Effects of diagnosis-related group payment on health-care provider behaviors: A consecutive three-period study

Background: This study aimed to evaluate the impact of diagnosis-related group (DRG) payments on health-care providers' behavior and the potential best course of action to make a profit under a DRG payment mechanism.

Methods: This is a natural experiment study with a tertiary hospital-based dataset. Under a consecutive three-period (3 years) or 12-period (12 seasons) design, length of stay, medical cost with detailed items, the percentage of general anesthesia (GA), and the percentage of receiving additional operations were compared. Furthermore, the differences between negative- and positive-profit groups were also examined.

Results: There was no difference in the length of stay and total medical cost after the launch of the DRG payment scheme. However, the percentage of additional operations increased significantly. In addition, there were reduced costs of radiological images and medication, a reduced percentage of GA, fewer patients undergoing additional operations, and a higher rate of complications or comorbidities in the "positive-profit group."

Conclusion: The introduction of DRG payment resulted in significantly reduced examination fee, slightly decreased medical costs without significant difference in several detailed items, a reduced number of GA cases without statistical significance, and more patients receiving additional operations. The possible solution to make a profit under the DRG payment scheme is to curtail the costs of radiological images and medication, lower GA percentage, perform fewer additional operations, and correct recording of complications or comorbidities.