Are U.S. naval hospitals operated efficiently: a study using dianosis related groups
Long, Albert Benjamin III
Osment, Howard Thomas
Whipple, David R. Jr.
Greer, Willis R. Jr.
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In an effort to control rampant hospital-cost inflation, Congress passed the Tax Equity and Fiscal Responsibility Act of 1982 and the Social Security Amendments of 1983. The result of these two initiatives is the implementation of a prospective payment system (PPS) that uses diagnosis related groups (DRGs) in classifying patients and reimbursing hospitals for Medicare patients. Using the Health Care Financing Administration's (HCFA) methods (i.e., rates, weights and ICD-9-CM DRGs) for determining reimbursable amounts, this analysis examines the postulation that the typical U.S. naval hospital--if reimbursed for actual inpatient workload--would have received more than its incurred expenses. Data for three naval hospitals over a two-year period (FY83 and FY84) are used. Findings of this analysis suggest that on the average the typical naval hospital would have been reimbursed 32 percent more than actual inpatient expenses had it been reimbursed under Medicare.
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