DRGs: a new era for health care

The DRG system classifies patients according to their resource consumption, based on their medical diagnosis. It was originally developed at Yale University and later studied in New Jersey. This resulted in its implementation as a pricing system. It incorporates the clinical and financial information, through the use of the patient record, resulting in the generation of information for managers to use in making decisions to run their operations. Although it began as the Medicare prospective pricing system for acute inpatient settings, it has extended to other third party payers and beyond the hospital. The changes and challenges that this new system has brought about has presented numerous opportunities for nursing.