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DRGs in the Private System – Options and Impacts

Session 3 MedTech20 covered “DRGs in the Private System – Options and Impacts”.

There are calls for the reform of the way medical devices are paid for and the question raised is “should Diagnosis Related Group (DRG) funding models replace the Prostheses List to pay for prostheses through the private healthcare system”.

This approach is supported by Private Healthcare Australia (PHA), the Grattan Institute and the Independent Hospital Pricing Authority (IHPA).

It has been proposed that a better way to pay for protheses is through activity based funding ie rather than paying for an individual device, it would be paid through an averaging process.

Alternative funding models were discussed and it was noted that DRG was originally designed as a classification model, not a funding model.

There needs to be more discussion and agreement on the best approach to sustainable funding arrangements whilst ensuring that doctors have choice taking into account individual patient needs.


Thanks to the speakers: Paul Dale, Ben Harris, Cathy Ryan, Natalie Lawandi, Rochelle Airey