Sustainable and strategic health financing is crucial to Universal Health Care (UHC). From a fee-for-service (FFS) model to the All-Case Rates (ACR) system, PhilHealth has steadily shifted from a reactionary, retrospective PPM to one that promotes greater hospital efficiency. PhilHealth’s yearly milestones indicate the crafting of DRG version 0 (v0) for the year 2022. This project serves as a direct input to this PhilHealth UHC milestone as well as the next iteration of Diagnosis-Related Group (DRGs) version 1 (v1), which will be used in actual billing and payment. Specifically, this project will develop the Philippine DRG rate setting method (i.e., adopt TDRG v5), grouper, documentation, and monitoring framework to assess the impact of DRGs on hospital care (e.g. quality, efficiency) in the Philippines.