What is DRG Payment?

Diagnosis-Related Group (DRG) payment is a fixed reimbursement system for hospital inpatient services based on patient diagnosis, procedures performed, age, gender, and discharge status. Under this system, hospitals receive a predetermined amount for treating patients with specific conditions, regardless of actual costs incurred. Medicare and many private insurers use DRGs to control costs and encourage efficient hospital care.

Why DRG payment matters

• Controls hospital costs: Incentivizes efficient resource use during admissions
• Standardizes reimbursement: Creates consistent payments for similar cases
• Affects length of stay: Encourages appropriate discharge timing

How Solace can help

A Solace advocate can help you understand how DRG payments affect your hospital bills, ensure proper coding for maximum reimbursement, and address concerns about premature discharge due to DRG constraints. Advocates can also assist with appeals if DRG assignments seem incorrect.