Understanding diagnostic related groups (DRGs) and inpatient hospital reimbursement

Knowing insurance plan regulations and complying precisely with requirements is critical for hospital reimbursement of care provided. Diagnostic related groups provide guidelines widely used in the United States to determine hospital reimbursement by Medicare, Medicaid, and many insurance providers. Because hospitals are the largest employers of nurses, nurses have a responsibility and interest in contributing to the stability of their hospital's financial status to protect incomes and job security. This article provides an overview of diagnostic related groups and demonstrates how nurses can contribute to more accurate documentation outcomes that determine hospital reimbursement.