The Role of the Treating Physician in Profit or Loss of Global-Payment Cases in Two Public Hospitals in Isfahan, Iran

Introduction: Iran's global payment system, an incomplete adaptation of the diagnosis-related group (DRG) model, sets a fixed tariff for common surgeries without severity classes, and evidence on its financial consequences is inconsistent. We aimed to determine the role of the treating physician in the profit or loss of global-payment cases in two public hospitals in Isfahan, Iran (2021-2022).

Methods: This retrospective cross-sectional study analyzed 6,484 global-payment bills. Profit or loss per case was the tariff minus the actual cost, analyzed with one-way ANOVA, case-level multivariable regression adjusting for procedure code, month, hospital and specialty.

Results: Overall, 59.6% of cases were profitable and 40.3% incurred a loss. Mean physician profit ranged from -2.8 to 20.9 million Rials even within one procedure (cholecystectomy). In the multivariable model, between-physician differences remained significant (p<0.001; partial eta squared 0.06) and accounted for the largest share of variation after the procedure itself. They persisted within 18 of 29 codes, and the 11 non-significant codes were mostly low-volume, whereas the crude between-hospital difference disappeared after adjustment for procedure mix (p=0.87).

Conclusion: After adjustment for procedure code, hospital, month and specialty, physicians differed significantly in case-level profit or loss. This association may reflect physician practice or the physician's case mix; the available data cannot separate the two. It is therefore suggested that, before the global system is extended, diagnosis and patient characteristics be incorporated into it, as in DRG, so that one of these two sources can be controlled.

Keywords: Prospective Payment System; Global Payment; Economics, Hospital; Physicians; Diagnosis-Related Groups