Health care financing policy for hospitalized pediatric patients
E. Munoz, D. Chalfin, J. Goldstein, R. Lackner, K. Mulloy and L. Wise
Department of Surgery, Long Island Jewish Medical Center, New Hyde Park, NY 11042.
Prospective hospital payment systems using the federal Medicare DRG payment
model are changing hospital reimbursement. Currently, many states have
adopted diagnosis related group (DRG) prospective "all payer systems" using
the federal model. All payer systems, whereby Medicaid, Blue Cross, and
other commercial insurers pay by the DRG mode, prevent cost shifting
between payers. New York state has used an all payer system since Jan 1,
1988. This study simulated DRG all payer methods for a large sample (N =
16,084) of pediatric patients for a three-year period using the New York
DRG all payer reimbursement system now in effect. Medicaid pediatric
patients had (adjusted for DRG weight index) a longer hospital stay and
greater total hospital cost compared with pediatric patients from Blue
Cross and other commercial payers. Medicaid pediatric patients also had a
greater severity of illness compared with patients from Blue Cross and
other payers. Pediatric patients in all payment groups (ie, Medicaid, Blue
Cross, and other commercial insurers) generated financial risk under the
DRG all payer scheme. Medicaid pediatric patients generated the greatest
financial risk, however. These data suggest that state and private payers
may be under-reimbursing for the care of the hospitalized pediatric patient
using the DRG prospective hospital payment scheme. Health care financing
policy for pediatric patients may limit both access and quality of care.
