By the same authors

From the same journal

From the same journal

How should hospital reimbursement be refined to supportconcentration of complex care services?

Research output: Contribution to journalArticlepeer-review



Publication details

JournalHealth Economics
DateAccepted/In press - 12 Apr 2017
DateE-pub ahead of print (current) - 17 May 2017
Number of pages13
Early online date17/05/17
Original languageEnglish


The English National Health Service is promoting concentration of the treatment of patients with relatively rare and complex conditions into a limited number of specialist centres. If these patients are more costly to treat, the prospective payment system based on Healthcare Resource Groups (HRGs) may need refinement because these centres will be financially disadvantaged. To assess the funding implications of this concentration policy, we estimate the cost differentials associated with caring for patients that receive complex care and examine the extent to which complex care services are concentrated across hospitals and HRGs. We estimate random effects models using patient-level activity and cost data for all patients admitted to English hospitals during the 2013/14 financial year and construct measures of the concentration of complex services. Payments for complex care services need to be adjusted if they have large cost differentials and if provision is concentrated within a few hospitals. Payments can be adjusted either by refining HRGs or making top-up payments to HRG prices. HRG refinement is preferred to top-payments the greater the concentration of services among HRGs.

Bibliographical note

© 2017 The Authors Health Economics

    Research areas

  • complex care service, diagnosis related groups, healthcare resource groups, hospital payment

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