Medicare&#039;s New Hospital Payment System

Louise B. Russell

doi:10.5771/9780815718864

Summary

In 1983 Congress changed the way Medicare pays for hospital care. Under the new prospective payment system, hospitals are paid a fixed rate, set in advance, to cover a patient's stay. If costs are less than the fixed rates, the hospital keeps the profit; if the costs are more, it absorbs the loss. From the beginning, prospective payment was recognized as a revolutionary change in Medicare. Congress wanted a system that would make federal expenditures more predictable and controllable, and expected hospitals to respond by becoming more efficient. Some observers have hailed it as a successful way to control the spiraling costs of the Medicare program. Others have criticized it as arbitrary and a threat to the health of the elderly.

In the six years since prospective payment was introduced, a substantial amount of evidence has accumulated about its effects. Russell looks at the major characteristics of the rate payment system, how it has changed the pattern of medical service, how these changes have affected the health of the beneficiaries, and the system's effects on Medicare outlays. She reviews what is known and what needs to be learned to arrive at a valid assessment of the system. Moreover, she contributes to the larger debate on Medicare by making what are frequently quite technical evaluations accessible to the general public.

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Bibliographic data

Copyright year: 2010
ISBN-Print: 978-0-8157-7623-9
ISBN-Online: 978-0-8157-1886-4
Publisher: Rowman & Littlefield, Lanham
Language: English
Pages: 114
Product type: Book Titles

1. CONTENTS No access
1. Legislative History No access
2. What Congress Expected from Prospective Payment No access
3. What This Book Is About No access
1. What's Covered, What's Not No access
2. The Patient Classification System: Diagnosis-Related Groups No access
3. How Rates Are Calculated No access
4. The Rest of the System No access
5. Issues No access
1. Inpatient Hospital Services No access
2. Posthospital Care No access
3. Physicians' Services and Outpatient Surgery No access
1. Mortality of the Elderly under Prospective Payment No access
2. Other Measures of Quality No access
3. The Peer Review Organizations (PROs) No access
4. Quality over the Longer Term No access
1. The Hospital Insurance Trust Fund No access
2. Enrollees' Out-of-Pocket Expenses No access
3. Other Payers No access
4. Hospitals No access
1. A Preliminary Assessment No access
2. Toward Better Quality Care No access
3. The Rate-Setting System No access
4. How Much for Medical Care? No access
Notes No access Pages 93 - 110
1. A No access
2. B No access
3. C No access
4. D No access
5. E No access
6. F No access
7. H No access
8. I No access
9. L No access
10. M No access
11. N No access
12. O No access
13. P No access
14. Q No access
15. R No access
16. S No access
17. T No access
18. W No access