Which is traditional fee for service health insurance that covers a portion of services

Healthcare Benefit Management

• Medical Fees
• Drug Price
• Medical Material Price
• Workforces Facilities and Device
• Evidence-Based Healthcare
• New Health Technology
• Diagnosis-Related Group Payment

Diagnosis-Related Group Payment

The DRG payment system reimburses inpatient care fees using a DRG classification system. In this system, all hospitalized patients are classified by DRG. In order to categorize patients, attention is paid to their consumption of medical resources, clinical symptoms, diagnosis, surgery, age, etc. When a patient is hospitalized, a fixed amount of medical fee is reimbursed depending on which disease the patient has. This fee is reimbursed regardless of the type or amount of medical services, such as examination, surgery or medication, which are provided during hospitalization. As the reimbursed amount is fixed in advance, it is likely that healthcare input will be reduced, in order to increase the profit of the healthcare institution. This may lead to more efficient provision of services. The DRG system contrasts with the traditional “Fee-for-Service” payment system, in that the cost of the service provided is not part of the fee calculation, as the medical fee is reimbursed regardless of the medical services provided.

Brief History

A pilot program of the DRG payment system was implemented from February 1997 to December 2001. The expanded main program was implemented from January 2002, on a voluntary basis.

• Number of Healthcare Institutions Participating in the DRG Payment System

  Classification	Total	Tertiary Hospitals	General Hospitals	Hospitals	Clinics
  2008	number of institutions	2,365	1	93	189	2,082
  participation rate, %	69.6	2.3	34.6	40.8	79.3
  2009	number of institutions	2,283	-	77	175	2,031
  participation rate, %	68.0	-	28.6	38.8	78.3
  2010	number of institutions	2,325	-	75	174	2,076
  participation rate, %	69.9	-	27.4	39.2	80.9
  2011	number of institutions	2,347	-	68	183	2,096
  participation rate, %	71.5	-	24.7	40.5	83.5
  2012	number of institutions	2,635	-	39	415	2,181
  participation rate, %	92.4	-	16.3	100.0	100.0

Diagnosis-Related Groups

The DRG payment system is applied to the inpatients classified into seven disease groups, within four medical departments. The system also applies in outpatient surgery such as lens procedures inguinal and femoral hernia procedure and simple anal procedure.

• Seven Diagnosis-Related Groups

  Classification	Ophthalmology	ENT	General Surgery	OB/GYN
  DRGs	Lens procedures	Tonsillectomy & adenoidectomy	Appendectomy Inguinal & femoral hernia procedures Anal & perianal procedures	Uterine & adnexal procedures for non-malignancy Caesarean section delivery

• Fee schedule and Scope: Taking into account diagnosis and institution type, the average amount paid under the fee-for-service system and part of the amount paid by patients for non-covered services are included in the DRG fee schedule as an incentive.
• Therefore, most costs of medical services, medical materials and drugs needed in treatment are covered under the DRG system. The DRG system also covers the costs caused by complications due to surgery or pre-existing conditions.
• However, some designated items are excluded from DRG coverage. These items include costs for which the patient takes full responsibility (e.g. transportation expenses, patient controlled analgesia after surgery) and uncovered items (e.g. the cost difference for choosing better hospital rooms, selective medical service fees, aesthetic plastic surgery, ultrasonography, etc.).

Monitoring

Monitoring is conducted to ensure appropriate quality of medical services and to minimize the negative aspects of the DRG payment system, such as misuses of diagnosis classification information and claim fraud (e.g. DRG upcoding/splitting claim, premature discharge from hospital).>

Which is an example of a fee for a service?

Where do the fees for service rendered come from?

What is a plan type?

Which type of insurance is defined as reimbursement for income lost as a result of a temporary?