Related Experiment Video
Updated: May 22, 2026
Evaluation of a Point-of-Care Testing Analyzer for Measuring Peripheral Blood Leukocytes
Published on: March 22, 2022
DRG payment, financial signals, and low-value hospitalizations in China
Lixiang Wu1, Ni Wu2, Lihong Lin1
1The Quzhou Affiliated Hospital of Wenzhou Medical University, Quzhou People's Hospital, Quzhou, China.
Objective:
To examine whether China's Diagnosis-Related Group (DRG) payment reform is associated with low-value inpatient admissions-defined as entire hospitalizations of questionable necessity-and to identify the primary drivers of this type of care.
Methods:
We developed a new rule to identify low-value admissions using claims data, synthesizing international standards and Chinese health policies. We conducted a analysis of all DRG payment records (2022-2024, N = 251,811) from a large tertiary hospital in a region that adopted the reform early. A multilevel mixed-effects logistic regression model was applied, with the DRG Medical Expense Ratio (DER)-a measure of profitability at the case level-as the key explanatory variable.
Results:
The overall incidence of low-value hospitalizations was 4.86% and rose by 76.5% from 2022 to 2024, resulting in insurance expenditures of 51.23 million Chinese Yuan. Admissions with the highest profit margins (low DER) were significantly more likely to be low-value (high vs. low DER: OR = 0.056). By 2024, 80.74% of low-value cases were classified as "check-up dominated" admissions.
Conclusion:
Within the DRG payment environment in China, the financial incentives created by the reform are associated with hospitals admitting patients for low-value, low-complexity care, effectively shifting rather than eliminating waste in the healthcare system.
Related Concept Videos
01:29Issues And Trends In Healthcare Delivery System
Cost Containment
Payment for healthcare services has historically promoted adoption of costly and often unnecessary or inefficient...
01:30Health Information Technology and Healthcare Information System
Health Information Technology, commonly called HIT, integrates advanced information systems and technology in healthcare settings. Its primary functions include:
01:26Methods Of Healthcare Delivery System
Managed Care System:
The managed care system is designed to control the cost while maintaining the quality of care. The patient's care from admission to discharge is planned by the primary care provider or the case manager, also known as the gatekeeper. In a managed care system, the number of care providers is limited...