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Managerial workarounds in three European DRG systems.

Rod Sheaff1, Verdiana Morando2,3, Naomi Chambers4

  • 1School of Law, Criminology and Government, Plymouth University, Plymouth, UK.

Journal of Health Organization and Management
|May 5, 2020
PubMed
Summary
This summary is machine-generated.

Managers developed workarounds in Diagnosis Related Group (DRG) payment systems to control healthcare costs. These "constructive deviance" strategies helped mitigate financial risks associated with DRG incentives in hospitals.

Keywords:
DRGDiagnostic related groupEnglandGermanyItalyManagerial workaround

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Area of Science:

  • Health policy and management
  • Healthcare economics
  • Health systems research

Background:

  • Health system transformation often involves implementing Diagnosis Related Group (DRG) payment systems.
  • Managerial workarounds, adaptations made by managers to navigate system constraints, are common but under-analyzed.
  • Understanding these workarounds is crucial for evaluating the success of health system reforms.

Purpose of the Study:

  • To conceptualize and analyze managerial workarounds within hospital DRG payment systems.
  • To extend existing knowledge on clinical and IT workarounds to the managerial domain.
  • To compare the management of DRG systems and associated workarounds in England, Germany, and Italy.

Main Methods:

  • A qualitative comparative case study approach was employed.
  • Data were collected through 154 key informant interviews and analysis of 111 policy documents.
  • The study involved an action learning set and follow-up data collection in 2018-19.

Main Results:

  • Managers in England, Germany, and Italy developed similar workarounds to contain healthcare costs.
  • Strategies included lowering DRG payments above a caseload ceiling and reducing payments below a volume floor.
  • These workarounds aimed to mitigate the financial consequences of DRG incentives for payers.

Conclusions:

  • Managerial workarounds in DRG systems can be viewed as 'constructive deviance,' enabling financial risk reduction.
  • The concept of managerial workarounds offers a nuanced perspective on health system transformation failures or partial successes.
  • The findings have implications for understanding and managing health systems and potentially other sectors like education and social care.