What was a primary outcome of the introduction of Diagnosis-Related Groups (DRGs) in hospitals?

The introduction of Diagnosis-Related Groups (DRGs) fundamentally altered the way hospitals receive reimbursement for patient care. One significant outcome was the shift of patients to home and other facilities following their hospital stays. This shift occurred because DRGs incentivized hospitals to reduce the length of patient stays to control costs and maximize efficiency under a fixed payment system. When hospitals are paid a predetermined amount based on the patient's diagnosis, there is an economic motivation to discharge patients more quickly, with follow-up care transitioning to home health services or other rehabilitation facilities. This restructuring helped in managing healthcare costs while ensuring that patients who are stable and require less intensive care could receive appropriate services outside of an acute care setting. Thus, this outcome reflects the broader trend towards more efficient service delivery and integration of care across different levels and settings.