Recently, three departments in Foshan City, Guangdong Province—the Municipal Healthcare Security Bureau, the Municipal Health Bureau, and the Municipal Social Security Bureau—jointly issued a notice regarding the arrangements for DRG-based payment of inpatient medical expenses within the city for 2022, as well as the settlement of inpatient hospitalization groups for the employee maternity insurance.

Foshan is a major prefecture-level city in the Pearl River Delta, economically developed, with a population of nearly 10 million. The city's Foshan People's Hospital is a renowned top-tier tertiary hospital, and Foshan Traditional Chinese Medicine Hospital is particularly famous among TCM hospitals nationwide for its orthopedics department. Furthermore, some town-level hospitals in Nanhai and Shunde districts of Foshan are also considerable in scale; their medical resources and revenue are almost comparable to those of prefecture-level central hospitals in some central and western regions.

Within Guangdong Province, aside from Foshan and Shanwei, which implement DRG, the remaining 19 cities implement DIP payment.

Therefore, the arrangements made by Foshan City for DRG payment settlement issues in 2022 can be viewed as a sample of medical insurance payment reform in a developed prefecture-level city and are worth attention.

The "Notice" indicates that, in accordance with national DRG regulations and requirements, and under the premise of aligning with the core groupings of the national ADRG, Foshan has formed its CHS-DRG subgrouping plan (2022 version), which is divided into 848 groups.

DRG Separately Calculated Points:

High-Cost Dual-Channel Drugs, Drugs with Significant Impact on DRG Group Stability

The Pharmaceutical Cloud Workshop noticed that Foshan will separately calculate points for drugs and consumables that meet the scope of medical insurance payment limits. For drugs, the focus is primarily on those with higher costs within the scope of Guangdong Province's "dual-channel" drug list that have a significant impact on DRG group stability, with priority given to emergency, rescue, rare disease, and malignant tumor-related medications.

However, it is important to note that not all dual-channel drugs are included in the scope of separately calculated points for DRG. As of now, Guangdong Province has included 291 nationally negotiated drugs into dual-channel management, but only 78 drugs have been included in Foshan's separate calculation of points.

See the table below for details:

A review by the Pharmaceutical Cloud Workshop found that among the 78 drugs listed for separate calculation of points under DRG payment, there are some of the earliest biologics, such as adalimumab, bevacizumab, and cetuximab, for which multiple biosimilars have already been launched in China.

There is also a range of PD-1 products, including Innovent's sintilimab, Junshi's toripalimab, and BeiGene's tislelizumab.

Notably, nusinersen, a drug for rare diseases that entered the catalog through last year's national negotiations, is also included. After the "soul-crushing" price negotiation, the cost per injection decreased from 700,000 yuan to just over 30,000 yuan, significantly reducing expenses for patients and medical insurance.

Additionally, high-value consumables such as cochlear implants (domestic and imported), intraocular lenses (monofocal, multifocal, extended depth of focus), and peritoneal dialysis catheterization, which are also relatively high-cost and affect group stability, have been included in the scope of separately calculated points under DRG payment.

High-value drugs and consumables have garnered widespread industry attention in the context of DRG/DIP. Even after innovative drugs enter the catalog through national negotiations, their prices remain considerably higher than conventional varieties. Without supporting policies in terms of hospital access, utilization, and payment settlement, it would be difficult to incentivize hospitals to introduce nationally negotiated drugs.

Despite national measures such as not counting these drugs towards the total medical insurance expenditure cap, not assessing them against the drug proportion indicator, and the support of the dual-channel policy, the rate of nationally negotiated drugs entering hospitals remains relatively low.

Under the DRG payment system, which sets a capped payment standard per disease group, high-value drugs and consumables account for a significant portion of the group's cost, inevitably leading to considerable hesitation during clinical practice.

By adopting the method of separately calculating points under DRG payment for some drugs and consumables, Foshan has alleviated some pressure on hospitals and reduced significant concerns. This provides a potential solution for facilitating the introduction of high-value nationally negotiated drugs into hospitals, ultimately benefiting clinical practice and patients.

Hospital Clinical Assessment under DRG Payment: Annual Settlement Bonus Points

Attention to Nationally Negotiated Drugs, Centralized Procurement Drugs, and Key Monitored High-Value Consumables

Foshan has also made arrangements for annual settlement bonus points. The "Notice" indicates:

Based on the actual annual operation of the fund, factors such as the utilization of drugs included in national medical insurance negotiations, the use of drugs selected in national centralized procurement, the use of key monitored high-value medical consumables, the use of key monitored drugs, the clinical pathway utilization rate, and the evaluation results of medical insurance medical services will be explored as the basis for calculating bonus points. These will be specified in separate documents before the annual settlement.

Enterprises should pay attention to the aforementioned use of nationally negotiated drugs, centralized procurement drugs, and key monitored high-value consumables and drugs. If the assessment for these varieties is performed well, medical institutions will receive annual settlement bonuses. Therefore, hospitals are motivated to strengthen management according to the assessment requirements.