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Global budgeting and the control of hospital costs

On 22 September, the ECCT's Healthcare Enhancement committee held a lunch meeting with guest speaker Chen Rui-ying, Counselor of the Taiwan Hospital Association. Counselor Chen gave a speech about the latest global budget and expenditure and the expected impact on healthcare industries in Taiwan. Global budgeting refers to direct government funding of the entire budgets of hospitals, introduced by the National Health Insurance Administration (NHIA) in order to reduce unnecessary spending. Under the global budget system, there is an expenditure cap in each medical field. If the total services performed exceed the field's budget quota, the reimbursement ratio is reduced, thereby shrinking payments for each service performed. Though the primary goal of the global budget is to reduce unnecessary waste of medical resources, the industry has observed some negative impacts this mechanism has had on the quality of healthcare. The event provided the opportunity for members to be briefed on the current status and expected spending next year.