# § 1101. Resource allocation methods: capitation or diagnosis-related groups
**(a)** **Establishment of Capitation or DRG Method.—** The Secretary of Defense, after consultation with the other administering Secretaries, shall establish by regulation the use of capitation or diagnosis-related groups as the primary criteria for allocation of resources to facilities of the uniformed services.
**(b)** **Exception for Mobilization Missions.—** Capitation or diagnosis-related groups shall not be used to allocate resources to the facilities of the uniformed services to the extent that such resources are required by such facilities for mobilization missions.
**(c)** **Content of Regulations.—** Such regulations may establish a system of diagnosis-related groups similar to the system established under section 1886(d)(4) of the Social Security Act (42 U.S.C. 1395ww(d)(4)). Such regulations may include the following:
**(1)** A classification of inpatient treatments by diagnosis-related groups and a similar classification of outpatient treatment.
**(2)** A methodology for classifying specific treatments within such groups.
**(3)** An appropriate weighting factor for each such diagnosis-related group which reflects the relative resources used by a facility of a uniformed service with respect to treatments classified within that group compared to treatments classified within other groups.
**(4)** An appropriate method for calculating or estimating the annual per capita costs of providing comprehensive health care services to members of the uniformed services on active duty and covered beneficiaries.
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**Source Credit**: (Added Pub. L. 99–661, div. A, title VII, § 701(a)(1), Nov. 14, 1986, 100 Stat. 3897; amended Pub. L. 100–456, div. A, title XII, § 1233(e)(1), Sept. 29, 1988, 102 Stat. 2057; Pub. L. 103–160, div. A, title VII, § 714(a), (b)(1), Nov. 30, 1993, 107 Stat. 1690.)
## Editorial Notes
### Amendments
1993—, substituted “Resource allocation methods: capitation or diagnosis-related groups” for “Diagnosis-related groups” as section catchline.
Subsec. (a). , substituted “Capitation or DRG Method” for “DRGs” in heading and inserted “capitation or” before “diagnosis-related groups” in text.
Subsec. (b). , substituted “Capitation or diagnosis-related groups” for “Diagnosis-related groups”.
Subsec. (c). , substituted “may” for “shall” in two places in introductory provisions and added par. (4).
1988—Subsec. (c). struck out “(1)” before “Such regulations” in introductory provisions.
## Statutory Notes and Related Subsidiaries
### Regulations
> “The regulations required by
>
> , United States Code, to establish the use of diagnosis-related groups as the primary criteria for the allocation of resources to health care facilities of the uniformed services shall be prescribed to take effect not later than
>
> , in the case of outpatient treatments.”
, , , as amended by , , , provided that:
> **“(A)** in the case of inpatient treatments, not later than October 1, 1988; and
>
> **“(B)** in the case of outpatient treatments, not later than October 1, 1989.”
, , , as amended by , , , provided that: