Question

how does severity of illness impact healthcare payment systems?

Answer 1

The goal of MS-DRG system is to improve medicares ability to recognize severity of illness in its inpatient hospital payments. The new system is projected to increase payments to hospitals for services provided to sicker patients and decrease patients for treating less severely ill patients. A hospital qualifies for a disproportionate share hospital adjustment if the hospital treats a high percentage of low-income patients and if a hospital is located in an urban setting with more than 100beds and recieves more than 30%of the hospitals net revenue from state and other local government sources for indigent care.