In May 2024, Blue Cross Blue Shield of Massachusetts (BCBSMA) plans to switch to using version 40 of 3M Co.’s All Patient Refined Diagnosis Related Groups (APR DRG) classification system. The organization currently uses version 34. BCBSMA asked Milliman to prepare this report to document the data sources, assumptions, and methodologies supporting our simulation of payments for certain commercial inpatient hospital services provided by in-network acute care hospitals using version 40. The paper is organized as follows: 

• Background on 3M’s APR DRG system
• Methodology with respect to base data, APR DRG assignment, and other items 
• Data reliance and variability of results