With the aging of population, miniaturization of family size and changes of diseases spectrum, the demand for long-term care of Chinese elderly is increasing, which is challenging the existing long-term care system. China is currently carrying out pilot work for a long-term care insurance system, and Jingmen is one of the pilot cities, however more detailed research on payment is needed. Therefore, this paper draws on case-mixed-adjusted prospective payment system to provide designs for long-term care insurance in pilot cities.

Adopting a case analysis method, this paper focuses on system for payment of Skilled Nursing Facility under Part A of the Medicare program—Patient Driven Payment Model, and discusses the implementation plan of a long-term care insurance in Jingmen City from the perspectives of payment methods, payment grouping and payment standards.

Currently Jingmen adopts per-diem payment for long-term care insurance, so it is necessary to establish a payment based on population characteristics and demands. So, the patients should be classified into a group for each of the five case-mix adjusted components: physical therapy, occupational therapy, speech therapy, nursing and non-therapy ancillary. In addition, this payment model also includes a “variable per diem adjustment” to account for the changes in patient costs more accurately.

The theoretical system of a long-term care insurance payment method is developed, and a localization plan for case-mixed-adjusted prospective payment system for long-term care insurance is provided. Therefore, Jingmen long-term care insurance payment should adopt “case-mixed adjustment”, strengthening the relationship between individual clinical characteristics and payment.