The why, what and how of Casemix

The National Casemix Office (NCO) was established in 1994 in Winchester, to enable an improved understanding of healthcare activities provided to patients, at local, regional, and national levels.

Key to every Casemix Healthcare Resource Group (HRG) iteration was, and has been ever since, the support of our clinically led Expert Working Groups (EWGs), who work with the NCO to design HRGs that effectively represent clinical care, within the boundaries of available, nationally mandated data.

The NCO has been providing world class casemix expertise for more than two decades, covering both HRG design and development, and healthcare activity groupings. The team ensure that the finance, planning and commissioning needs of the NHS are incorporated into the Casemix designs, both current and future.

Casemix classifications have existed in the English NHS since the early 1990s and are used by the NHS to cost their healthcare activities, and by policy to reimburse healthcare providers for the activities they undertake.

To get an overview of the work of the NCO, we have produced a simple booklet which covers the basics.

Read about The Science of Casemix.

The term casemix has a number of meanings, from the literal “mix of cases (patients)” seen by a consultant/hospital/region, to the way in which patient care and treatments are classified into groups. These groups provide a useful measure on which to make performance comparisons, to cost healthcare, or indeed to fund it.

The key principles of a casemix classification are well-established internationally and require casemix groups to be:

•   clinically meaningful
•   relatively similar at the group level, in resource terms
•   based on mandated, standardised, and readily available data, and
•   manageable in number

The current HRG4+ evolved from the HRG4 classification, retaining the same scope, but developed to better reflect healthcare activities, especially in the world of multiples (complications, comorbidities, procedures), innovation (devices and technology) and complexity (infants, interventions, and interdependencies).

From an original focus on the Admitted Patient Care Commissioning Data Set, HRG4+ recognises that certain elements of patient care may be recorded using other data elements which interface with patient admissions, such as the Critical Care Activity Codes used for Critical Care Services in the Minimum Data Sets, or the Investigation and Treatment codes used by Emergency Departments in the Emergency Care Data Set.

In time, as the Casemix classification continues to evolve, HRG development will shift focus to encompass classifications that support the provision of Psychological Therapies, services provided in a community setting, or those recorded in greater detail in clinical registries.

To understand the specifics of how the current HRG4+ classification works we have produced a guide which contains further information.

Download The Casemix Companion

The development, maintenance, and evolution of a casemix classification requires a combination of established rules and principles, specialist expertise and data.

Casemix classifications are underpinned by consistency, empirical evidence, and a clear focus on what we’re trying to do, and why. In its simplest sense, a classification enables the health care system to understand the healthcare activities it undertakes, the type of patients who benefit from such activities and interventions, and the resource use required to deliver optimal patient care.

An awareness of the rigour employed by the NCO in the development of our classifications can help our users to:

• understand how the Casemix design can be used to benchmark healthcare services, within and between providers, and highlight differences in clinical practice, and patient outcomes
• appreciate how the Casemix design represents healthcare activity, supporting the development of new patient pathways, accompanied by a clear and quantifiable measure of the resources required for change
• recognise that the Casemix design can be used to establish baselines for future performance measurement, which is key to redesigning healthcare services for the future

The Casemix Design Framework outlines the key principles that are essential to any casemix classification and has evolved with each iteration of our classification. The Framework includes details of the Casemix design fundamentals and editorial rules used when developing our Casemix HRG designs, as well as how we measure the performance of our HRGs, to retain clinical relevance and validity.

Download The Casemix Design Framework

From a practical perspective, casemix groups reduce the administrative and analytical burden of those who use them. That said, they will never be accepted in a healthcare setting if clinicians do not recognise the care the groups describe.

HRGs are designed in co-operation with clinicians who represent the clinical care they provide, subject to the boundaries of available, nationally mandated, data. Clinical Leads on over 30 Casemix EWGs are nominated representatives of the Royal Colleges and professional bodies within the UK, and are joined on our EWGs by finance, informatics, and coding professionals.

This ensures not only that the HRGs are reflective of current clinical practice, but also that they can be practically implemented within the current national system architecture and standards.

The remit of the EWGs extends beyond the scope of specialist care to consider the less complex, more routine, care undertaken within the NHS. EWG members are not reimbursed for the time or expertise they provide.

A list of our EWG members is now available to download.

Empirical evidence is key to ensuring that the Casemix Designs continue to reflect clinical practice, innovation, and changes in care delivery protocols.

As key users of both Hospital Episode Statistics (HES) annual data, and the monthly Secondary Uses Service (SUS) data, the NCO have access to a wealth of data enabling us to support the development and assurance of our classifications.

Nonetheless, any casemix classification is reliant on the patient-level data that underpins it, and the impact of poor-quality data on Casemix developments has the potential to undermine how effective the classification can be at representing the healthcare delivered to patients.

The Casemix team are currently in the process of developing data quality and performance metrics detailing times-series and national benchmarking.

We have produced an HRG Audit Workbook, which details the HRGs used in the National Casemix Office designs since the introduction of HRG4, which was used for Costing 2006/07 and for Payment 2009/10. This design was then superseded by HRG4+, which was used for Costing 2012/13 and for Payment 2017/18. The audit details when the HRG was introduced and retired, where applicable, and in which design. The Costing and Payment designs, while inherently related in the costing to reimbursement cycle, are distinct and so considered separately.

HRG Audit Workbook 2025

If you have any comments or suggestions, or require any further information email us at the National Casemix Office mailbox:

[email protected]