DRGs Are Now Live

After several postponements, effective 1 September 2020, all Dubai Health Authority (“DHA”) and Dubai Healthcare City (“DHCC”) licensed hospitals registered on the eCLaimLink and submitting inpatient claims are mandated to submit Diagnosis Related Groups (“DRGs”) for inpatient services, moving away from fee-for-service payments.

Simultaneously, the Dubai Health Insurance Adjudication Manual was issued to provide guidance to claims processing officers to adjudicate claims correctly and consistently in accordance to standardised adjudication rules. Hospitals and insurers are required to submit and adjudicate all inpatient claims in accordance with the manual. Of note is that hospitals will be required to continue submitting consumable codes (HCPCS – Healthcare Common Procedure Coding System – Level II), drug codes (DDC – Dubai Drug Codes – most recently issued 6 July 2020) and service codes (DSL – Dubai Service List) for inpatient claims.

This transition to DRGs follows the footsteps of the Emirate of Abu Dhabi, where the Abu Dhabi Department of Health (“DOH”) started implementing DRGs in 2011. Similar to the DOH, the DHA has also adopted the International Refined – Disease Related Groups (“IR-DRG”), as it is compatible with Dubai’s existing coding practice (ICD-10-CM and CPT 2018 classification).

The DHA also created the Dubai Medical Coding Manual to standardised medical coding and adjudication practices in Dubai; medical coders and clinical staff are encouraged to familiarise themselves with the same to ensure accuracy, completeness, and specify of medical coding, which will impact the assignment of DRGs. Properly capturing every legitimate diagnosis and procedure maximises the accuracy of the DRG assignment and, consequently, claims reimbursement.

DRGs are expected to reduce the cost of healthcare in the emirate, by encouraging hospitals to be more efficient in treating patients, reducing the incentive to over-treat patients. DRG systems critically depend upon accurate coding of inpatient hospital stays. Consequently, the implementation of DRGs will need to be closely reviewed as, for example, misrepresentations in medical coding can cause the DHA to reach base prices for each procedure that are inaccurate, which can have significant financial consequences for insurers. Further, the cost of new technology in order to install, integrate, and maintain IR-DRG can negatively impact some providers. Finally, the industry has historically stumbled to effectively implement new technology systems (one example being e-prescriptions). The DHA will need to closely work with stakeholders to ensure a smooth transition and ongoing quality of care in Dubai.

Al Tamimi & Company’s specialist healthcare lawyers, regularly advise on legal and regulatory matters concerning the healthcare sector. For more details on our offering and how we can assist you, please contact us at healthcare@tamimi.com.

Key Contact:

Christina Sochacki
Senior Associate, Healthcare
c.sochacki@tamimi.com