DRGs, orthopedic surgery, and age at an academic medical center

Abstract

The federal Medicare Diagnostic Related Group (DRG) hospital reimbursement system has been on line for 5 years. Hospitals contend that profit margins have dropped to dangerously low levels, due to the federal DRG Prospective Payment System. The authors analyzed all orthopedic surgical admissions to a large academic medical center under DRG reimbursement and characterized patients by age, resource utilization, and outcome. Total costs for the 1,040 orthopedic patients analyzed during a 15-month period added up to $9,718,800. Mean hospital cost per patient, mean hospital length of stay, percent outliers, and mortality generally increased with age. All age categories of patients 65 years of age and above generated financial losses under DRGs. Older orthopedic patients consumed a disproportionately larger share of resources than younger patients, and were more frequent users of the SICU and blood. The current DRG reimbursement scheme may be inequitable in relation to the older orthopedic surgery patient. If these findings are demonstrated at other medical centers, older orthopedic surgical patients could be limited in both their access and quality of care in the future.