The Response of Different-Levels Public Hospitals to Regional Global Budget with a Floating Payment System: Evidence from China

Regional Global Budget with a Floating Payment System (RGB-FPS) is a global budget widely used in medical insurance payments. However, existing studies on hospitals' responses to RGB-FPS have limitations. First, existing studies have paid little attention to RGB-FPS's macro effects. Theoretical studies did not analyze differences between different levels of hospitals. Secondly, studies did not reveal whether RGB-FPS has the same impact on the public-hospital-dominated market. First, we refine the research hypotheses through theoretical analysis. We then test the hypotheses empirically through interrupted time series analysis. Theoretical analysis found that small hospitals were easier to transfer costs. The empirical analysis found that after RGB-FPS, the proportion of inpatients (PI)and the average times of inpatients in large hospitals increased ( < 0.001), and the proportion of non-reimbursable expenses (PNE) remained stable ( > 0.05). PI in secondary hospitals decreased ( < 0.01), and PNE increased ( < 0.01). PI in the primary hospital decreased ( < 0.05), and PNE increased ( < 0.001). This study verifies theoretically and empirically that large hospitals are easier to increase service volume and small hospitals are easier to transfer costs under the influence of RGB-FPS. Chinese public hospitals' response to RGB-FPS is similar to that of private hospitals.