In September 2022, the University of Hamburg published its study on the effects of the G-DRG system.
Hospital treatments in Germany are reimbursed by SHI funds through the G-DRG system. The German DRG, or G-DRG, dictates a flat fee for reimbursement based on the diagnosis for each admitted case. This flat G-DRG fee also includes the costs for drugs and medical devices.
The study assessed the German inpatient sector from 1995 to 2015. The authors compared the situation in Germany before and after the introduction of the DRG, as well as in comparison to other OECD countries.
Type of study
It was the first study that assessed the causal aspects of the DRG. The DRG system has been claimed to bring multiple benefits to the outpatient sector. However, they hadn’t properly been investigated, since there was no control group of hospitals that wasn’t using the DRG system.
Instead, in this study, the authors formed several control groups based on data from other OECD countries that do not use the DRG system or only introduced it later.
Effects of the G-DRG
It showed that introducing the DRG into German hospitals increased case numbers. These increased by about 2% per year, and 20% over the observation period.
On the other hand, the DRG system didn’t lead to a reduction in the duration of hospitalization. While there was a reduction in absolute numbers on the duration of hospitalization, but this was the same as seen in other OECD countries. Thus, the authors concluded that this reduction was not caused by the DRG system but by medical innovations, such as minimally invasive procedures.
Unfortunately, the quality of patient care could not be assessed in the study, because the data from other countries were not sufficient.
However, it became apparent that in Germany case numbers are incentivised instead of the quality of care.
This would be possible by offering surcharges for complying with certain structural requirements, while hospitals that do not meet the relevant requirements would have to accept deductions or receive no remuneration for the corresponding cases.
The government had previously already introduced mandatory structural checks by the “medical services” (German: Medizinischer Dienst), but financial incentives are missing.
The authors also noted that in other countries, there is a strong trend to expand outpatient care. Outpatient procedures require significantly fewer staff without reducing the quality of care. However, this is not incentivised by the DRG.
Instead, this could be achieved with sector-equal remuneration – also known under the name “Hybrid-DRGs”.
Further reading related to the G-DRG
- How much does a certain treatment cost in Germany? – What you need to know
- New government coalition plans AMNOG, pricing and other reforms
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