The second stage of the diagnosis-related group (DRG) system launched on Tuesday has received a lot of negative publicity in the media recently, but the DRG payment system has already been introduced in many other countries.
As a National Health Insurance Administration official has said, it is a “turnkey” system in which the treatment for a given type of illness is reimbursed at a specified amount that has been calculated by averaging out past reimbursements for that treatment.
Of course, when a healthcare provider starts treating a patient, the actual circumstances of that person’s illness, and therefore the cost of their treatment, will depend on the individual case.
The unpredictable nature of that situation means that in some cases, a hospital will make money in the provision of the treatment, while in others it will be making a loss.
However, the point is, for a hospital doing it right, everything will balance out over the long term.
The crucial concept behind the DRG system is that responsibility for controlling the quality and cost of the treatment is given to the treatment provider, and the better that provider regulates itself, the more it stands to make.
Until now, under the fee-for-service payment system, the more the hospital did, the more it was reimbursed.
This had its own disadvantages, but one concern was that the more mistakes it made and the more problems it caused, the more it would end up being reimbursed.
One doctor writing in a Chinese-language newspaper recently said: “Under the current system, if an operation is done well, the hospital is reimbursed once; if the operation goes badly and has to be done again, the hospital will get paid two, even three times, all on the National Health Insurance, and the hospitals and doctors actually stand to make money in this way.”
Several days ago, a colleague of mine saw a patient who had just been operated on for breast cancer in another medical center and had come to us for a second opinion.
Before seeing her original pathology slide to make a reassessment and based upon the patient’s medical notes alone, my colleague’s initial impression was that the patient did not require chemotherapy.
However, the doctor in the original medical center had told her that she should start a course of chemotherapy as soon as possible and had also recommended that she undergo a genetic test, which she would have to pay for out of her own pocket.
Just as we were preparing our own pathology slide for the patient, she was called back to the original medical center to have a “portacath” implanted in preparation for the chemotherapy.
The point is that, even with the accredited medical framework in this country, where we have very clear standards and regulations for cancer treatment, it is by no means rare today for unscrupulous practitioners, in the interests of making a fast buck, to recommend unnecessary treatments.
Also, these doctors are not only prepared to spend National Health Insurance money and subject patients to mental and physical pain in the process — for example, by making them undergo chemotherapy they simply do not need — these practitioners are also quite happy for patients to spend their own money on genetic tests that are of absolutely no use to them.
This is utterly unconscionable.
It was likewise exasperating to read in the Chinese-language Business Weekly’s special report on the DRG system such incidents as doctors turning away patients, or such ideas as: “If I were a hospital administrator, I might warn doctors not to ask me to take on high-risk patients,” or “when the DRG system is implemented, fewer tests might be done because of concerns over costs, which could result in an increase in the rate of misdiagnoses.”
My colleagues in the medical profession speak quite openly about how this new system will disregard patients’ rights and only take profit into account.
You have to ask, what about the reason they became doctors in the first place? Does their Hippocratic Oath mean nothing all of a sudden?
The experience in the West has been that the DRG remuneration system has acted as a deterrent to the regrettable practice of hospitals and doctors doing unnecessary treatments, taking in more patients and earning more money in the process.
In fact, it has made hospitals more efficient and improved the quality of the treatment they provide.
It is only when offering more treatments and taking in more patients fails to translate into higher remuneration that healthcare providers have the incentive to cure patients as quickly as possible.
Following the implementation of the DRG system, the number of hospital beds in the US and Canada has halved, but this has not resulted in longer waiting lists for patients with serious illnesses.
Rather, it is because hospitals have simultaneously reduced the number of patients with less serious problems staying in hospitals and taking up beds and reduced the length of time patients remain hospitalized.
Also, doctors who originally entered this field revel in more complex cases, seeing them as challenges that motivate them to work harder to effect a cure.
The more challenging the treatment, the more achievement these doctors feel when they are able to heal the patient.
Why would they turn these patients away?
If healthcare providers respect the spirit of the DRG system and create maximum value in the most efficient and most economical way for their patients, we can achieve a triple-win situation that benefits medical treatment, patients and the National Health Insurance program.
Andrew Huang is president of the Koo Foundation Sun Yat-sen Cancer Center.
Translated by Paul Cooper
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