Psychoses: Inpatient Reimbursement Overview

DRG 885 encompasses inpatient admissions for psychotic disorders such as schizophrenia and acute psychoses, focusing on psychiatric stabilization and management. Accurate coding and documentation of comorbidities and severity influence Diagnosis-Related Group assignment and therefore Medicare inpatient reimbursement.

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DRG 885 Overview

DRG 885 covers inpatient admissions for primary psychiatric psychoses, including schizophrenia spectrum and other acute psychotic disorders that require hospital-level stabilization and treatment. This Diagnosis-Related Group aggregates cases where psychiatric symptoms are the principal reason for admission and resource use is primarily behavioral health interventions, medication management, and safety monitoring. It matters for Medicare payment because the Diagnosis-Related Group assignment drives reimbursement levels tied to diagnosis coding, comorbid conditions, and length of stay, affecting hospital revenue for mental health care.

National Payment Rates

Across payers the observed rate range runs roughly from $370 up to $36K, with the widest spread between the minimum and maximum observed values ($370 to $36K). Review the payer table and accompanying chart below for payer-specific percentiles and distributions. The greatest dispersion appears driven by Cigna and Aetna high-end values compared with lower BCBS and Anthem medians.

The CMS 2023 data represent national Medicare fee-for-service inpatient payments under the CMS Provider Utilization and Payment Data program. The table below shows average total payment, average submitted covered charges, average Medicare payment amount, and total discharges for DRG 885. These values reflect national-level FFS Medicare payment and utilization for 2023.

Average Total Payment	Average Submitted Charges	Average Medicare Payment	Total Discharges
$13K	$41K	$11K	44K

Patient Population

This DRG’s inpatient population includes both Medicare-age and working-age patients, representing a mixed payer mix rather than being predominantly Medicare-only. Medicare enrollees contribute a substantial portion of discharges due to the age-related coverage in the Medicare program, while private/commercial payers (e.g., Blue Cross Blue Shield, Cigna, Aetna, Anthem) account for a meaningful share of working-age admissions. Overall, the population skews mixed between Medicare-age and working-age patients rather than exclusively one group.

State Payment Rates

State: Alaska1 / 49

Alaska Benchmarks

Payer rates for DRG 885 in Alaska span from a low mean of 17K (Anthem and Blue Cross Blue Shield) to a high mean of 26K (Cigna), with payer-specific medians ranging roughly from 15K up to 22K. Cigna’s mean of 26K stands out as meaningfully higher than national Cigna benchmarks, while Anthem and Blue Cross Blue Shield sit closer to or above national medians for their payers. See the table and chart below for detailed distributions by payer.

Key Insights for Alaska

Cigna is the highest-paying payer in Alaska with a mean of 26K, while Anthem/Blue Cross Blue Shield are the lowest among listed payers with means of 17K.
Alaska’s payer means skew higher than national medians for some payers (Cigna’s mean of 26K notably exceeds national Cigna mean of 15K), indicating a meaningful upward deviation versus national rates.

Clinical Trials

Acute inpatient intervention trials focusing on rapid symptom stabilization and reduction of psychotic features: these studies evaluate short-term pharmacologic strategies, electroconvulsive therapy protocols, or intensive psychiatric nursing interventions delivered during the index hospitalization for acute psychosis. The patient population is adults (and sometimes adolescents) admitted with florid psychotic symptoms, agitation, or safety risks requiring inpatient psychiatric care, and the objective is to shorten time-to-stability and reduce complications such as self-harm or need for restraint. This research is relevant to providers for optimizing acute clinical pathways and to payers because faster stabilization can reduce length of stay and resource utilization within the DRG.
Comparative effectiveness and safety studies of maintenance strategies to prevent relapse after discharge: these outpatient-initiated or transitional trials compare different maintenance antipsychotic regimens, psychosocial interventions (e.g., assertive community treatment, targeted psychotherapy), or integrated care models for patients recently discharged from inpatient care for psychosis. The population includes patients with first-episode psychosis or recurrent psychotic disorders transitioning from inpatient to community care, and the focus is on relapse rates, readmissions, functional outcomes, and adverse events over months to years. Findings inform clinicians and payers about which long-term management approaches reduce rehospitalization and downstream costs associated with DRG readmissions and chronic disability.
Service delivery and quality improvement trials targeting inpatient-to-community continuity of care and social determinants: pragmatic trials test enhanced discharge planning, coordinated follow-up (timely outpatient appointments, medication reconciliation), housing or employment supports, and mobile crisis teams for high-utilizer psychosis patients. These studies enroll individuals with complex needs (co-occurring substance use, medical comorbidities, homelessness) who historically have high inpatient utilization and frequent readmissions, measuring outcomes such as 30- and 90-day readmission rates, emergency department visits, and patient-reported recovery metrics. Results are directly relevant to hospital administrators and payers seeking to reduce costly readmissions under the DRG umbrella and to improve overall care quality and resource allocation for this vulnerable population.

O.R. Procedures with Principal Diagnosis of Mental Illness: Inpatient Reimbursement Overview

880-ACUTE-ADJUSTMENT-REACTION-AND-PSYCHOSOCIAL-DYSFUNCTION

Acute Adjustment Reaction and Psychosocial Dysfunction: Inpatient Reimbursement Overview

881-DEPRESSIVE-NEUROSES

Depressive Neuroses: Inpatient Reimbursement Overview

882-NEUROSES-EXCEPT-DEPRESSIVE

Neuroses Except Depressive: Inpatient Reimbursement Overview

883-DISORDERS-OF-PERSONALITY-AND-IMPULSE-CONTROL

Disorders of Personality and Impulse Control: Inpatient Reimbursement Overview

884-ORGANIC-DISTURBANCES-AND-INTELLECTUAL-DISABILITY

Organic Disturbances and Intellectual Disability: Inpatient Reimbursement Overview

886-BEHAVIORAL-AND-DEVELOPMENTAL-DISORDERS

Behavioral and Developmental Disorders: Inpatient Reimbursement Overview

887-OTHER-MENTAL-DISORDER-DIAGNOSES

Other Mental Disorder Diagnoses: Inpatient Reimbursement Overview

References

1.CPT® Codes and Descriptions. AAPC. Retrieved Aug 11, 2026.Maintains the CPT code set's official descriptions and guidelines, licensed from the American Medical Association, used as the definitional source for CPT codes on this page.
2.HCPCS Quarterly Update. Centers for Medicare & Medicaid Services (CMS). Retrieved Aug 11, 2026.CMS's quarterly release of HCPCS Level II codes and short/long descriptors, the source for HCPCS code definitions and update history.
3.ICD-10-CM Full Code List. Centers for Medicare & Medicaid Services (CMS). Retrieved Aug 11, 2026.CMS's complete ICD-10-CM diagnosis code list, used to cross-reference diagnosis codes associated with this procedure or service.

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National Payment Rates

Mean Rates by Payer — National — DRG 885

Average Total Payment	Average Submitted Charges	Average Medicare Payment	Total Discharges
$13K	$41K	$11K	44K

Patient Population

State Payment Rates

State: Alaska1 / 49

Alaska Benchmarks

Mean Rates by Payer — Alaska — DRG 885

Key Insights for Alaska

Cigna is the highest-paying payer in Alaska with a mean of 26K, while Anthem/Blue Cross Blue Shield are the lowest among listed payers with means of 17K.
Alaska’s payer means skew higher than national medians for some payers (Cigna’s mean of 26K notably exceeds national Cigna mean of 15K), indicating a meaningful upward deviation versus national rates.

Clinical Trials

Acute inpatient intervention trials focusing on rapid symptom stabilization and reduction of psychotic features: these studies evaluate short-term pharmacologic strategies, electroconvulsive therapy protocols, or intensive psychiatric nursing interventions delivered during the index hospitalization for acute psychosis. The patient population is adults (and sometimes adolescents) admitted with florid psychotic symptoms, agitation, or safety risks requiring inpatient psychiatric care, and the objective is to shorten time-to-stability and reduce complications such as self-harm or need for restraint. This research is relevant to providers for optimizing acute clinical pathways and to payers because faster stabilization can reduce length of stay and resource utilization within the DRG.
Comparative effectiveness and safety studies of maintenance strategies to prevent relapse after discharge: these outpatient-initiated or transitional trials compare different maintenance antipsychotic regimens, psychosocial interventions (e.g., assertive community treatment, targeted psychotherapy), or integrated care models for patients recently discharged from inpatient care for psychosis. The population includes patients with first-episode psychosis or recurrent psychotic disorders transitioning from inpatient to community care, and the focus is on relapse rates, readmissions, functional outcomes, and adverse events over months to years. Findings inform clinicians and payers about which long-term management approaches reduce rehospitalization and downstream costs associated with DRG readmissions and chronic disability.
Service delivery and quality improvement trials targeting inpatient-to-community continuity of care and social determinants: pragmatic trials test enhanced discharge planning, coordinated follow-up (timely outpatient appointments, medication reconciliation), housing or employment supports, and mobile crisis teams for high-utilizer psychosis patients. These studies enroll individuals with complex needs (co-occurring substance use, medical comorbidities, homelessness) who historically have high inpatient utilization and frequent readmissions, measuring outcomes such as 30- and 90-day readmission rates, emergency department visits, and patient-reported recovery metrics. Results are directly relevant to hospital administrators and payers seeking to reduce costly readmissions under the DRG umbrella and to improve overall care quality and resource allocation for this vulnerable population.

O.R. Procedures with Principal Diagnosis of Mental Illness: Inpatient Reimbursement Overview

880-ACUTE-ADJUSTMENT-REACTION-AND-PSYCHOSOCIAL-DYSFUNCTION

Acute Adjustment Reaction and Psychosocial Dysfunction: Inpatient Reimbursement Overview

881-DEPRESSIVE-NEUROSES

Depressive Neuroses: Inpatient Reimbursement Overview

882-NEUROSES-EXCEPT-DEPRESSIVE

Neuroses Except Depressive: Inpatient Reimbursement Overview

883-DISORDERS-OF-PERSONALITY-AND-IMPULSE-CONTROL

Disorders of Personality and Impulse Control: Inpatient Reimbursement Overview

884-ORGANIC-DISTURBANCES-AND-INTELLECTUAL-DISABILITY

Organic Disturbances and Intellectual Disability: Inpatient Reimbursement Overview

886-BEHAVIORAL-AND-DEVELOPMENTAL-DISORDERS

Behavioral and Developmental Disorders: Inpatient Reimbursement Overview

887-OTHER-MENTAL-DISORDER-DIAGNOSES

Other Mental Disorder Diagnoses: Inpatient Reimbursement Overview

References

1.CPT® Codes and Descriptions. AAPC. Retrieved Aug 11, 2026.Maintains the CPT code set's official descriptions and guidelines, licensed from the American Medical Association, used as the definitional source for CPT codes on this page.
2.HCPCS Quarterly Update. Centers for Medicare & Medicaid Services (CMS). Retrieved Aug 11, 2026.CMS's quarterly release of HCPCS Level II codes and short/long descriptors, the source for HCPCS code definitions and update history.
3.ICD-10-CM Full Code List. Centers for Medicare & Medicaid Services (CMS). Retrieved Aug 11, 2026.CMS's complete ICD-10-CM diagnosis code list, used to cross-reference diagnosis codes associated with this procedure or service.

Published by

Trek Health powers OpenPayer with a leading commercial payer intelligence platform, seamlessly converting fragmented payer data into actionable insights for provider organizations.

Psychoses: Inpatient Reimbursement Overview

Sign up for drg 885 policy alerts

DRG 885 Overview

Psychoses: Inpatient Reimbursement Overview

Sign up for drg 885 policy alerts

DRG 885 Overview

National Payment Rates

Patient Population

State Payment Rates

Alaska Benchmarks

Key Insights for Alaska

Clinical Trials

Related Codes

References

National Payment Rates

Patient Population

State Payment Rates

Alaska Benchmarks

Key Insights for Alaska

Clinical Trials

Related Codes

References