3/20/2023 0 Comments Retrospective reimbursement![]() For each group, two categories of quality measures were analyzed: outcomes and process of care. These conditions were chosen because they are severe and have high mortality rates. cerebrovascular accident (CVA), or stroke.The study team chose patients admitted for one of five conditions: This distribution across time periods allowed before-and-after comparisons among patient groups. Half of the patients were hospitalized in 19, prior to PPS, and the other half were hospitalized in 19, after PPS. They assembled a nationally representative data set containing cost, outcome, and process-of-care information on 16,758 Medicare patients hospitalized in one of 300 hospitals across five states (California, Florida, Indiana, Pennsylvania, and Texas). Instead, the RAND team undertook a massive data-collection effort. It was not possible to conduct a controlled experiment, since the entire country was placed under PPS at the same time. Gauging the effects of PPS proved to be challenging. However, Medicare patients were more likely to be discharged in unstable condition, which was associated with a higher rate of mortality, even though overall mortality fell. It found that, overall, PPS had no negative effect on patient outcomes and did not alter an already existing trend toward improved processes of care. However, because it contained incentives for hospitals to shorten stays and to choose the least expensive methods of care, PPS raised concerns about possible declines in the quality of care for hospitalized Medicare patients.Ī study conducted jointly by RAND and the University of California, Los Angeles, examined the question of how the PPS reform affected the quality of hospital care for Medicare patients. PPS proved effective at curbing cost growth. Under PPS, hospitals receive a fixed amount for treating patients diagnosed with a given illness, regardless of the length of stay or type of care received. The governing agency, the Health Care Financing Administration, switched from a retrospective fee-for-service system to a prospective payment system (PPS). Determining the seriousness of this problem requires further monitoring and study.įaced with sharply escalating Medicare costs in the early 1980s, the federal government completely revised the way Medicare pays hospitals for treating elderly patients. However, more Medicare patients were discharged from hospitals in unstable condition after PPS was implemented.Mortality rates declined for all patient groups examined, and other outcome measures also showed improvement.Medicare’s prospective payment system (PPS) did not lead to significant declines in the quality of hospital care.
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