A bill to amend title XVIII of the Social Security Act to rationalize the payment amount under the DRG-payment system.

Amends title XVIII (Medicare) of the Social Security Act with respect to the diagnosis related group (DRG) payment system to provide that if the total operating costs for inpatient hospital services: (1) are less than or equal to the payment amount, the amount of payment with respect to such operating costs payable under part A (Hospital Insurance) of title XVIII shall be equal to the amount of such operating costs plus 50 percent of the amount by which the payment amount exceeds the amount of the operating costs; or (2) are greater than the payment amount, the amount of the payment with respect to such operating costs payable under part A shall be equal to the payment amount plus the lesser of the amount by which the amount of the operating costs exceeds the payment amount or ten percent of the payment amount. Defines the term "payment amount" to mean the total of the amounts that would otherwise be paid to a hospital without regard to this Act.