Medicare's DRG-weights in a European environment: the Spanish experience

Hospital payment systems are being changed to mixed systems, composed of case-mix categories and structure indicators. The Health Care Financing Administration's Diagnosis-Related-Groups (HCFA's DRG-weights are used in Catalonia as Prospective Payment System (PPS)-instruments for hospital inpatient reimbursement. The Catalonian and Spanish health systems, however, are very different from the US health environment. The aim of this study is to determine whether the HCFA's DRG-weights fit the special characteristics of a European environment. To do this, cost-based weights, determined from information from the cost accounting system of two public hospitals in Barcelona, are compared with Medicare-weights. A total of 35 262 discharges representing 12 794 million pesetas are analyzed. Medicare-weights do not differ globally from cost-based-weights and the adjusted correlation weighted least squares regression between the two weight-scales is 95%. There are, however, systematic deviations in six DRG-groupings. The most important deviations are concentrated in Ambulatory Surgery categories, in DRGs in which prostheses are used, and in specialties excluded from several PPSs because of extreme variables in treatment intensity. In conclusion, Medicare-weights can be used to pay hospital output in European environment but they should be adjusted to avoid systematic deviations.