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Hospital specialisation within a DRG-Framework: The Austrian Case

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  • Conrad Kobel
  • Engelbert Theurl

Abstract

Evaluation of the true relationship between costs and specialisation in hospitals is hindered by the lack of a standard measure. Specialised hospitals might produce at lower costs because their staff builds expertise and care is better organised. On the other hand specialised hospitals might be more costly because they systematically attract sicker patients within each diagnosis-related group (DRG) or have special equipment available. We compare three common measures of specialisation and introduce an alternative, which builds on the widely used Gini coefficient, and investigate the influence of the Austrian provincial health-policy making on specialisation. Although the four measures differ in definition, they show high concordance and prove to assess hospital specialisation in a robust way. With the exception of university hospitals, measured specialisation complies with the different hospital types as defined by legislation in Austria. We find no significant time trend towards more specialisation and legislation on provincial level seems to have a small impact on hospital specialisation. However, caution should be paid to skewness, so that outliers do not inappropriately influence the results when evaluating the true relationship between costs and the specialisation of hospitals. Overall, the Austrian DRG framework introduced in 1997 and regional regulation by the Provinces have not led to more specialised hospitals. This finding challenges the expected impact of activity based funding on specialisation, but it may reflect the lack of incentives set by the Austrian DRG framework and the Provinces.

Suggested Citation

  • Conrad Kobel & Engelbert Theurl, 2013. "Hospital specialisation within a DRG-Framework: The Austrian Case," Working Papers 2013-06, Faculty of Economics and Statistics, University of Innsbruck.
  • Handle: RePEc:inn:wpaper:2013-06
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    References listed on IDEAS

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    1. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-591, September.
    2. David Dranove, 1987. "Rate-Setting by Diagnosis Related Groups and Hospital Specialization," RAND Journal of Economics, The RAND Corporation, vol. 18(3), pages 417-427, Autumn.
    3. Andrew Street & Conrad Kobel & Thomas Renaud & Josselin Thuilliez & ON BEHALF OF THE EURODRG GROUP, 2012. "How Well Do Diagnosis‐Related Groups Explain Variations In Costs Or Length Of Stay Among Patients And Across Hospitals? Methods For Analysing Routine Patient Data," Health Economics, John Wiley & Sons, Ltd., vol. 21(S2), pages 6-18, August.
    4. Andrew Street & Conrad Kobel & Thomas Renaud & Josselin Thuilliez & ON BEHALF OF THE EURODRG GROUP, 2012. "How Well Do Diagnosis‐Related Groups Explain Variations In Costs Or Length Of Stay Among Patients And Across Hospitals? Methods For Analysing Routine Patient Data," Health Economics, John Wiley & Sons, Ltd., vol. 21(S2), pages 6-18, August.
    5. Conrad Kobel & Josselin Thuilliez & Martine Bellanger & Karl-Peter Pfeiffer, 2011. "DRG systems and similar patient classification systems in Europe," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00643049, HAL.
    6. Silvio Daidone & Francesco D’Amico, 2009. "Technical efficiency, specialization and ownership form: evidences from a pooling of Italian hospitals," Journal of Productivity Analysis, Springer, vol. 32(3), pages 203-216, December.
    7. Farley, Dean E., 1989. "Measuring casemix specialization and the concentration of diagnoses in hospitals using information theory," Journal of Health Economics, Elsevier, vol. 8(2), pages 185-207, June.
    8. Kazuhiko Kakamu & Mototsugu Fukushige, 2009. "Multilevel Decomposition Methods For Income Inequality Measures," The Japanese Economic Review, Japanese Economic Association, vol. 60(3), pages 333-344, September.
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    Cited by:

    1. Yauheniya Varabyova & Carl Rudolf Blankart & Aleksandra Torbica & Jonas Schreyögg, 2017. "Comparing the Efficiency of Hospitals in Italy and Germany: Nonparametric Conditional Approach Based on Partial Frontier," Health Care Management Science, Springer, vol. 20(3), pages 379-394, September.

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    More about this item

    Keywords

    Hospital specialisation; Hospital financing; Herfindahl-Hirschman index; Information theory index; Gini coefficient; Decomposition of Inequality; Austria;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises

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