Managerial workarounds in three European DRG systems

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.