China to promote medical insurance payment based on diagnosis related groups

BEIJING - China will launch a pilot program of diagnosis-related groups (DRGs), a patient classification to standardize medical insurance payment, in 30 cities, according to a circular issued by the National Healthcare Security Administration, the People's Daily reported Tuesday.

Patients will be classified into DRGs with similar clinical symptoms and resource costs on the basis of their age, gender, length of stay and clinical diagnosis. Medical fees and insurance payments will thus be based on DRG classification instead of specific patients.

The pilot cities, including Beijing, Tianjin and Handan in northern China's Hebei province, are set to start the new payment mode in 2021 before a simulated run in 2020, said the newspaper.

DRG payment is beneficial to standardize diagnosis and treatment and improve the efficiency of medical insurance fund use, according to Shen Shuguang, vice president of the China Association of Social Security.

Under the traditional payment model where patients pay for the medical examinations or treatment services before having the fees reimbursed, doctors may provide unnecessary medical services, which cost more and lead to higher medical costs.