Data quality and DRGs: an assessment of the reliability of federal beneficiary discharge data in selected Manhattan hospitals.

New York County Health Services Review Organization (NYCHSRO), the physicians' professional standards review organization of Manhattan, examined whether diagnostic coding errors identified in Manhattan hospitals would affect reimbursement under a diagnostic-related group (DRG) method of financing inpatient services. A sampling of 1,027 Medicare and Medicaid cases representing discharges from 18 Manhattan hospitals during 1982 and 1983 revealed incorrect DRG assignment for 17.5% of patient record abstracts, but these appear to have been unsystematic rather than deliberate errors. The difference between estimated reimbursement based on original and reabstracted records was not statistically significant either in the aggregate or for specific hospitals. It is emphasized that while New York State's Prospective Hospital Reimbursement Methodology (in effect during the study period) is not solely dependent upon DRG's case-mix is one of several factors used to make adjustments to existing per diem rates. A key recommendation is that hospitals conduct internal monitorings with all involved departments to improve the quality of the data abstracting process.