The United States recently adopted an entirely new system of paying physicians for the services they provide to elderly and disabled patients. The new system is based on a fee schedule in which the relative values among different services are derived on the basis of the cost of providing such services. To control expenditure growth, a system of Volume Performance Standards (VPSs) was adopted, which explicitly links physician fee levels to the success the physician community has in controlling the total volume of services provided. This article presents and analyzes the new payment system and examines its applicability to other countries. It concludes that the methodology used to develop the fee schedule may be useful to other countries, particularly if they are unable to reach a consensus on appropriate physician fee levels, but that the VPS system needs to be refined in a number of ways before it can be successfully exported.
*Fee Schedules/legislation & jurisprudence ; Medicare Part B/*organization & administration ; Reimbursement Mechanisms ; *Relative Value Scales ; United States

PURPOSE: This study focused on analysing costs per home health care nursing visit based on home health care nursing activities in medical institutes. METHOD: The data was collected in three stages. First, the cost elements of home health care nursing services were collected and 31 home care nurses participated. Second, the workload and caseload of home care nursing activities were measured by the Easley-Storfjell Instrument(1997). Third, the opinions on improving the home health care nursing reimbursement system were collected by a nation-wide mailing survey from a total of 125 home care agencies. RESULT: The cost of home health care nursing per visit was calculated as 50,626 won. This was composed of a basic visiting fee of 35,090 won (about 35 dollars) and travel fee of 15,536 won (about 15 dollars). The major problems of the home care nursing payment system were the low level of the cost per visit, no distinction between first visit and revisits, and the limitations in health insurance coverage for home health care nursing services. CONCLUSION: This study's results will contribute as a baseline for establishing policies for improvement of the home health care nursing cost and for applying a community-based visiting nursing service cost.
Home Care Services/*economics ; Humans ; Nursing Services/*economics ; *Reimbursement Mechanisms

Strengthening primary care has always been a major policy issue in most developed countries to achieve the health care system's goals, and policy makers continuously try to use payment system as an effective tool to improve overall performance of primary care. In this paper, we examined the various payment methods and growing trends in primary care payment system in some developed countries. Overall, a common form of payment for primary care doctors is a blend of fee-for-service (FFS), capitation, and pay-for-performance (P4P). In addition, many countries are still in the way of many new trials to find the right way to provide primary care service effectively, to meet the complex health care needs of populations. In Korea, primary care system is not well-established, and other institutional arrangements are not in good conditions for primary care, either. FFS, which is a dominant payment method in Korea, is not favorable for achieving good attributes of primary care. Mixing various payment components, like capitation, P4P to current FFS is essential to provide the optimal incentive structures for primary care physicians. Also, new models to encourage doctor-patient relationships with appropriate P4P mechanisms could be used as an early step in reforming primary care payment system gradually.
Administrative Personnel ; Delivery of Health Care ; Developed Countries ; Fee-for-Service Plans ; Humans ; Korea ; Motivation ; Physicians, Primary Care ; Primary Health Care ; Reimbursement, Incentive

Whether or not insurance covers new health technology has a great effect on the extent of its acceptance and diffusion. Thus many stakeholders vie to participate in determining insurance reimbursement regulations. This paper explains the process by which new health care technology is added to the coverage list in the Republic of Korea,with each checkpoint explained. Our paper also argues that the implication of the listing process of Korean insurance coverage should be modified in the area such as what is the principle of insurance coverage and who will decide the acceptance criteria of health technology, safety, effectiveness, economic feasibility, and relative value.
Biomedical Technology* ; Diffusion ; Insurance ; Insurance Coverage* ; Reimbursement Mechanisms ; Social Control, Formal

Background: The Universal Health Care Law seeks to optimize financing of personnel costs without compromising quality and equitable health care among the health care facilities. This position statement aimed to identify strategies and policy recommendations for the cost-effective financing of health personnel in public healthcare facilities. Methods: A systematic review of literature was done to generate policy brief and key points for roundtable discussion in collaboration with the Department of Health (DOH). The discussion was guided by the three health financing options of DOH: (a) retain Personnel Services (PS) as DOH budget but shift Maintenance and Other Operating Expenses (MOOE) to PhilHealth; (b) shift PS and MOOE to PhilHealth, and (c) rationalize part-time status in government hospitals. Results: The pros and cons of financing options were cross-examined. In Option 1, physicians in government hospitals would receive fixed salaries from DOH / Local Government Units. In Option 2, there would be a monopsony between PhilHealth and provincial power. Payment will be performance-driven, and balance billing will be eliminated. Option 3 would be a set up of retaining part-time positions for physicians. Conclusion and Recommendation Participants deduced that for Option 1, provision of salary augmentation sources and ensuring adequate plantilla items and level of remuneration in government hospitals should be considered, in order to sufficiently compete with physicians’ income from private practice. For Option 2, the PhilHealth reimbursement system should ensure timely reimbursement so as not to subject care providers to financial instabilities. For Option 3, rationalizing part-time status should be flexible and can be applied regardless of how physicians are paid, as this would incentivize caregivers to work harder and smarter.
Universal Health Insurance ; Healthcare Financing ; Physicians ; Universal Health Care ; Reimbursement Mechanisms

Medical insurance, which is mandatory in Korea, has been progressed in the way of expanding the relevant population and intensifying the guarantee. However, rapid increases in medical expenses led national health insurance into a state of financial crisis. The government considered the reason of financial crisis as fee-for-service and started reorganizing the terms of payment from fee-for-service to case-payment. Therefore, an expanded diagnosis related group (DRG) payment system is carried out to decrease the expense on health and to secure financial stability. At the same time, the new case-payment system, apposite to the medical case in Korean society, is under demonstration. DRG payment system is in execution for the 7 disease entities of the four departments requested for now. However, it is supposed to be carried out in all the hospitals from the second half of 2012 and be expanded to all the general hospitals from 2013. The new case-payment system is under development because it is difficult to apply DRG to all disease entities. These shake-ups in the payment system will be conducted from the year 2015, combining both the DRG and new case-payment system. Basically, the introduction of the new case-payment system will cause doctors' passive attitude in the treatment of patients. This would be an especially serious problem for the department of surgery whose charge for operation is very low. It would be worse for the vascular surgeons because only 80% of operational or interventional procedures will be compensated, the fee for ultrasound is included in the new case-payment system, and age-related severity is not reflected in the disease entity. If relaunch is inevitable, vascular surgeons should understand the new case-payment system exactly and point out the problems. Also, standard guidelines on treatment per procedure should be set up and used for the established case-payment system, which would be helpful in reducing unnecessary medical expenses.
Diagnosis-Related Groups ; Fee-for-Service Plans ; Fees and Charges ; Hospitals, General ; Humans ; Insurance ; Korea ; National Health Programs

The fee-for-service system is used as the main payment system for health care providers in Korea. It has been argued that it can't reflect differences in the medical practice costs across regions because the fee schedule is calculated based on the average cost. So, some researchers and providers have disputed that there is need for adopting geographic practice cost index (GPCI) used in the United States for the Medicare program for the elderly to the fee-for-service payment system. This study performed to identify whether the difference in the practice costs among regions exists or not and to examine the feasibility of applying GPCI to Korea payment system. For this purpose, we calculated modified-GPCI and examined considerations to introduce GPCI in Korea. First we identified available data to calculate GPCI. Second, we made applicable GPCI equations to Korea payment system and computed it based on four types of regions (metropolitan, urban, suburban, and rural). We also categorize the regions based on the availability of the medical resources and the capability of utilizing them. As a result, we found that there wasn't any significant difference in the GPCI by regional types in general, but the indices of rural areas (0.91–0.98) was relatively low compared to the indices of other regions (0.96–1.07). Considering the need to use GPCI floor, the pros and cons of using GPCI, and the concern of the regional imbalance of resources, the introduction of GPCI needs to be carefully considered.
Aged ; Fee Schedules ; Fee-for-Service Plans ; Health Personnel ; Humans ; Korea ; Medicare ; Relative Value Scales ; United States

BACKGROUND AND OBJECTIVES: The Korean National Health Insurance is based on 'fee for service' system, but recently 7 groups of diseases were forcibly applied to diagnosis related groups (DRG) system. In these 7 group of diseases, tonsillectomy and adenoidectomy were included in the otorhinolaryngology field. The objective of this research is to estimate the invested medical costs, profit and loss, and improvement points for the disease groups according to DRG and 'fee for service' system. SUBJECTS AND METHOD: We investigated 1,377 subjects who underwent tonsillectomy and adenoidectomy based on DRG between January 2011 to December 2013 at our hospital. The profit and loss of medical costs were calculated according to medical record data, medical service fee, and activity based costing (ABC). RESULTS: The total of 1,377 subject comprised of 905 patients younger than 17 years-old and 472 patients older than 18 years-old. A main moderate complication that was not one of the DRG diseases, postoperative bleeding, was only found in 19 patients (1.38%). Profit related to tonsillectomy and adenoidectomy studied for a 3 year-period was higher in the DRG system than in the 'fee for service' system; however, profit was reported as 62.9-67.5% of the actual prime costs. CONCLUSION: DRG system for tonsillectomy and adenoidectomy seems to have higher compensation rate than the 'fee for service' system does. However, the system is still insufficient to compare profit with the input medical cost. Furthermore, the present system of disease grouping needs to be improved to reflect actual medical prime costs.
Adenoidectomy* ; Compensation and Redress ; Diagnosis-Related Groups ; Fee-for-Service Plans ; Fees and Charges ; Hemorrhage ; Humans ; Medical Records ; National Health Programs ; Otolaryngology ; Tonsillectomy*

OBJECTIVES: The Diagnosis Related Group (DRG) payment system, which has been implemented in Korea since 1997, is based on voluntary participation. Hence, the positive impact of this system depends on the participation of physicians. This study examined the factors determining participation of Korean obstetrics & gynecology (OBGYN) clinics in the DRG-based payment system. METHODS: The demographic information, practice-related variables of OBGYN clinics and participation information in the DRG-based payment system were acquired from the nationwide data from 2002 to 2007 produced by the National Health Insurance Corporation and the Health Insurance Review & Assessment Service. The subjects were 336 OBGYN clinics consisting of 43 DRG clinics that had maintained their participation in 2003-2007 and 293 no-DRG (fee-for-service) clinics that had never been a DRG clinic during the same period. Logistic regression analysis was carried out to determine the factors associated with the participation of OBGYN clinics in the DRG-based payment system. RESULTS: The factors affecting participation of OBGYN clinics in the DRG-based payment system were as follows (p<0.05): (1) a larger number of caesarian section (c/sec) claims, (2) higher cost of a c/sec, (3) less variation in the price of a c/sec, (4) fewer days of admission for a c/sec, and (5) younger pregnant women undergoing a c/sec. CONCLUSIONS: These results suggest that OBGYN clinics with an economic practice pattern under a fee-for-service system are more likely to participate in the DRG-based payment system. Therefore, to ensure adequate participation of physicians, a payment system with a stronger financial incentive might be more suitable in Korea.
Adult ; Age Factors ; Ambulatory Care Facilities/economics/*statistics & numerical data ; Cesarean Section/statistics & numerical data ; Costs and Cost Analysis/statistics & numerical data ; Demography ; Diagnosis-Related Groups/economics/*statistics & numerical data ; Fee-for-Service Plans/statistics & numerical data ; Female ; Gynecology ; Humans ; Length of Stay/statistics & numerical data ; Logistic Models ; Male ; Middle Aged ; Obstetrics ; Pregnancy ; *Prospective Payment System ; Republic of Korea ; State Medicine/economics/*statistics & numerical data

The purpose of this study was to examine the trends of length of hospital stay (LOS), which is most likely to be a major attribute to hospital performance From 1984 to 1994, an average LOS of each hospital was analyzed by factors such as medical departments, bed size, occupancy rate, region and ownership. This study was analyzed changing rate of LOS during 11 years. This rate was calculated by simple regression, which was used only with hospital without missing data during 11 years. This study findings are as follows. 1. The results indicated that the average LOS was steadily increased until 1990 but it was slightly decreased after 1990. 2. This trend could be found in all hospital scale and all group of occupancy rate. Specifically this trends of LOS were found in internal medicine, corporate owned hospitals, and hospitals in major city. But LOS of individual owned hospital was continuously increased until 1994. 3. Means of changing rates of LOS were calculated from 1984 to 1994. If we divided it into two parts, before 1990 and after 1990, most changing rates of LOS before 1990 except individual owned hospital were found positive sign. The changing rates after 1990 were negative sign but small hospital(lesser then 200 bed), individual owned hospital, national & public hospital and hospital in small urban have little change of LOS after 1990. Finally from this results we thought that most hospitals in korea began to be concerned with LOS. Nevertheless LOS of several hospital such as small hospital or individual owned hospital was increased. And this trend may be caused by a few patients, low occupancy rate, or low profit. This trend of LOS is different from that of other countries. Perhaps this phenomenon is resulted from the reimbursement method. Because of fee for service reimbursement system in korea the hospitals didn't need to shorten LOS in order to save the cost and increase the profit. Therefore reform of hospital cost reimbursement method will be reduced to reduce hospital cost in korea. we thought that the korean health authority should consider the reimbursement method by unit of bundle of services, for example DRG and prepayment in the united states. This study presents some limitations such as on insight of severity of disease, case-mix measurement of hospital, and other clinical characteristics that can possibly affect LOS, However, this study reports an important trend in LOS from 1984 to 1994.
Diagnosis-Related Groups ; Fee-for-Service Plans ; Hospital Bed Capacity ; Hospital Costs ; Hospitals, Public ; Humans ; Internal Medicine ; Korea* ; Length of Stay* ; Ownership ; United States