1 INTRODUCTION

Access to healthcare services is a fundamental human need, ensuring individuals receive timely and suitable medical care, spanning primary care, specialized treatments, and hospitalizations. However, achieving equitable healthcare access is confronted by various challenges, including the utilization of diagnosis-related groups (DRGs). The progress of medical sciences and the increasing use of advanced diagnostic and treatment tools have contributed to escalating healthcare costs. As a result, healthcare financing systems play a vital role in providing affordable services to communities. To curb the rapid growth of medical expenses, reforming the healthcare financing system becomes imperative. The financial system significantly impacts people's health and well-being, necessitating the design and modification of reimbursement mechanisms as a foundation for these reforms. By addressing these challenges and implementing necessary changes, equitable access to healthcare can be enhanced, ensuring individuals can afford and receive the care they require.^{1, 2}

The escalating costs of healthcare are primarily attributed to the rapid advances in medical sciences and the utilization of innovative technologies and therapies. These advancements have undoubtedly improved patient outcomes but pose significant financial challenges. The development and availability of new diagnostic tools, therapeutic interventions, and pharmaceutical treatments come with substantial research and development costs, specialized training requirements, and expensive infrastructure. Healthcare financing systems play a crucial role in addressing these challenges by ensuring the affordability and accessibility of healthcare services. However, the need for reform is evident to strike a balance between medical advancements and financial implications, promoting sustainability and equitable access to quality healthcare. Comprehensive reforms in healthcare financing systems are required to tackle the underlying drivers of cost escalation and optimize resource allocation, reimbursement policies, and coordination among stakeholders. Reimbursement mechanisms are crucial tools in upgrading and developing the health system and achieving its goals. Since hospitals are a significant part of the healthcare system, reimbursement mechanisms positively affect the proper use of hospital resources. Accordingly, there will be many benefits to the healthcare system's financial system. In many countries, improving the efficiency of hospitals allows these centers to provide better quality services by making optimal use of available resources.^{3, 4} Reimbursement mechanisms are divided into retrospective and prospective payments. In retrospective reimbursement, costs are calculated and paid after the service is provided, while in prospective reimbursement, it is calculated before the service is provided. One of the prospective payment systems (PPS) that has been considered in the financial system of countries is DRGs.^{3, 5} DRGs group patients with similar diagnoses, procedures, and demographic characteristics to establish a standardized framework for reimbursement. By categorizing patients into specific DRGs, healthcare providers and insurers can determine appropriate payment amounts based on expected resource utilization. DRGs play a crucial role in patient classification by simplifying the complexity of healthcare services, promoting fairness in reimbursement, and incentivizing cost-effective care. This system aids in optimizing resource allocation, improving efficiency, and ensuring the sustainability of healthcare delivery. The process of forming DRGs is done by dividing all the primary diagnoses under the name of major diagnostic categories (MDCs), and there are subsets of the main diagnostic classes of basic DRGs.⁶ A baseline DRGs can be identified by a specific set of patient characteristics such as primary diagnosis, treatment action, discharge status, presence or absence of complications or comorbidities, age group, gender, disease severity, and birth weight at neonatal admission. Each group of DRGs has a relative value that indicates the number of resources used by patients in each group. The higher this value, the more resources are spent on treating the patient and the higher the cost for the patient.^{5, 7}

In Germany, the DRGs action plan has been implemented since 2000 to reduce healthcare costs and control costs per patient admission. The essential elements of the DRGs implementation action plan in this country are:

As an Asian country, China has been gradually implementing DRGs since 1996, along with outdated payment systems. Essential elements in this implementation are:

DRGs have been the primary impetus for controlling general costs. Other goals of this system are to help budget planning and improve the general financial situation in the health and social affairs sector, operation review, management, and planning. It also helps reduce future costs, optimize organizational and operational structures, and better allocate financial resources.^{8, 14} DRGs increase the efficiency of care services, improve the performance of the reimbursement system, stabilize the financial status of hospitals, and the possibility of estimating the length of patients’ stay. In other words, predicting the patient's medical costs and financial services requires the implementation of DRGs and coordinated response by hospital departments, including the management and health information management.¹⁵

Given the recognized benefits of DRGs, countries worldwide are actively seeking to design specific plans for implementing DRGs. To achieve this, each country must create a clear and tailored strategic plan, known as the Action Plan, taking into account their unique needs, existing information systems, and factors such as population dispersion and access to information. This detailed plan serves as a roadmap, outlining the necessary steps to accomplish one or more goals and can be seen as a sequential series of activities that are crucial for the success of a strategic plan. Consequently, due to the imperative need for DRG implementation and the absence of an action plan in Iran, the objective of this study is to provide a comprehensive model for an action plan to implement DRGs.

DRGs hold a pivotal role in healthcare organizations by optimizing operational efficiency, managing costs, and improving patient care, all while ensuring financial stability and transparency. However, the effective integration of DRGs into a healthcare system requires a strategically designed DRGs-based Implementation Action Plan. This plan acts as a guide, facilitating the seamless incorporation of DRGs and delineating the essential steps for transitioning to a DRG-based system. Moreover, it addresses potential challenges and offers effective solutions. It is crucial to acknowledge that implementing DRGs may result in increased expenditures, potentially straining the system. Hence, a well-structured action plan is vital for effectively managing these changes. Notably, in the context of Iran's treatment systems, there has been a lack of a comprehensive action plan specifically tailored for DRG systems. Consequently, this academic paper introduces the inaugural action plan aiming to facilitate a smooth and native implementation of DRGs in Iran. On the other hand, given the limited availability of a country-specific action plan for DRG implementation in healthcare systems resembling Iran's, our research aims to bridge this gap by conducting a comprehensive study of DRG systems in developed and advanced countries. This investigation serves the purpose of not only understanding the potential applicability and feasibility of DRG systems within Iran's healthcare environment but also gaining insight into the possibilities and dynamics of Iran's healthcare system through the presentation of our proposed action plan.

2 MATERIALS AND METHODS

The present study is an applied and cross-sectional study conducted in three stages as follows.

3 RESULTS

A review of studies indicates that the DRGs-based implementation action plan in the study countries has improved the quality of healthcare delivery and reduced treatment costs. List No. 1 identifies the strategic approach of the DRGs-based implementation action plan, including goals, implementation method, executive processes of an action plan, laws and regulations, standards, policies, transparency, and monitoring and evaluation. List No. 2 shows the technical dimensions of the DRGs-based implementation action plan, including how to update DRGs, provide technical support for DRGs, and empower hospital systems. List No. 3 also shows the executive institutions involved in the DRGs-based implementation action plan, including the Iranian Ministry of Health and Medical Education, the DRGs specialized committee, health insurance organizations, DRGs coordinators, and healthcare organizations.

List 1. The strategic approach of the DRGs-based implementation action plan.

List 2. Technical dimensions of the DRGs-based implementation action plan.

List 3. Executive institutions involved in the DRGs-based implementation action plan.

3.2 Findings in the second phase of the Delphi technique

At this phase, the suggestions made in the first stage were applied to the plan. Then, a panel of experts with the presence of four health information management experts was formed, the proposed model was re-examined, and the desired model was finalized (Figure 1).

Based on the reviewed studies the DRG action plan model has shown positive impacts on healthcare delivery and treatment costs. The use of local DRGs has resulted in increased efficiency of healthcare services, allowing for better resource allocation and improved patient outcomes in Iranian healthcare sectors. By categorizing patients into specific groups diagnoses and procedures, our DRGs simplify the complexity of healthcare services, leading to more accurate and fair reimbursement. This promotes cost-effective care and incentivizes hospitals to optimize resource utilization. Furthermore, DRGs help control treatment costs by providing a standardized framework for reimbursement, ensuring that healthcare providers are appropriately compensated based on expected resource utilization. Overall, the implementation of DRGs has contributed to enhancing the quality of healthcare delivery while reducing treatment costs.

4 DISCUSSION

Implementing DRGs in various countries has many benefits for the healthcare financial system, including reducing the cost of treatment, quality assurance, reducing the length of stay of hospitalized patients, and optimal use of hospital resources.⁸ Accordingly, different countries sought to develop an action plan to implement the DRGs. For the first time in the United States in the mid-1970s, Prof. Fetter et al. and Thompson et al. at Yale University Health Center developed DRGs as a tool to measure the use of hospital services and quality assurance programs. The version used included 383 diagnostic groups known as DRGs, which used ICD-8 as the primary disease classification system. Australia was also the first European country to implement the DRGs action plan to develop the Case-mix program. The Australian Case-mix development plan was established and funded in 1989 over 5 years. Medicare agreements were concluded between the Commonwealth of Australia and the United States of America. It was a joint venture between major stakeholders, including states, the federal government, the clinical community, statistical agencies, universities, the public and private sectors, hospitals, and private health insurance.^{2, 15, 16} Over time, various countries, including Germany, China, and Bulgaria, began implementing the DRGs’ action plan. In Germany, one of the primary goals for this purpose was to reduce healthcare costs and control costs per admission per patient^{10, 11} Böcking pointed out that in Germany, government and federal agencies are responsible for medical pricing using the G-DRG system, overseen by the Ministry of Health and the Federal Medical Association. In this country, paying good money for first-class medical services is meaningless because all medical centers must provide complete services to patients. This means that in any city, state, or hospital, it is not money that saves patients but the powerful German legal system that saves the sick.¹⁷

China was one of the largest Asian countries to implement the DRGs. Pilot implementation of this program by Insurance BJ-UEBml began in 2003. Local versions of DRGs and pilot programs provided the basis for evaluating hospitals’ performance in this country^{8, 12, 18} Before DRGs, Bulgaria also used the Clinical Care Pathways (CCP) reimbursement method, a modified case-based payment form. The Bulgarian CCP system faced several challenges, including not covering all diagnoses and increasing treatment costs, so introducing DRGs seemed necessary. In 2011, Bulgaria used version 6 of the Australian AR-DRGs classification to provide more efficient services, reduce unnecessary procedures, and improve medical costs transparency^{13, 19, 20}

In the proposed the DRGs-based implementation action plan model in Iran, the main goals include reforming and improving the hospital reimbursement system, reducing and controlling costs, stabilizing the financial status of hospitals, the ability to estimate the length of stay of patients, predicting patients’ medical costs and financial services, improving the usefulness of health budgets, budget planning and balancing of hospitals, and thus improving the quality of services.^{13, 17, 21} According to the Chilingerian study, the primary elements of the DRGs-based implementation action plan model in the United States are establishing a case group, determining relative cost values, Grouper Software development, training, and evaluation. The essential elements in Australia include setting a national budget to align previous activities tariffs with activities in the DRGs, publishing an AR-DRG classification system guideline, and clearly defining the types of hospital services for DRGs reimbursement.^{4, 12} Australian action codes to German (OPS) and converting diagnostic codes to ICD-10-GM. In addition, an audit system to control relative cost by the Institute for the Reimbursement System in Hospitals (InEK). In China, the primary elements of this plan were determining the base rate and relative weight, creating a specialized team of DRGs project, and developing grouping software based on BJ-DRGs. According to the study of Shah et al., the primary elements in Bulgaria are the gradual implementation of the action plan model for DRGs, the development of relative weights, the expansion of the capacity of executive institutions, and the development of technical issues.^{10, 16, 18}

The proposed DRGs-based implementation action plan model in Iran is formed in three main axes; the first axis includes the strategic approach to the DRGs-based implementation action plan, and the second axis includes technical dimensions. In the third axis, the prominent institutions of the DRGs-based implementation action plan model include the Ministry of Health and Medical Education, the DRGs specialized committee, insurance organizations, DRGs coordinators, and healthcare organizations. In most countries studied, the Ministry of Health or the government itself was primarily responsible for the DRGs-based implementation action plan. Regarding the third axis, Rajtar, in a study, considers executive institutions such as insurance companies, hospital managers, and stakeholders related to the implementation of DRGs as an integral part of the operation of this system. Chilingerian points out that in October 1983, in the United States, the responsibility for modifying and changing the definitions of DRGs was delegated to the Health Care Finance Administration (HCFA).^{9, 12}

In most countries, the DRGs-based implementation action plan model has been done gradually, first at the hospital level and then at the macro level. According to the proposed model, the development and implementation of DRGs can gradually be done in Iran in several phases. First, the compatibility of data between AR-DRGs requirements and data in medical records in several public hospitals will be evaluated as a pilot. Next, focus on system compatibility according to the needs of hospitals, including compliance with classifications and clinical coding and health care providers, reimbursement policies, information management systems, performance and quality management procedures, pricing, and tariffs.

The benefits of implementing DRGs in healthcare systems are well documented. Several studies have shown that the implementation of DRGs leads to increased efficiency, improved quality of care, and reduced costs of care. So that some countries reported a 15%–20% improvement in the reduction of hospital costs, although the quality of services provided was improved or remained constant. These benefits are fully consistent with the goals of Iran's proposed action plan, which aims to improve healthcare services, optimize resource allocation, and control healthcare costs.

In the proposed model, leading institutions play a key role in the successful implementation of DRGs in Iran. Healthcare institutions in Iran must have close cooperation to achieve the successful implementation of the DRG action plan. The university institute conducts research and development of the model, while the Ministry of Health, Medicine and Medical Education provides necessary guidance and coordinates implementation efforts.

The proposed model in Iran aligns with international best practices by combining the key elements of successful DRG implementation. This emphasizes the need for a phased approach, starting with a hospital-level pilot before scaling up nationally. This approach provides the possibility of testing, modifying, and adapting to Iran's unique healthcare landscape. This model considers Iran's healthcare infrastructure, available resources, and cultural considerations to ensure its feasibility and effectiveness.

In summary, the reviewed studies provide specific examples and statistics that reinforce the benefits of DRG implementation, such as cost reduction and efficiency improvement. These benefits are fully consistent with the objectives of Iran's proposed action plan. Leading institutions involved in this model collaborate and contribute their expertise to ensure successful implementation. The proposed model in Iran is aligned with international best practices by using phased implementation and considering local conditions.

As a recommendation for future research, it would be beneficial to explore the utilization of existing technology in designing DRG models. Given the widespread adoption of artificial intelligence (AI) in medical data analysis, hospital management, and computer-assisted technology in healthcare system cost optimization,^22-25 it can be argued that AI applications are continuously advancing through the introduction of advanced algorithms and cutting-edge technologies. Therefore, it is worth considering the implementation of these algorithms to design DRG models, aiming to create a comprehensive and personalized model for each healthcare system by analyzing all relevant factors.

5 CONCLUSION

Given the importance of DRGs in reducing costs and improving the quality of health services in all countries, an action plan to implement DRGs is an undeniable necessity. After examining and approving the DRGs-based implementation action plan model, it is suggested to form an advisory committee consisting of executive teams involved in DRGs implementation, pilot and gradual implementation at the hospital level and then at the national level, and releasing the base rate at the national level.

AUTHOR CONTRIBUTIONS

Farkhondeh Asadi: Investigation; methodology. Mahrokh Anvari: Conceptualization. Mustafa Ghaderzadeh: Methodology; project administration; Software; supervision; validation. Nahid Ramezan Ghorbani: Data curation.

CONFLICT OF INTEREST STATEMENT

The authors declare no conflict of interest.

ETHICS STATEMENT

This study is approved under the ethical approval code of IR. SBMU. RETECH. REC.1400.520.

TRANSPARENCY STATEMENT

The lead author Farkhondeh Asadi affirms that this manuscript is an honest, accurate, and transparent account of the study being reported; that no important aspects of the study have been omitted; and that any discrepancies from the study as planned (and, if relevant, registered) have been explained.