Am J Psychiatry 1991; 148:888-891
Copyright © 1991 by American Psychiatric Association
Psychiatric inpatient care in the VA: before, during, and after DRG- based budgeting
R Rosenheck and L Massari
Northeast Program Evaluation Center, West Haven VA Medical Center, CT 06516.
OBJECTIVE: The authors examined the impact of budgeting based on
diagnosis-related groups (DRGs) on inpatient psychiatric care in Department
of Veterans Affairs (VA) medical centers. DRG-based budgeting was
implemented by the VA in 1984 and suspended in 1988. METHOD: Computerized
discharge abstracts were obtained for all episodes of VA inpatient care
occurring from 1980 through 1989. The number of discharges per year, number
of unduplicated patients treated, mean length of stay, total number of bed
days of care per unique patient per year, readmission rates, and number of
episodes of care per operational bed were determined for psychiatric and
nonpsychiatric (medical- surgical) hospitalizations occurring before,
during, and after DRG- based budgeting was in effect. RESULTS: In the case
of VA psychiatric care, DRG-based budgeting was associated with more
episodes of care, shorter lengths of stay, higher readmission rates, and
more episodes of care per occupied bed. DRG-based budgeting had similar
effects on medical-surgical care, although an increase in the number of
episodes of care was not observed. During the first year after this funding
mechanism was suspended, changes in both psychiatric and medical- surgical
care that were related to DRG-based budgeting were slowed and, in some
cases, reversed. CONCLUSIONS: Both psychiatric and medical- surgical
inpatient care in the VA were sensitive to changes in funding mechanisms.
These changes were generally similar to those observed in psychiatric care
provided by non-VA hospitals reimbursed under Medicare's DRG-based
prospective payment system.
