The impacts of diagnosis-intervention packet payment on the providers’ behavior of inpatient care—evidence from a national pilot city in China

Background: In 2020, the Chinese government developed and implemented an innovative case-based payment method under the regional global budget called the diagnosis-intervention packet (DIP) payment to pay for inpatient care. This study aims to assess the changes to inpatient care provision in hospitals after the DIP payment reform was implemented.

Methods: This study used inpatient medical costs per case, the proportion of the out-of-pocket (OOP) expenditure in inpatient medical costs, and the average length of stay (LOS) of inpatient care as outcome variables, and conducted an interrupted time series analysis to evaluate changes after the DIP payment reform. January 2021 was taken as the intervention point when a national pilot city of the DIP payment reform in the Shandong province began using the DIP payment to pay for inpatient care of secondary and tertiary hospitals. The data used in this study were obtained from the aggregated monthly claim data of inpatient care of secondary and tertiary hospitals.

Results: Compared to the pre-intervention trend, the inpatient medical costs per case, the proportion of the OOP expenditure in inpatient medical costs both in tertiary and secondary hospitals significantly decreased after the intervention. After the intervention, the reduction in the inpatient medical costs per case, the proportion of the OOP expenditure in inpatient medical costs in tertiary hospital were both higher than those in secondary hospital (p < 0.001). The average LOS of inpatient care in secondary hospital significantly increased after the intervention, and it immediately increase 0.44 day after intervention (p = 0.211). Moreover, the change of average LOS of inpatient care in secondary hospital after intervention was opposite to that in tertiary hospital, it had no statistical difference (p = 0.269).

Conclusion: In the short term, the DIP payment reform could not only effectively regulate provider behavior of inpatient care in hospitals, but also improves the rational allocation of the regional healthcare resources. However, the long-term effects of the DIP payment reform need to be investigated in the future.