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Prospective casemix-based funding, analysis and financial impact of cost outliers in all-patient refined diagnosis related groups in three Belgian general hospitals

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Abstract

This study examined the impact of cost outliers in term of hospital resources consumption, the financial impact of the outliers under the Belgium casemix-based system, and the validity of two “proxies” for costs: length of stay and charges. The cost of all hospital stays at three Belgian general hospitals were calculated for the year 2001. High resource use outliers were selected according to the following rule: 75th percentile +1.5 ×inter-quartile range. The frequency of cost outliers varied from 7% to 8% across hospitals. Explanatory factors were: major or extreme severity of illness, longer length of stay, and intensive care unit stay. Cost outliers account for 22–30% of hospital costs. One-third of length-of-stay outliers are not cost outliers, and nearly one-quarter of charges outliers are not cost outliers. The current funding system in Belgium does not penalise hospitals having a high percentage of outliers. The billing generated by these patients largely compensates for costs generated. Length of stay and charges are not a good approximation to select cost outliers.

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Acknowledgements

We thank the Centre Hospitalier Régional de Huy, the Centre hospitalier Regional du Val de Sambre, the Centre Hospitalier Regional de Namur, and the Association Francophone d’Institutions de Santé, who provided funding for this study.

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Author notes

  1. Magali Pirson

    Present address: Département d’Economie de la Santé CP592, Ecole de Santé Publique de l’Université Libre de Bruxelles, 806 Route de Lennik, 1070, Brussels, Belgium

Authors and Affiliations

  1. School of Public Health, Université Libre de Bruxelles, Brussels, Belgium

    Magali Pirson, Dimitri Martins, Michèle Dramaix & Pol Leclercq

  2. School of Public Health, LaTrobe University, Bundoora, Australia

    Terri Jackson

Authors
  1. Magali Pirson
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  2. Dimitri Martins
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  3. Terri Jackson
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  4. Michèle Dramaix
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  5. Pol Leclercq
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Correspondence to Magali Pirson.

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Pirson, M., Martins, D., Jackson, T. et al. Prospective casemix-based funding, analysis and financial impact of cost outliers in all-patient refined diagnosis related groups in three Belgian general hospitals. Eur J Health Econ 7, 55–65 (2006). https://doi.org/10.1007/s10198-005-0331-0

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  • DOI: https://doi.org/10.1007/s10198-005-0331-0

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