DRG payment for long-term ventilator patients. Implications and recommendations

Area of Science:

• Health Economics
• Healthcare Policy

Background:

• Medicare Prospective Payment System (PPS) concerns regarding patient access to care.
• Diagnosis-Related Group (DRG) payment structure's financial implications.
• Limited research on financial impact for chronic ventilator-dependent patients.

Purpose of the Study:

• To analyze the financial impact of DRG payments on chronic ventilator-dependent Medicare patients.
• To assess potential access to care issues stemming from DRG reimbursement.

Main Methods:

• Retrospective analysis of 95 Medicare patients requiring continuous ventilator treatment for at least three days.
• Calculation of payments versus costs for these patients over a one-year period.
• Exclusion of patients with surgical intensive care unit stays.

Main Results:

• A total loss of $2.2 million below costs was observed for the studied patient cohort.
• An average loss of $23,129 per discharge was calculated.
• Patients averaged 26.6 days of stay, with 14.2 days on a ventilator.

Conclusions:

• The DRG system demonstrates a financial bias against chronic ventilator-dependent patients.
• This bias may lead to significant access-to-care challenges.
• Recommendations for DRG payment system adjustments and further large-scale analysis are proposed.