1. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement Price and Volume Measures of Hospital Services for Germany developed by Stefan Pierdzioch presented by Liane Ritter Federal Statistical Office, Germany OECD Working Party on National Accounts in Paris, 14 - 16 October 2008

2. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 2 Content DRG-based funding system for hospitals Method for price and volume measures Results

3. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 3 Funding System Based on diagnostic related groups (DRGs) From 2004 for all hospital services (except psychiatric and rehabilitation hospitals) 2006: 912 DRGs; 2007: 1082 DRGs 27 major diagnostic categories (MDCs) DRG-dataset from 2005 Number of treatments Cost weights Revenues Base rates Reference price a hospital charges for an average DRG

4. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 4 Major diagnostic categories 2006 MDCMajor diagnostic categories Number of DRGs Share of treatments MDC 05Diseases and disorders of the circulatory system 10915.5% MDC 08Diseases and disorders of the musculo- skeletal system and connective tissues 10514.3% MDC 06Diseases and disorders of the digestive system 5912.8% …… MDC 15Newborn424.0% …… Total912100%

5. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 5 Example: B75A Febrile seizures, age of patient < 1 year DRG B75A DRG-Code Major diagnosis category MDC 01 diseases and disorders of the nervous system diagnosisEconomic complexity of the diagnosis (A – I; Z)

6. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 6 Price of a complete treatment (1) Cost weights for DRGs Example: DRG B75A: 0.531 Between 0.106 and 64.899 Valid for one calendar year Published three months before the reference year Base rate (Insurance company) Negotiated between hospitals and health insurances Up to 2008: by hospitals; from 2009: by regions (Länder) Actually paid base rate change during the year Neglected Extra payments Supplements for facultative services

7. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 7 Price of a complete treatment (2) Calculated DRG-revenues for treatments Price of a treatment = cost weight x base rate Example: DRG B75A in hospital x Cost weight: 0.531 Base rate: 2800 Euros Price of one treatment febrile seizures, age of patient < 1 year = 0.531 x 2800 Euros = 1487 Euros DRG-revenues from the DRG-dataset not used Small difference, yearly, too late

8. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 8 Method (1) Deflation Weighting price developments with the number of treatments Market production Stratification By 27 major diagnostic groups (MDCs) No problems of regrouping Stability of the structure Weights: treatments MDCs From DRG-dataset Only yearly data Nine months after the end of the reference year Prices: average revenues per treatment for MDCs Average base rates for all hospitals Average cost weights for MDCs

9. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 9 Method (2) Average cost weight for a MDC Average price for a MDC = average cost weight for the MDG x average base rate Development of the average prices for MDC Weighted by the number of treatments for the reference year

10. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 10 Results (1) Quarterly price change for hospital services Quarter on quarter comparison, percentage

11. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 11 Results (2) YearValuePriceVolume 20062.81.81.0 2007…-2.3… Development of hospital services Year on year comparison, percentage

12. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement 08.02.2014 Folie 12 Conclusion From 2005 price and volume measures for hospitals (except psychiatric and rehabilitation hospitals) is based on DRG-data Method: deflation and not volume measure Data earlier available Quarterly accounts possible Stratification: 27 major diagnostic categories (MDC) Weights: Number of treatments for each MDC (yearly) Price development: calculated average prices for MDC (yearly, quarterly) Influence of about 1000 DRGs - number of treatments - cost weights Change of hospitals reference prices (base rate)

13. © Statistisches Bundesamt (Federal Statistical Office, Germany), Price and volume measurement Thank you for your attention Liane Ritter Statistisches Bundesamt, Wiesbaden Phone: +49 (0)611 / 75-2270 E-mail: liane.ritter@destatis.de