The long-run effects of diagnosis related group payment on hospital lengths of stay in a publicly funded health care system: Evidence from 15 years of micro data

María José Aragón; Martin Chalkley; Noémi Kreif

doi:10.1002/hec.4479

The long-run effects of diagnosis related group payment on hospital lengths of stay in a publicly funded health care system: Evidence from 15 years of micro data

María José Aragón, Martin Chalkley, Noémi Kreif

Centre for Health Economics

Research output: Contribution to journal › Article › peer-review

Abstract

Diagnosis Related Group (DRG) payment systems are a common means of paying for hospital services. They reward greater activity and therefore potentially encourage more rapid treatment. This paper uses 15 years of administrative data to examine the impact of a DRG system introduced in England on hospital lengths of stay. We utilize different econometric models, exploiting within and cross jurisdiction variation, to identify policy effects, finding that the reduction of lengths of stay was greater than previously estimated and grew over time. This constitutes new and important evidence of the ability of financing reform to generate substantial and persistent change in healthcare delivery.

Original language	English
Pages (from-to)	956-972
Journal	Health Economics
Volume	31
Issue number	6
DOIs	https://doi.org/10.1002/hec.4479
Publication status	Published - 2 Mar 2022

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Health Economics - 2022 - Arag n - The long‐run effects of diagnosis related group payment on hospital lengths of stay in a
© 2022 The Authors. Health Economics published by John Wiley & Sons Ltd.
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Cite this

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abstract = "Diagnosis Related Group (DRG) payment systems are a common means of paying for hospital services. They reward greater activity and therefore potentially encourage more rapid treatment. This paper uses 15 years of administrative data to examine the impact of a DRG system introduced in England on hospital lengths of stay. We utilize different econometric models, exploiting within and cross jurisdiction variation, to identify policy effects, finding that the reduction of lengths of stay was greater than previously estimated and grew over time. This constitutes new and important evidence of the ability of financing reform to generate substantial and persistent change in healthcare delivery.",

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