OBJECTIVES

Inpatient care is reimbursed through a prospective payment system for about 21% of hospitals in Japan. This system is called the diagnosis procedure combination per-diem payment system (DPC/PDPS). The DPC/PDPS has a separate evaluation system with individual hospitals receiving a reimbursement adjustment based on a number of quality measures. This research provides an overview of the current evaluation system for the DPC/PDPS in Japan and how it has affected reimbursement of inpatient care in Japan.

METHODS

The basic framework of the DPC/PDPS and its evaluation process are described with an analysis of the reimbursement adjustments allotted in 2018 by region and hospital type.

RESULTS

The DPC/PDPS uses an evaluation system that rewards hospitals based on information provision, lengths of stay, the type of care provided, and a number of other factors. In 2018 a higher reimbursement adjustment was allotted for hospitals in the northern Hokkaido and Tohoku regions, on average, driven primarily by greater performance in terms of the provision of regional care and emergency care – two components of the evaluation system. A higher reimbursement adjustment was also allotted for hospitals in the central Chubu region, on average, driven primarily by greater performance in terms of information provision and length of stay. University hospitals received a lower reimbursement adjustment, on average, driven primarily by poorer performance in terms of emergency care and the range (complex composition) of patients treated.

CONCLUSIONS

The DPC/PDPS includes an evaluation system that rewards hospitals for the quality and type of care provided with clear differences by region and type of facility. Based on this, hospitals operating under the DPC/PDPS system might benefit from services and technologies that help them maximize the quality and complexity of the care that they provide.