Hospital Inpatient

Inpatient payments include two methods of reimbursement: per diem and all patient refined – diagnosis related groups (APR-DRGs). Per diem reimbursed hospitals include rehabilitation hospitals and distinct part units, psychiatric hospitals and distinct part units, specialty children's hospitals, and long-term stay hospitals. Under per diem methodology, hospitals receive a flat rate for each day of inpatient services provided.

Under APR-DRG, the department reimburses the hospital based on the diagnoses and procedures performed during the hospital stay. The diagnoses associated with the hospital stay are placed into groups requiring a similar intensity of services.

The APR-DRG reimbursement, like the system used by the federal Medicare program, is based on the average cost of providing services for the specific diagnosis group, regardless of how long a specific client may have been in the hospital.

The department does adjust payments for exceptionally high costs.​