Case mix

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The term Casemix refers to the type or mix of patients treated by a hospital or unit. Casemix based funding is the key funding model currently used in Australian health care services for reimbursement of the cost of patient care.

Casemix is a system that measures hospital performance, aiming to reward initiatives that increase efficiency in hospitals. It also serves as an information tool that allows policy makers understand the nature and complexity of healthcare delivery.

Diagnosis Related Groups (DRGs) is the best-known classification system that is used in this funding model. It classifies acute inpatient episodes into a number of manageable categories based on clinical condition and resource consumption. A single acute episode of inpatient care is allocated to one DRG using coded clinical information derived from the patient’s medical record. This information is coded by the Health Information Managers in order to allocate a DRG. Each DRG is allocated a ‘weight’, which is dependent on the average cost of inputs (e.g. nursing, diagnostic services, procedures) required to achieve the appropriate patient outcome. The facility is reimbursed a predetermined amount for each patient episode.