Investigating DRG cost weights for hospitals in middle income countries

Ghaffari, Shahram, Doran, Christopher, Wilson, Andrew, Aisbett, Chris and Jackson, Terri (2009) Investigating DRG cost weights for hospitals in middle income countries. International Journal of Health Planning and Management, 24 3: 251-264. doi:10.1002/hpm.948

Author Ghaffari, Shahram
Doran, Christopher
Wilson, Andrew
Aisbett, Chris
Jackson, Terri
Title Investigating DRG cost weights for hospitals in middle income countries
Journal name International Journal of Health Planning and Management   Check publisher's open access policy
ISSN 1099-1751
Publication date 2009-01-01
Year available 2008
Sub-type Article (original research)
DOI 10.1002/hpm.948
Open Access Status Not yet assessed
Volume 24
Issue 3
Start page 251
End page 264
Total pages 14
Place of publication Chichester, U.K.
Publisher Wiley
Language eng
Subject 1117 Public Health and Health Services
Abstract Identifying the cost of hospital outputs, particularly acute inpatients measured by Diagnosis Related Groups (DRGs), is an important component of casemix implementation. Measuring the relative costliness of specific DRGs is useful for a wide range of policy and planning applications. Estimating the relative use of resources per DRG can be done through different costing approaches depending on availability of information and time and budget. This study aims to guide costing efforts in Iran and other countries in the region that are pursuing casemix funding, through identifying the main issues facing cost finding approaches and introducing the costing models compatible with their hospitals accounting and management structures. The results show that inadequate financial and utilisation information at the patient's level, poorly computerized feeder systems; and low quality data make it impossible to estimate reliable DRGs costs through clinical costing. A cost modelling approach estimates the average cost of 2.723 million Rials (Iranian Currency) per DRG. Using standard linear regression, a coefficient of 0.14 (CI = 0.12-0.16) suggests that the average cost weight increases by 14% for every one-day increase in average length of stay (LOS). We concluded that calculation of DRG cost weights (CWs) using Australian service weights provides a sensible starting place for DRG-based hospital management; but restructuring hospital accounting systems, designing computerized feeder systems, using appropriate software, and development of national service weights that reflect local practice patterns will enhance the accuracy of DRG CWs. Copyright © 2008 John Wiley & Sons, Ltd.
Keyword DRG cost weights
Clinical costing
Cost modelling
Q-Index Code C1
Q-Index Status Provisional Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Excellence in Research Australia (ERA) - Collection
School of Public Health Publications
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Citation counts: TR Web of Science Citation Count  Cited 6 times in Thomson Reuters Web of Science Article | Citations
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Created: Mon, 23 Mar 2009, 23:09:35 EST by Joanne Mellor on behalf of School of Public Health