Taiwan’s Bureau of National Health Insurance (BNHI) plans to change its payment system to a Diagnosis-Related Group (DRG) system in the next year. By establishing this DRG system, the BNHI hopes to decrease waste and improve hospital efficiency.
A DRG system means fixed payment, where the BNHI will fix the payment price for each disease requiring in-hospital care. Even if a hospital’s actual cost of treatment is less than the set price, the hospital could still receive the full payment from the Taiwanese government. BNHI hopes that with this new payment scheme, it can encourage hospitals to be more efficient and improve care to patients as the hospital keeps any extra money.
However, there are concerns that a DRG system may affect patients with severe conditions negatively as the cost for treatment can be very high. Those who are terminally ill or with chronic conditions may also suffer under this new payment system with price ceilings.
The BNHI has stated that the DRG system will not be applied for treatments for AIDS, rare diseases, cancer, hemophilia and mental illnesses. Children will be given preferential payments, and hospitals will receive an 8.9% bonus for taking in patients with more serious conditions.
The DRG system is to cover 182 diseases and conditions, including areas in dermatology, urology, renal, ENT, oral cavity, multiple traumatic injuries, subcutaneous tissue or breast. It is estimated that over 400,000 patients will be affected with this new payment system.