Localization Challenges and Strategic Approaches in Implementing DRG Payment in China

The Diagnosis-Related Group (DRG) is a system of classification that categorizes patients into distinct diagnostic groups based on various clinical and resource consumption factors, facilitating a predetermined payment for each group and promoting efficiency in healthcare expenditure. This study comprehensively examines the localization strategies for the DRG payment system in China, highlighting the necessity for continuous optimization of DRG grouping and payment standards, strengthening healthcare quality and cost control, preventing over-treatment and ethical risks, and constructing a comprehensive payment system. It also emphasizes the importance of enhancing the standardization and informatization of healthcare data to support the accurate collection, analysis, and utilization of data, ensuring more precise decision-making and policy implementation. The analysis is based on a review of international DRG payment systems and their diverse applications, providing valuable insights and comparative perspectives for China’s DRG payment reform. The study concludes that the localization of DRG payments in China is not only a technical challenge but also a vital step towards modernizing the healthcare system, which will significantly impact the medical and healthcare sector in China by ensuring the sustainable allocation of healthcare funds, improving service quality, and fostering the fair and efficient development of healthcare services across diverse regions, and ultimately enhancing health outcomes for the population.