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. 2025 Jun 7;15(1):48.
doi: 10.1186/s13561-025-00643-6.

How does the dual policy-the C-DRG-based reimbursement system and subsidy policy for appropriate Traditional Chinese Medicine (TCM) techniques-influence physicians' choice of disease treatment methods in TCM hospitals?

Jin Zhang  1 , Junfeng Liu  2 , Lingfei Qu  3 , Zihao Duan  1
Affiliations

How does the dual policy-the C-DRG-based reimbursement system and subsidy policy for appropriate Traditional Chinese Medicine (TCM) techniques-influence physicians' choice of disease treatment methods in TCM hospitals?

Jin Zhang et al. Health Econ Rev. .

Abstract

Background: This study investigates the impact of the diagnosis-related group (DRG) reimbursement system and subsidy policies on the treatment methods of traditional Chinese medicine (TCM) orthopaedic physicians. The objective is to determine the optimal subsidy amount to maximize the number of treated patients.

Methods: Using Evans' profit maximization theory, the study examines the intrinsic motivations behind physicians' behaviours and their influence on the medical market. A discontinuous time series analysis evaluates the effects of the C-DRG-based reimbursement system and subsidies on the number of treated inpatients and inpatient expenses in TCM orthopaedics.

Results: The expanded implementation of the C-DRG-based reimbursement system substantially boosted both orthopaedic surgery and TCM technology case volumes, with 55 additional orthopaedic procedures and 200 extra TCM interventions recorded (p < 0.001).Total and surgical expenses decreased notably by 42.7% and 26.29%, respectively(p < 0.001), while inpatient expenses for TCM techniques decreased significantly by 32.63% (p < 0.05). Subsidy policies during the C-DRG-based reimbursement system implementation significantly increased the use of appropriate TCM techniques without substantially impacting total expenses. Physicians partially achieved both DRG expenses control and subsidy policy objectives by reducing total expenses and increasing TCM technique usage. The optimal subsidy amount was calculated to be 584.79 RMB, showing a linear relationship with TCM orthopaedic cases, with peak usage aligning with optimal subsidy timing.

Conclusion: The C-DRG-based reimbursement system and subsidy policies positively influenced the treatment methods of TCM orthopaedic physicians, increasing the number of treated cases and reducing expenses. An optimal subsidy of 584.79 RMB was identified to maximize the number of treated patients, aligning with both DRG expenses control and subsidy policy objectives.

Keywords: Appropriate Traditional Chinese Medicine (TCM) techniques; Diagnosis-Related Group (DRG) payment system; Interrupted time series analysis (ITS); Optimal subsidy expenses value; Policy impact.

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Conflict of interest statement

Declarations. Ethics approval: Not applicable. Consent to participate: Not applicable. Consent for publication: Not applicable. Competing interests: The authors declare no competing interests.

Figures

Fig. 1
Fig. 1
Changes in the number of orthopedic surgeries and the number of appropriate TCM techniques before and after C-DRG-based implementation
Fig. 2
Fig. 2
Changes in the expenses of orthopedic surgeries and the number of appropriate TCM techniques before and after C-DRG-based implementation
Fig. 3
Fig. 3
The impact of C-DRG-based system on the count of surgical procedures
Fig. 4
Fig. 4
The impact of C-DRG-based system on the count of appropriate TCM techniques
Fig. 5
Fig. 5
The impact of C-DRG-based system on total expensess
Fig. 6
Fig. 6
The impact of C-DRG-based system on surgical expensess
Fig. 7
Fig. 7
The impact of C-DRG-based system on expensess of appropriate TCM techniques
Fig. 8
Fig. 8
Optimal solution for subsidy expensess
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