As of 1983, Medicare began reimbursing hospitals according to Diagnostic Re¬ lated Groups (DRGs). Each DRG has a specified standard length of stay. If a patient leaves the hospital early, the hospital is favorably financially impacted, but a patient staying longer than the specified time costs the hospital money.

a. From the hospital administrator’s point of view, would you want favorable “length of stay” variances? How might you go about trying to obtain such variances?

b. From a patient’s point of view, would you want favorable “length of stay” variances? Answer this question from the point of view of a patient who has had minor surgery and from the point of view of a patient who has had major surgery.

c. Would favorable “length of stay” variances necessarily equate to high-quality care?

LO1