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http://dx.doi.org/10.5762/KAIS.2020.21.4.201

A Study on the Sensitivity of Conversion Factor According to Change of Base Year  

O, Dongil (Department of Global Finance and Management, SangMyung University)
Publication Information
Journal of the Korea Academia-Industrial cooperation Society / v.21, no.4, 2020 , pp. 201-209 More about this Journal
Abstract
In this study, issues related to changes in base year, which have controversial effects on fees in service contracts, were reviewed. In this regard, sensitivity analysis was conducted on the effects of changes in base year on conversion factor by type. The benefits and disadvantages of each specific type of medical institution were examined. Main conclusions are as follows. First, changing the base year to be closer to the present time had a beneficial effect on the conversion factor of hospitals. Second, changing the base year to be closer to the current point of time had an adverse effect on the conversion factor of pharmacies and clinics and had a significant adverse effect on clinics. Third, assuming that a single conversion factor is collectively applied to all types, a favorable effect occurred in all cases when the base year was changed to be closer to the present time. Base year changes can bring about conflicts of interest between insurer and providers, and within providers. Therefore, changing the base year should be pursued upon mutual agreement on a reasonable basis for resource allocation. In addition, it is necessary to provide incentives for temporary compensation for the types of losses incurred.
Keywords
Fee for Service Contract; Conversion Factor; Base Year; National Healthcare Insurance; Payment System; Conflict of Interest; Price Reversal; SGR;
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