NHA launched Diagnosis Related Group pilot project in five states

The National Health Authority (NHA) of India has launched a new payment system for hospitals called Diagnosis Related Groups (DRG). DRG is a system that reimburses hospitals based on the severity of the patient’s illness and the resources required to treat them. This system is designed to improve the efficiency and quality of healthcare in India.

The National Health Authority (NHA) presented the launch of Diagnosis Related Group (DRG) in the Arogya Manthan workshop as part of the National Digital Health Mission. DRG is a cutting-edge system that uses patient classification data to reimburse hospitals based on the resources intensity required for the specific patient mix.

The DRG system is being piloted in five states:

• Chandigarh
• Haryana
• Maharashtra
• Kerala
• Meghalaya

The pilot projects will help the NHA to gather data and feedback that will be used to refine the DRG system before it is rolled out nationwide.

The DRG system has several advantages over the current fee-for-service system. First, it incentivizes hospitals to provide efficient and effective care. Second, it helps to reduce administrative costs by simplifying the billing process. Third, it makes it easier for patients to compare the cost of care at different hospitals.

The DRG system is a major step forward for the Indian healthcare system. It has the potential to improve the efficiency, quality, and affordability of care for all Indians.

Here are some of the specific benefits of DRG:

• Improved efficiency: DRG can help to improve efficiency in the healthcare system by reducing administrative costs and improving the coordination of care. For example, under the fee-for-service system, hospitals have an incentive to admit patients for longer periods of time, even if they are no longer sick. This can lead to unnecessary costs and complications. Under DRG, hospitals are reimbursed a fixed amount for each patient, regardless of the length of stay. This gives hospitals an incentive to discharge patients as soon as they are medically stable, which can save money and improve patient outcomes.
• Improved quality: DRG can help to improve quality by ensuring that patients receive the right care at the right time. Under the fee-for-service system, hospitals have an incentive to perform unnecessary tests and procedures. This can lead to complications and increased costs. Under DRG, hospitals are reimbursed a fixed amount for each patient, regardless of the number of tests or procedures performed. This gives hospitals an incentive to only perform the tests and procedures that are medically necessary, which can improve patient outcomes and reduce costs.
• Reduced costs: DRG can help to reduce costs by providing hospitals with incentives to provide efficient and effective care. Under the fee-for-service system, hospitals are reimbursed for each service they provide. This can lead to hospitals overcharging for services or providing unnecessary services. Under DRG, hospitals are reimbursed a fixed amount for each patient, regardless of the number of services they provide. This gives hospitals an incentive to provide efficient and effective care, which can save money.

The NHA is committed to implementing DRG in a way that benefits all stakeholders, including patients, providers, and payers. The pilot projects will help the NHA to gather data and feedback that will be used to refine the DRG system before it is rolled out nationwide. The implementation of DRG is a major step forward for the Indian healthcare system. It has the potential to improve efficiency, quality, and affordability of care for all Indians.