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Advocate the Implementation of a Severity-Based Medicare DRG System
As it has for more than a decade, NAUH will continue to advocate the implementation of a severity-based DRG system that will better reflect the severity of illness of Medicare patients and adjust Medicare payments accordingly. After years of prodding by NAUH and an additional push from MedPAC, CMS last year proposed an entirely new, severity-based DRG system for Medicare. Unfortunately, while NAUH supported the concept, it joined most of the hospital industry in concluding that the execution was flawed. In NAUH's view, CMS's proposed severity-adjusted DRG system was a truncated version of a true severity-based DRG system that inappropriately consolidated many DRGs and was integrated with new, hospital-specific relative value weights that were ill-conceived and then inaccurately calculated. Opposition to the flawed system was so great that CMS withdrew its proposal and is now reexamining its approach.
CMS intends to try again in 2007. NAUH will continue to advocate the full-scale adoption of a true severity-based Medicare DRG system that does not have the flaws of last year's proposal. NAUH also will analyze whatever changes CMS proposes and forcefully advocate the interests of urban safety-net hospitals based on the outcome of that analysis.
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