“More work means less pay”: a qualitative understanding of physicians’ patient selection decision-making under DRG reform in Nanjing, China

Abstract Background Patient selection, also known as ‘cream-skimming’, can lead to the systematic exclusion of high-cost, clinically complex patients from necessary care. It has been identified as an opportunistic response under Diagnosis-Related Groups (DRGs) payment systems globally. As China advances the rollout of DRG reform alongside commitments to promoting healthcare equity, understanding the ecology of physicians’ cream-skimming behaviour and how to mitigate it is imperative. Methods We purposively sampled 21 physicians from two hospitals with different incentive structures in 2024 and conducted semi-structured face-to-face interviews on their experiences with and responses to DRG reform. Data were analysed using an inductive thematic approach followed by deductive framework analysis. Results We found that, in this study setting, physicians often assessed whether the expected reimbursement would cover the anticipated treatment costs when making admission decisions, with patient selection emerging as an adaptive response to DRG payment incentives. Their decisions were shaped by interacting factors related to capability, opportunity, and motivation. Capability captured physicians’ confidence in managing financially risky cases; opportunity encompassed the physical and social conditions that enabled them to balance financial risk with quality of care; and motivation concerned the value they placed on different outcomes. Physicians were more likely to admit financially risky patients when three dimensions aligned: they believed that these patients could be effectively managed under DRG payment, expected their decisions to produce meaningful and recognised outcomes, and valued those outcomes, including patient welfare and the fulfilment of professional obligations. Conclusions The findings suggest that physicians’ responses to DRG payment are driven not only by formal payment rules but also by how financial risks are perceived and mediated within hospitals and the broader health system. Improving equitable access requires realigning performance metrics with clinical needs, strengthening referral and post-acute care pathways, and reducing reliance on individual risk-based decision-making through team-based support.