Better health and ageing for all Australians

Classifications

Casemix Classifications

This page contains general information about Casemix classifications, Diagnosis Related Groups (DRGs), and Australian Refined Diagnosis Related Groups (AR-DRGs).

In this section:

Casemix is an information tool involving the use of scientific methods to build the classifications of patient care episodes. Casemix classifications are used routinely in the health sector in Australia and internationally to assist with clinical management and funding.

Casemix data enables the standard measurement of hospital care that classifies patient treatment and costs. Before the introduction of casemix in Australia in 1988, hospital statistics were not compiled on a national basis. The definitions and terms used in the States and Territories were not consistent, and this posed difficulties in comparing the performance of public hospitals. It is now the national standard classification system for public and private acute care services in Australia.

The casemix national infrastructure has been set in Australia through the activities of the Casemix Development Program (CDP). This program was superseded by the Hospital Information, Performance Information Program (HIPIP) in 2003. The objective of these programs has been to provide the health care industry with a nationally consistent method of classifying all types of patients, their treatment and associated costs in order to provide better management, measurement and payment of high quality and efficient health care services.

The Department of Health and Ageing manages the ongoing development of the AR-DRG Classification System in order to deliver a national standard for measuring the productivity of the major components of hospital care. This development process currently occurs over a two year cycle.

Diagnostic Related Groups (DRGs) have the longest history of development of any Casemix classification in Australia. Although DRGs originated in the US, Australia has for several years developed DRGs that reflect Australian clinical practice and use of hospital resources. These are known as the Australian Refined Diagnosis Related Groups (AR-DRGs). The AR-DRGs are used by public and private hospitals, and state and territory health authorities in managing public hospitals.

Underpinning the AR-DRGs is the ongoing maintenance of the International Statistical Classification of Diseases and Related Health Problems, Tenth Revision, Australian Modification (ICD-10-AM). This maintenance is undertaken by the University of Wollongong (UoG), which is primarily funded by the Australian Government since its inception in July 2010.

Australia is considered a world leader in Casemix activities and is well recognised for its expertise and developments with the AR-DRGs and the ICD-10-AM/ACHI/ACS. The ICD-10-AM forms the basis for the AR-DRG Classification in that procedure codes and diagnosis codes are grouped to DRGs. All public and private hospitals in Australia code to ICD-10-AM and subsequently group to AR-DRG for acute inpatient episodes of care. The AR-DRGs are updated every two years to reflect changes in clinical practice. This is a formal agreement with States and Territories through the National Health Information Agreement (NHIA 2004-2009).

The Department has in place a contract with the University of Wollongong to manage the ICD-10 refinement process and to work with a range of key stakeholders on ICD development. The Department and UoW currently have a contract for services until 30 June 2013.

There are also contractual arrangements with companies to develop proprietary software for sale to hospitals (both nationally and internationally in certain countries) which provides for adoption, and support for use, of the System.

AR-DRG Classification System

The Australian Refined Diagnosis Related Groups (AR-DRG) Classification System classifies acute inpatient episodes into categories based on clinical content and resource consumption. The AR-DRG Classification System includes two components.

1. ICD-10-AM/ACHI/ACS:

The University of Wollongong, under contracting arrangements with the Department of Health and Ageing, produces the ICD-10-AM/ACHI/ACS (first component of the System). This Coding Classification is utilised in public and private facilities for the production of statistical data and to support funding submissions to the Australian Institute of Health and Welfare (AIHW) and the Department.

Visit the University of Wollongong website to enquire about training, or to order the ICD-10-AM/ACHI/ACS (licenced countries only).

Using as a base the International Statistical Classification of Diseases and Related Health Problems, Tenth Revision (ICD-10), publication by World Health Organisation (WHO), the UoW provides Australian modification (ICD-10-AM) for the diagnoses codes. These are 4th and 5th digit levels providing extra specificity to some areas where clinicians would like to differentiate particular conditions. The University also creates a list of procedure codes:
  • The Australian Classification of Health Interventions (ACHI) based on the Medicare Benefits Scheme with further expansion to meet clinical requirements.
  • The Australian Coding Standards (ACS) based on the work undertaken by the Coding Standards Advisory Committee. Australian Coding Standards are created with the objective of sound coding convention according to the Australian Coding Classification and to ensure accurate coding practice. The Standards explain how the analysis of the entire clinical record should be performed before code assignment.
ICD-10-AM/ACHI/ACS provides documentation, code assignment, and reporting of diagnoses and procedures at the national level.
The ICD-10-AM/ACHI/ACS is provided over 5 volumes:
volumes 1 and 2: ‘The International Statistical Classification of Diseases and Related Health Problems, Tenth Revision, Australian Modification' (ICD-10-AM). Volume 1 is a Tabular List of Diseases, Volume 2 is an Alphabetical Index for Diseases;
volumes 3 and 4: ‘The Australian Classification of Health Interventions’ (ACHI). Volume 3 is a Tabular List of Interventions, Volume 4 is an Alphabetical List of Interventions; and
volume 5: ‘The Australian Coding Standards’ (ACS).

This is available in hard copy (5 volumes) and electronic format (eBook).

2. AR-DRG Classification:

Using the ICD-10-AM/ACHI/ACS, the Department of Health and Ageing maintains the Australian Refined Diagnosis Related Groups (AR-DRG) Classification and the Definitions Manual. Each DRG of the System consists of the diagnoses and/or procedure codes which define it.

To ensure that DRGs remain valid over time and continue to reflect changes to medical, surgical and coding practises, the Department provides resources for clinical consultation and statistical analyses.

The AR-DRG Classification System is updated every two years to reflect the latest technology and medical practice, and to ensure that the new procedures and techniques are incorporated into the Classification as rapidly as possible. Each release of the Classification investigates both statistical and clinical effects.

In November 2008 Version 6.0 of the AR-DRG Classification System was launched at the ‘Extending the boundaries’ Casemix Conference in Adelaide. It is a major update to the classification and incorporates the sixth edition of the ICD-10-AM/ACHI/ACS.

The AR-DRG Classification includes the AR-DRG Classification rules; and Definitions Manual.

This is available in hard copy format (3 volumes of the AR-DRG Definitions Manual and electronic format (electronic files).

The AR-DRG Definitions Manuals are available for purchasing through the website of the University of Wollongong (UoW) only for the countries that have current licensing arrangements with Australia to the use the System.

Top of page