Early results of pediatric appendicitis after adoption of diagnosis-related group-based payment system in South Korea

PURPOSE: As an alternative to the existing fee-for-service (FFS) system, a diagnosis-related group (DRG)-based payment system has been suggested. The aim of this study was to investigate the early results of pediatric appendicitis treatment under the DRG system, focusing on health care expenditure and quality of health care services. PATIENTS AND METHODS: The medical records of 60 patients, 30 patients before (FFS group), and 30 patients after adoption of the DRG system (DRG), were reviewed retrospectively. RESULTS: Mean hospital stay was shortened, but the complication and readmission rates did not worsen in the DRG. Overall health care expenditure and self-payment decreased from Korean Won (KRW) 2,499,935 and KRW 985,540, respectively, in the FFS group to KRW 2,386,552 and KRW 492,920, respectively, in the DRG. The insurer’s payment increased from KRW 1,514,395 in the FFS group to KRW 1,893,632 in the DRG. For patients in the DRG, calculation by the DRG system yielded greater overall expenditure (KRW 2,020,209 vs KRW 2,386,552) but lower self-payment (KRW 577,803 vs KRW 492,920) than calculation by the FFS system. CONCLUSION: The DRG system worked well in pediatric patients with acute appendicitis in terms of cost-effectiveness over the short term. The gradual burden on the national health insurance fund should be taken into consideration.