DRG implementation in Estonian health care model – hospital perspective Teele Orgse 4th Nordic Casemix Conference June 4th 2010 Helsinki

The Republic of Estonia Parliamentary republic, president elected for 5 years (Mr. Toomas Hendrik Ilves) Official language – Estonian Coastline – 3794 km with 1521 islands Total area – km2 Population – (Estonians 65%, Russians 28%, Ukrainians 3%, Belorussians 1%, Finns 1%, other 2%) Independent since , occupied by the Soviet Union 1940, regained the independence on Member of the European Union since May 1st We have been here since 6500 BC!

Background – Soviet heritage Centralized state-controlled over-capacitated provider network (120 hospitals with beds) Polyclinics budget financed

Background - reforms Began in the end of 1980s Economic collapse, high inflation and political clutter – the aim was: –to improve the efficiency and quality of health care system –to meet the needs of a small country and its population Decentralization of primary and hospital care to local administrative level Elimination of special systems Separation of powers January 1st 1992: Health Insurance Law –From tax-based to insurance-based Hospital network reorganization Health care providers – operating under private law

Hospital Master Plan Regionalism Golden Circle

Financing

Contracting Need assessment Quarterly assessment Designing of budget Contracting 4-year financial prognosis The most cost-efficient system in Europe because of the contracting system. The supreme winner in the 2007 and 2008 BFB (bang-for-the- buck) scores (Euro Health Consumer Index 2008 report).

Contract

Health care services list Calculated by the EHIF, consulted with specialists and hospitals Over 130 pages Lists every detailed service – coded + priced

The BILL Fee-for-service: –Service + service + service = € € € Hospitals analyse and manage contracts Capped contracts

DRG-s in Estonia Implemented in 2004 There were a few articles about what DRGs are (Habicht) Some presentations “Somehow infiltrated” Starting from 10%/90% to 70%/30% today

The BILL Fee-for-service: –Service + service + service = € € € Hospitals analyse and manage contracts Capped contracts Bill = services 30% + DRG price 70%

Conclusion? Confusion Loss of transparency

Hospital “study” 2 hospitals regularly analyze the impact of DRGs 1 hospital uses special program – Datawell Visual DRG Pro 7 years after implementation basic calculation principles still need to be introduced EHIF finances over 90% of the hospital budget –Pärnu Hospital 10,2 M € (45%) –70% 7,1M €

Correcting Is labour with suturation still labour or is it a complication? Is a chronically ill heart failure patient a heart failure patient or a patient with heart rhytm problems? Is stenocardia the main problem or is morbus ischaemicus cordis?

Classification Official guidelines: –Gynecology and obstetrics 2005 –Hematology 2006 ICD-10 –Doctors education –“Most resourceful diagnose” Better statistics if dealth with

Case study - Pärnu Hospital Around bills that concern DRG –2 300 don’t classify –Over 50% of bills are covered by 22 DRGs

Are prices fair? 2005 – % 2006 – % 2007 – % 2008 – % %

DRG DRG billing in infectious diseases department always negative DRG 182 one of the most usual (1-3) – cases - negative financial aspect EEK - negative 19 - positive 23 Negative in cases with over 5 days admission

DRG DRG billing in orthopedics department always negative DRG 225 one of the most usual (4-5) – cases - negative financial aspect EEK - negative 13 - positive 3 Negative in higher class operations

Conclusion DRGs are part of hospital financing system Hospitals don’t have resources or will or know-how or a reason to analyze Made the system less transparent There is so much information that could be used and we are moving towards that

Tervist!