Using computerised patient-level costing data for setting DRG weights: the Victorian (Australia) cost weight studies

Area of Science:

• Health economics
• Health services research
• Hospital management

Background:

• Casemix funding systems require accurate resource weights to avoid distorting patient care.
• Deriving empirical cost relativities is challenging due to limited cost data and high study expenses.
• Victoria's DRG-based payment system necessitates reliable resource weight estimation for inpatient care.

Purpose of the Study:

• To evaluate the use of hospital management information system data for estimating inpatient resource weights.
• To assess the feasibility and reliability of using clinical costing systems for cost weight derivation.
• To inform investment decisions in clinical costing technology by highlighting the utility of byproduct data.

Main Methods:

• A 5-year research program analyzing data from clinical costing systems.
• Description of international approaches to cost weight estimation.
• Comparison of process and job costing methods.
• Development and application of data validation and reliability testing techniques.
• Analysis of four Victorian Cost Weight Studies (1993-1998).

Main Results:

• Demonstrated improvement in sampling, data validity, and reliability over the research period.
• Highlighted the advantages of utilizing patient-level data.
• Confirmed the utility of byproduct data from clinical costing systems for resource weight estimation.
• Showcased advancements in data quality and consistency for healthcare payment systems.

Conclusions:

• Clinical costing systems can effectively generate data for estimating relative resource weights.
• The use of byproduct data offers a cost-effective method for informing health policy and payment systems.
• Investment in clinical costing technology is justified by its potential for accurate resource allocation and system efficiency.