What impact will DRGs have on group practice?

The US Congress has approved a prospective payment plan for Medicare using DRGs, which becomes effective October 1, 1983. This article explains DRGs, demonstrates the specific ways DRGs may affect group practice physicians, and discusses how group practices can avoid being adversely affected. A brief history of the DRG concept is presented along with a discussion of the evolution of DRGs and case-mix reimbursement. Actions hospital administrators are taking relative to the new reimbursement plan and the impact these actions will have on medical groups are examined.