:/www.anzhealthpolicy.com/content/2/1/6.
- Busse, R., and m. Blümel. 2014. "Germany: Health System Review." Health Systems in Transition 16 (2): 1-296.
- Klein-Hitpaß, U., and D. Scheller-Kreinsen. "Policy Trends and Reforms in the German DRG- Based Hospital Payment System." Health Policy 119 (3): 252-57.
- Džakula, A., A. Sagan, N. Pavić., K. Lončarek, and K. Sekelj-Kauzlarić. 2014. "Croatia: Health System Review." Health Systems in Transition 16 (3): 1-162.
- Voncina, L., T. Strizrep, and A. Džakula. 2007. "The Introduction of DRGs in Croatia." EuroHealth-London 13 (1): 4-5.
- Busse, R., and m. Blümel. "Germany: Health System Review." Health Systems in Transition 16 (2): 1-296.
- Busse, R., A. Geissler, W. Quentin, and m. Wiley. 2011. "Diagnosis Related Groups in Europe: moving towards Transparency, Efficiency, and Quality in Hospitals?" European Observatory on Health Systems and Policies.
- Duckett, S. 2008. "Casemix Development and Implementation in Australia." In The Globalization of Managerial Innovation in Health Care, edited by G. Kimberly de Pouvourille and T. d'Aunno, 231-53. Cambridge, UK: Cambridge University Press.
- Džakula, A., A. Sagan, N. Pavić, K. Lončarek, and K. Sekelj-Kauzlarić. 2014. "Croatia: Health System Review." Health Systems in Transition 16 (3): 1-162.
- Fetter, R. B., and J. D. Thompson. 1965. "The Simulation of Hospital Systems." Operations Research 13 (5): 689-711.
- Ibraimova, A., B. Akkazieva, A. Ibraimov, E. manzhieva, and B. Rechel. 2011. "Kyrgyz Republic: Health System Review." Health Systems in Transition 13 (3): 1-152.
- Jian, W., m. Lu, K. Y. Chan, A. N. Poon, W. Han, m. Hu, and W. Yip. 2015. "Payment Reform Pilot in Beijing Hospitals Reduced Expenditures and Out-of-Pocket Payments per Admission." Health Affairs 34 (10): 1745-52.
- Jian, W. Y., m. Lu, T. Cui, and m. Hu. 2011. "Evaluating Performance of Local Case-mix System by International Comparison: A Case Study in Beijing, China." International Journal of Health Planning and Management 26 (4): 471-81.
- Jian, W., m. Lu, W. Han, and m. Hu. 2016. "Introducing Diagnosis-Related Groups: Is the Information System Ready?" International Journal of Health Planning and Management 31 (1): E58-68.
- Klein-Hitpaß, U., and D. Scheller-Kreinsen. 2015. "Policy Trends and Reforms in the German DRG-Based Hospital Payment System." Health Policy 11 (3): 252-57.
- Kutzin, J., A. Ibraimova, m. Jakab, and S. O'Dougherty. 2009. "Bismarck meets Beveridge on the Silk Road: Coordinating Funding Sources to Create a Universal Health Financing System in Kyrgyz Republic." Bulletin of the World Health Organization 87: 549-54.
- Turner, L., and S. D. Short. 1999. "George Rupert Palmer-DRG Carrier and Champion." Australian Health Review 22 (2): 86-102.
- Vončina, L., T. Strizrep, and A. Dzakula. 2007. "The Introduction of DRGs in Croatia." EuroHealth-London 13 (1): 4.
- Vončina, L., T. Strizrep, m. Bagat, D. Pezelj-Duliba, N. Pavić, and O. Polašek. 2012. "Croatian 2008-2010 Health Insurance Reform: Hard Choices toward Financial Sustainability and Efficiency." Croatian Medical Journal 53 (1): 66-76.
- Willcox, S. 2005. "Buying Best Value Health Care: Evolution of Purchasing among Australian Private Health Insurers." Australia and New Zealand Health Policy 2 (1): 6. Accessed November 15, 2018, at http:/www.anzhealthpolicy.com/content/2/1/6.
Cited by
Sorted by citations
Liu, J., Capurro, D., Nguyen, A., & Verspoor, K. (2021) · npj Digital Medicine · doi:10.1038/s41746-021-00474-9 · Cited by 50 · see citing works
“Case 5 (160,077) 289: Acute & subacute endocarditis W CC (1) 378: G.”
Ding, Y., Yin, J., Zheng, C., et al. (2023) · Frontiers in Public Health · doi:10.3389/fpubh.2023.1069131 · Cited by 47 · see citing works
International strategies, experiences, and payment models to incentivise day surgery
Kreutzberg, A., Eckhardt, H., Milstein, R., et al. (2023) · Health Policy · doi:10.1016/j.healthpol.2023.104968 · Cited by 22 · see citing works
Zhu, T. T., Chen, C., Zhang, X., et al. (2024) · BMJ Open · doi:10.1136/bmjopen-2023-073913 · Cited by 19 · see citing works
Guinness, L., Ghosh, S., Mehndiratta, A., & Shah, H. A. (2022) · BMJ Open · doi:10.1136/bmjopen-2022-065019 · Cited by 12 · see citing works
National hospital costing systems matter for universal healthcare: the India PM-JAY experience
Prinja, S., Chugh, Y., Garg, B., et al. (2023) · BMJ Global Health · doi:10.1136/bmjgh-2023-012987 · Cited by 11 · see citing works
Prinja, S., Bahuguna, P., Singh, M. P., et al. (2023) · BMJ Open · doi:10.1136/bmjopen-2023-076155 · Cited by 11 · see citing works
Fan, W., Jiang, Y., Pei, J., Ping, Y., & Qiu, L. (2023) · Decision Sciences · doi:10.1111/deci.12593 · Cited by 9 · see citing works
Knowledge–practice gap in healthcare payments: the role of policy capacity
Bali, A. S., & Ramesh, M. (2023) · Policy and Society · doi:10.1093/polsoc/puad019 · Cited by 7 · see citing works
Health care cost accounting in the Indian hospital sector
Chugh, Y., Sharma, S., Mehndiratta, A., et al. (2024) · Health Policy and Planning · doi:10.1093/heapol/czae040 · Cited by 5 · see citing works
“Experiences in Thailand, Kyrgyzstan and China showcase how cost systems can evolve iteratively from initial one-time exercises into complex systems with increasing provider participation as capacity evolves (Mathauer and Wittenbecher, 2013; Bredenkamp et al ., 2020).”
BackgroundNurkholis, N., Mardiati, E., Fachriyah, N., Prayudi, M. A., & Widaninggar, N. (2023) · Journal of Accounting and Investment · doi:10.18196/jai.v24i2.16949 · Cited by 4 · see citing works
Folguera-Profitós, J., Buj, E., Monterde, D., et al. (2024) · Health Economics Review · doi:10.1186/s13561-024-00522-6 · Cited by 3 · see citing works
“Similarly, prospective per-diem payments – where providers are paid for a type of in-patient day, hampered healthcare planning and budgeting [3].”
Palupi, S., Htet, K. K. K., Nakhonsri, V., Ngamphiw, C., Khunkham, P., Vasoppakarn, S., Atthakul, N., Tongsima, S., Keeratipusana, C., Janpoung, W., et al. (2024) · PLoS ONE · doi:10.1371/journal.pone.0310090 · Cited by 2 · see citing works
“The relative weights (RW) of each DRG were determined based on existing hospital charges and health insurance reimbursement [13].”
MethodA two-stage stochastic game model for elective surgical capacity planning and investment
Acuna, J. A., Cantarino, D., Martínez, R., & Zayas‐Castro, J. L. (2023) · Socio-Economic Planning Sciences · doi:10.1016/j.seps.2023.101786 · Cited by 2 · see citing works
Chugh, Y., Sharma, S., Guinness, L., Sharma, D., Garg, B., Mehndiratta, A., & Prinja, S. (2024) · BMJ Open · doi:10.1136/bmjopen-2023-082965 · Cited by 2 · see citing works
Kabaniha, G. A., Ataguba, J. E.-O., & Kutzin, J. (2020) · Springer eBooks · doi:10.1007/978-3-030-05325-3_68-1 · Cited by 2 · see citing works
Designing a model for implementing diagnosis‐related groups in Iran: An action plan approach
Asadi, F., Anvari, M., Ghaderzadeh, M., et al. (2024) · Health Science Reports · doi:10.1002/hsr2.1854 · Cited by 1 · see citing works
“5,7 Thus, DRGs have been developed with the aim of being a tool to manage costs and assist hospitals and clinics in controlling the consumption and quality of services.”
MethodInternational experience and proposals for reform of hospital payment model in Russia. Part 1
Borisenko, O. (2020) · Medical Technologies Assessment and Choice · doi:10.17116/medtech20204204152 · Cited by 1 · see citing works
Kalanj, K., Orešković, S., Tkaličanac, M., et al. (2022) · Zbornik sveučilišta Libertas · doi:10.46672/zsl.7.7.4
Translating health economics research into public health action: Towards an economy of wellbeing
(2024) · Frontiers research topics · doi:10.3389/978-2-8325-4747-2
dos Santos, M. A. B., da Silva, R. S., Benevides, R. P. D. S. E., et al. (2023) · Instituto de Pesquisa Econômica Aplicada (Ipea) eBooks · doi:10.38116/td2925-port
O modelo de remuneração das Organizações Sociais de Saúde (OSS) hospitalares do estado de São Paulo
Levi, M. L., Ferreira, M. R. J., & Duarte, L. S. (2025) · Revista de Administração Pública · doi:10.1590/0034-761220230406
The payment system for social organizations managing state-owned hospitals in São Paulo
Levi, M. L., Ferreira, M. R. J., & Duarte, L. S. (2025) · Revista de Administração Pública · doi:10.1590/0034-761220230406x
Принцип клинико-затратных групп в системе здравоохранения Кыргызской Республики
Азимжанова, М. Н., Темирбекович, К. М., & Imankulova, A. S. (2025) · Бюллетень Национального научно-исследовательского института общественного здоровья имени Н. А. Семашко · doi:10.69541/nriph.2025.04.008
- Authors
- Bales, S., Bredenkamp, C., & Kahur, K.
- ORCID
- Bales, Sarah
- Venue
- World Bank, Washington, DC eBooks
- Publisher
- Washington, DC: World Bank
- Published
- 2019-12-17
- OpenAlex
- W2995766055
- Cited by
- 25
- References
- 0
- Citations by year
- 2025: 3 · 2024: 7 · 2023: 9 · 2022: 2 · 2021: 2 · 2020: 2
- FWCI
- 1.65
- Type
- book
- Language
- en
- Open access
- Licence
- other-oa
- Locations
- World Bank, Washington, DC eBooks (publishedVersion)
- The World Bank Open Knowledge Repository (World Bank) (submittedVersion, other-oa)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Finance › Healthcare Systems and Reforms
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Healthcare Policy and Management
- Health Sciences › Health Professions › General Health Professions › Healthcare Systems and Practices
- Keywords
- diagnosis-related groups, case-based payment, hospital payment reform, Medicare, Australia, Thailand, Germany, Estonia, Croatia, China, Russia, health system transition, payment design, health policy, institutional change
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
Are you an author, or do you see a problem with this page? Request a review