Medicare discharges by facility status under the prospective payment system, 1984-86

Area of Science:

• Health Care Policy
• Hospital Reimbursement Systems
• Health Services Research

Background:

• The Health Care Financing Administration introduced the Medicare prospective payment system (PPS) to reform hospital reimbursement.
• Certain hospitals and units were excluded from PPS and continued under the reasonable cost reimbursement system with target rate limits.

Purpose of the Study:

• To examine changes in hospital classification and utilization patterns following the implementation of PPS.
• To analyze data on excluded facilities and patient discharges during the initial years of PPS (fiscal years 1984-86).

Main Methods:

• Analysis of excluded facility counts.
• Examination of discharge data by facility status under PPS.
• Review of data for fiscal years 1984 through 1986.

Main Results:

• The study identified shifts in how hospitals were classified after PPS implementation.
• Changes in patient discharge patterns were observed among facilities excluded from PPS.
• Data from fiscal years 1984-86 illustrate these evolving trends.

Conclusions:

• The implementation of PPS influenced hospital classifications and utilization dynamics.
• Excluded facilities experienced distinct changes in their operational and discharge patterns.
• Understanding these shifts is crucial for evaluating the broader impact of Medicare reimbursement reforms.