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From downcoding to upcoding: DRG based payment in hospitals
[Du downcoding au upcoding : Le paiement par DRG dans les hôpitaux]

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  • Carine Milcent

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

A prospective disease group-based payment is a reimbursement rule used in a wide array of countries. It turns to be the hospital's payment rule to imply. The secret of this payment is a fee payment as well as a hospital's activity based payment. There is a consensus to consider this rule of payment as the least likely to be manipulated by the actors. However, the defined fee per group depends on recorded information that is then processed using complex algorithms. What if the data itself can be manipulated? The result would be a fee per group based on manipulated factors that would lead to an inefficient budget allocation between hospitals. Using a unique French longitudinal database with 145 million stays, I unambiguously demonstrate that the implementation of a finer classification led to a up-coding. The end result has been a budget transfer from public non-research hospitals to for-profit hospitals. This budget reallocation did not correspond to any change in the actual production of care.

Suggested Citation

  • Carine Milcent, 2019. "From downcoding to upcoding: DRG based payment in hospitals [Du downcoding au upcoding : Le paiement par DRG dans les hôpitaux]," PSE Working Papers halshs-03966671, HAL.
  • Handle: RePEc:hal:psewpa:halshs-03966671
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-03966671
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    References listed on IDEAS

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