Comments on HCFA Regional Office Report on New Jersey's Diagnostic Related Group Prospective Reimbursement Experiment

HRD-83-63: Published: Jun 15, 1983. Publicly Released: Jul 12, 1983.

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GAO was asked to review a report by the Health Care Financing Administration's (HCFA) New York Regional Office on New Jersey's Diagnostic Related Group hospital prospective payment experiment and to assess the relevance of its findings and recommendations to the administration's proposed Medicare hospital prospective payment system.

GAO found that the administration's proposed bill was very general and would have granted the Secretary of Health and Human Services (HHS) broad authority to design, implement, and operate the system. Therefore, whether the proposal, if enacted, would have addressed the problems discussed in the HCFA Regional Office report would have depended largely on actions taken by HHS in establishing and operating the payment system. Congress included features in P.L. 98-21 which attempt to address concerns like those expressed in the HCFA Regional Office report.

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