Evaluation of the introduction of a diagnosis procedure combination system for patient outcome and hospitalisation charges for patients with hip fracture or lung cancer in Japan

Kondo, Akiko; Kawabuchi, Koichi

doi:10.1016/j.healthpol.2012.08.010

Cited by 17 publications

(19 citation statements)

References 16 publications

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“…As for the nonemergency readmission rate, the economic theory suggests that it increases when a readmitted patient has a higher revenue‐to‐cost margin compared with a potential patient who might have been admitted to sustain the same bed occupancy rate (Hockenberry et al ., ; Kondo and Kawabuchi, ). The findings in the present paper for percentiles 26–100 may be viewed as an empirical confirmation of this assumption.…”

Section: Discussionmentioning

confidence: 99%

“…This paper tests, in particular, whether the declining rates result in differential changes in the nonemergency/unanticipated (i.e., planned) early readmission rate. Indeed, the rise of the early readmission rate owing to the reform (Hamada et al ., ; Yasunaga et al ., ) might be primarily explained by an increase in the prevalence of nonemergency/unanticipated readmissions (Okamura et al ., ) which, in turn, would be caused by step‐down of the per diem PPS tariff (Kondo and Kawabuchi, ).…”

Section: Methodsmentioning

confidence: 99%

“…The per diem PPS led to reduction of excess costs for material and laboratory tests (Ikegami, ; Okamura et al ., ). Later, a system with per case payments was introduced at 10 acute‐care hospitals in 1998–2004 (Kondo and Kawabuchi, ). However, owing to high diversity of medical treatment patterns, the effect of this full PPS was ambiguous, and the system was not expanded nationwide (Kondo and Kawabuchi, ; Okamura et al ., ).…”

Section: Per Diem Payment System In Japanmentioning

confidence: 99%

“…Later, a system with per case payments was introduced at 10 acute‐care hospitals in 1998–2004 (Kondo and Kawabuchi, ). However, owing to high diversity of medical treatment patterns, the effect of this full PPS was ambiguous, and the system was not expanded nationwide (Kondo and Kawabuchi, ; Okamura et al ., ). Instead, a special version of the per diem payment system was introduced in 2003 at 82 special‐function hospitals, providing high‐technology health care.…”

Section: Per Diem Payment System In Japanmentioning

confidence: 99%

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Differential Effects of Declining Rates in a Per Diem Payment System

Besstremyannaya

2014

Health Economics

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The paper demonstrates differential effects of a prospective payment system with declining per diem rates, dependent on the percentiles of length of stay. The analysis uses dynamic panel data estimates and a recent nationwide administrative database for major diagnostic categories in 1068 Japanese hospitals in 2006-2012 to show that average length of stay significantly increases for hospitals in percentiles 0-25 of the pre-reform length of stay and significantly decreases for hospitals in percentiles 51-100. The decline of the average length of stay is larger for hospitals in higher percentiles of the length of stay. Hospitals in percentiles 51-100 significantly increase their rate of nonemergency/unanticipated readmissions within 42 days after discharge. The decline in the length of total episode of treatment is smaller for hospitals in percentiles 0-25. The findings are robust in terms of the choice of a cohort of hospitals joining the reform. The paper discusses applicability of 'best practice' rate-setting to help improve the performance of hospitals in the lowest quartile of average length of stay. Copyright © 2015 John Wiley & Sons, Ltd.

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Section: Discussionmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Section: Per Diem Payment System In Japanmentioning

confidence: 99%

Section: Per Diem Payment System In Japanmentioning

confidence: 99%

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Differential Effects of Declining Rates in a Per Diem Payment System

Besstremyannaya

2014

Health Economics

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“…The Japanese government has also tried to reduce the LOS to save expenditures by instituting a kind of fixed payment plan called the Diagnosis Procedure Combination (DPC) [4] and by separating care provided in rehabilitation hospitals from that provided in acute care settings. This system is similar to the system in the US.…”

Section: Introductionmentioning

confidence: 99%

Nursing Care after Hip Fracture Surgery Predicts Patient Ambulatory Ability at 3 Months after Surgery

Kondo

Sada²,

Yamaguchi³

et al. 2013

J Nurs Care

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The best of both worlds? The economic effects of a hybrid fee‐for‐service and prospective payment reimbursement system

Shen

Noguchi

2020

Health Economics

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Countries seeking to move away from a purely fee-for-service (FFS) system may consider a hybrid approach whereby only some procedures are paid by FFS while others are paid prospectively. Yet little evidence exists whether such a hybrid payment system contains overall costs without adverse influences on health outcomes. In 2003, Japan experienced a reform from FFS to a hybrid payment system in which only some inpatient procedures were paid prospectively. We exploit this reform to test how such a hybrid system affects overall costs and health outcomes. Briefly, we find that healthcare providers responded opportunistically to the reform, moving some procedures out of the bundled inpatient setting to FFS services, leading to no reduction in cost. There was some evidence of a moderate deterioration in health outcomes, in terms of a decline in the probability of symptoms being cured at discharge. In sum, our results suggest that in some cases, a hybrid payment system can be non-superior to either FFS or prospective payment system. K E Y W O R D S bundled payment, hybrid payment system, substitution behavior, price regulation 1 | INTRODUCTION Since 2000, global health spending has increased at an annual rate of 4.0%, about 1.5 times the 2.8% annual growth rate of the global economy (Xu et al., 2018). To contain costs, many countries have opted to replace traditional Fee-For-Service (FFS) payments with a prospective payment system (PPS), incentivizing providers to reduce costs by avoiding unnecessary services (Carroll, Chernew, Fendrick, Thompson, & Rose, 2018; Ho & Pakes, 2014). However, providers could also be incentivized to avoid unprofitable patients and discharge patients inappropriately early (Ellis, 1998; Gilman, 2000). Such behaviors may reduce costs at the expense of population health; for example, Cutler (1995) finds higher mortality and readmission rates at hospitals paid by PPS. Consequently, an increasing number of countries have experimented with hybridizing the two payment systems to preserve the advantages and mitigate the disadvantages of each (Ellis & McGuire, 1986; Ma, 1994; Robinson, 2001). The PPS nature of a hybrid payment system can blunt the excessive financial incentives of FFS and contain costs. The FFS nature, in turn, can mitigate the unintended incentives of PPS and prevent undertreatments. Empirical evidence is mixed regarding whether a hybrid payment system is better at containing costs than a pure FFS. A few experimental studies show that capitation-FFS hybrid systems have smaller deviations from the optimal level of treatments compared

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Evaluation of the introduction of a diagnosis procedure combination system for patient outcome and hospitalisation charges for patients with hip fracture or lung cancer in Japan

Cited by 17 publications

References 16 publications

Differential Effects of Declining Rates in a Per Diem Payment System

Differential Effects of Declining Rates in a Per Diem Payment System

Nursing Care after Hip Fracture Surgery Predicts Patient Ambulatory Ability at 3 Months after Surgery

The best of both worlds? The economic effects of a hybrid fee‐for‐service and prospective payment reimbursement system

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