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

2. 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 – 45 227 km2 Population – 1 370 000 (Estonians 65%, Russians 28%, Ukrainians 3%, Belorussians 1%, Finns 1%, other 2%) Independent since 24.02.1918, occupied by the Soviet Union 1940, regained the independence on 20.08.1991. Member of the European Union since May 1st 2004. We have been here since 6500 BC!

3. Background – Soviet heritage Centralized state-controlled over-capacitated provider network (120 hospitals with 18 000 beds) Polyclinics budget financed

4. 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

5. Hospital Master Plan Regionalism Golden Circle

6. Financing

7. 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).

8. Contract

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

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

11. 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

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

13. Conclusion? Confusion Loss of transparency

14. 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 €

17. 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?

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

19. Case study - Pärnu Hospital Around 15 000 bills that concern DRG –2 300 don’t classify –Over 50% of bills are covered by 22 DRGs

22. Are prices fair? 2005 – 2006101% 2006 – 2007101% 2007 – 2008119% 2008 – 2009101% 2009 - 2010101%

25. DRG 182 2006-2010 DRG billing in infectious diseases department always negative DRG 182 one of the most usual (1-3) 01.01.2010– 21.05.2010 42 cases - negative financial aspect 44 710 EEK - negative 19 - positive 23 Negative in cases with over 5 days admission

26. DRG 225 2006-2010 DRG billing in orthopedics department always negative DRG 225 one of the most usual (4-5) 01.01.2010– 21.05.2010 16cases - negative financial aspect 29 269 EEK - negative 13 - positive 3 Negative in higher class operations

27. 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

28. Tervist!