Do Diagnosis-Related Groups Accurately Reflect the Disease?

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Abstract
• Diagnosis-related groups (DRGs) have been mandated by the federal government to promote fiscal responsibility and insure cost containment. A retrospective analysis of demographic and cost data was conducted on 115 patients operated on for pancreatic pseudocyst. The DRG 191 criteria are as follows: major pancreas, liver plus shunt procedure; mean length of stay (LOS), 20.8 days; outlier cutoff LOS, 41 days; hospital reimbursement, $11,367.82; and day outlier rate, $86.57. The overall LOS was 34.6 days (range, one to 138 days). Sixty-six percent of the patients exceeded the DRG LOS and 37% exceeded the day outlier cutoff of 41. The number of days from admission to surgery varied from one to 65 (mean, 15.7 days). Hospital charges and DRG reimbursement were compared in 23 patients. In nine patients with a LOS of 19.9 days, DRG reimbursement exceeded charges by $34,308. In 14 patients whose charges exceeded reimbursement, the loss was $142,156. Hospital costs and LOS seem to be related to the natural history of the disease and its necessary treatment, rather than to unnecessary diagnostic procedures. Unless surgeons assess and establish medical standards, economic pressures will have a negative impact on patient care and physicians' practice. (Arch Surg1985;120:703-707)

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