Hospital X and Hospital Y Are Both Paid by Medicare

Hospital X and Hospital Y are both paid by Medicare using the DRG methodology. Assume that the reimbursement for the average Medicare patient (case weight of 1.0) is $3,000. Hospital X has a patient case-mix index of 1.25 and admits 36 patients who stay in the hospital a total of 100 days. Hospital Y. has a patient case-mix of 0.90 and admits 48 patients who stay in the hospital a total of 200 days. Hospital Y gets paid more per day than does Hospital X.