Psychiatric units in general hospitals are exempt from diagnosis-
related groups (DRGs), a system of per case prospective payment that is
used for the majority of patients covered by Medicare. The American
Psychiatric Association purchased a large hospital discharge data base and
studied the potential impact of DRGs on psychiatric patients and inpatient
psychiatric units in general hospitals. There was substantial inaccuracy in
the psychiatric DRGs' prediction of resource use, which could lead to
inappropriate discharge of patients and financial risk to hospitals that
treat more severe cases. The authors advocate further research because
psychiatry must anticipate prospective payment in the future.
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