Abstract: Under the framework of value-based healthcare, the diagnosis-related group (DRG) payment system has been recognized as a key mechanism for enhancing healthcare quality and efficiency, and it has been widely implemented all over the world. However, its effectiveness mainly depends on the alignment between disease characteristics and payment rules. Severe liver diseases are characterized by high clinical complexity, substantial risks, and intensive resource utilization. The current DRG payment model often fails to capture the true cost structure of such conditions, leading to financial deficits in some medical institutions. It suggests that the optimization of DRG systems should incorporate risk stratification, dynamic adjustment, and additional reimbursement mechanisms for innovative technologies to balance income control with clinical cost burdens from international experience. In China, preliminary reforms have demonstrated a gradual transition from cost containment toward value-based payment approaches. This review is aimed at discussing the current knowledge on the compatibility between DRG payment models and the management of severe liver diseases from a value-based healthcare perspective, to provide theoretical insights and policy recommendations for refining China’s payment system.

Key words: Severe liver disease, Diagnosis-related groups, Health insurance payment, Value-based healthcare