Casemix classification systems

The idea of using casemix classification to manage hospital services is not new, but has been limited by available technology. It was not until after the introduction of Medicare in the United States in 1965 that serious attempts were made to measure hospital production in order to contain spiralling costs. This resulted in a system of casemix classification known as diagnosis related groups (DRGs). This paper traces the development of DRGs and their evolution from the initial version to the All Patient Refined DRGs developed in 1991.