Medicare-Medicaid Prospective Payment Systems for Inpatients


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The Medical Severity diagnosis-related groups (MS-DRGs) provide a list of the mean and average time of stay and processes required for diagnosis. Inpatient facilities can practice effective cost management by strictly adhering to the objectives established in the MS-DRGs.Therefore, associating patients in similar groups with the resources they are likely to use during the stay in the hospital provides an opportunity to manage cost by DRG groupings. Again, MS-DRGs are afully-package system, and therefore, the calculated fee for every DRG is paid in full for every medical service done during the inpatient stay.

  1. How do MS-DRGs encourage inpatient facilities to practice cost management?

So, the inpatient facilities accept gain or loss on the basis of the cost of offering the services.Centers for Medicare and Medicaid Services (CMS) ensures that hospitals are reimbursed for the time an MS-DRG patient stays. The CMS calculates the compensation amount to ensure that an average hospital attains the same profit margin for the services they offer irrespective of a patients MS-DRG.

The DRG system performs the refinement of severity in disease to permit cases with higher severity range to be more accordingly recompensed. Therefore, it would be logical to think that the medical community supported this initiative since they could benefit from it.Under the Medicare systems, the health centres are to be reimbursed for the length of time a Medicare patient stays in a hospital, and this might turn to be profitable for a health facility.

  1. Is the MS-DRGs approach supported by the healthcare community or is it manipulated by the providers?

Again, the implementation of DRG payment policies includes matters of equity, expenses, and management cost. The DRG system is necessary since it offers anequitable allocation of payments to compensate medical centres fairly for the efficient provision of the services. Even though the providers might have appeared to advocate for this system manipulatively, the health community could see the underlying benefits and therefore, supported it.