Does the Extent of Per-Case Payment System Affect Hospital Efficiency? Evidence from the Italian NHS

Regional regulators in health care service under quality competition: A game theoretical model

“…The seminal contributions of Ellis and McGuire (); Ma (); Street, O'Reilly, Ward, and Mason (); among others show that hospital payment schemes based on full reimbursement of the incurred costs lead to a “medical arms race” among hospitals and, thus, to an escalation of health care costs (Cavalierie, Guccio, Lisi, & Pignataro, ); a prospective per case reimbursement system seems to be appropriate, to lead hospitals to more efficient choices. The empirical literature concerning the determinants and the effects of DRG prices (see, e.g., various chapters in Culyer & Newhouse, ; Pauli, McGuire, & Barros, ; see also Mikkala, Keskimaki, & Hakkinene, ; Schreyoegg, Stargardt, Tiemann, & Busse, ) show that the determinants of price levels typically include the estimated cost, taking into consideration different components, with a different weight of past history and prospective evolution, according to different countries.…”

Understanding variations in hospital length of stay and cost

“…Following findings from the literature (Cavalieri et al 2016;Street et al 2011: Ellis andMcGuire 1986), two country features are identified and measured for this pilot work as follows:  Hospital payment system: DRG; global budget; fee-for-service  Level of negotiation of hospital prices/budget: central level; local/subnational level…”

Investigating the geographic disparity in quality of care: the case of hospital readmission after acute myocardial infarction in Italy

“…In 2001, fiscal decentralisation to the regions was implemented (legislative decree 56/2000), and such constitutional reform in Italy endowed regions with the freedom to choose the type of healthcare model [ 42 ]. What was previously known as the Local Health Units ( Unità Sanitarie Locali ) were transformed into the current Local Health Authorities (LHAs), which directly run the public Hospital Units (HUs or Ospedalia Gestione Diretta ) with their capitated budget and management [ 44 ]. Other hospital ownership types included Hospital Trust ( Aziende Ospedaliere ) that are granted the status of trusts with full managerial autonomy, Teaching Hospitals ( Clinici o Policlinici Universitari ), Research Hospitals ( Istituto di Ricovero e Cura a Carattere Scientifico, IRCCS ), Accredited Private Hospitals ( Case di Cura Accreditate ) and other private providers that compete with public hospitals in healthcare deliveries.…”

“…Regarding hospital care financing, regions have full autonomy to identify the services to be reimbursed through lump-sum, and to opt for their own diagnosis-related groups (DRGs) tariffs and funding schemes. Regional tariffs may be differentiated by the provider type to reflect the production costs and different responses to price incentives [ 44 ]. In general, public Hospital Units directly managed by LHAs are solely financed by global budgets that are based on the consumption of production factors such as personnel, and goods and services.…”

“…In general, public Hospital Units directly managed by LHAs are solely financed by global budgets that are based on the consumption of production factors such as personnel, and goods and services. Their budgets are kept separated from the overall budget of LHA’s, but their expenses are fully covered within the LHA’s financial resources retrospectively [ 44 ]. Therefore, Hospital Units do not necessarily have the financial incentives to attract patients and have less pressure to discharge patients early to reduce costs.…”