Preparing for Medicare's APC system

The imminent arrival of Medicare's Ambulatory Payment Classification (APC) system, HCFA's new outpatient prospective payment system (PPS), is expected to have as significant an effect on outpatient health care as the Diagnosis-Related Groups (DRG) system had on inpatient health care when it was launched in the early 1980s. Unlike the inauguration of the DRG system, however, the APC program is not expected to be as forgiving to organizations unprepared to implement the new prospective payment system. Since the APC program will be put into effect, HCFA says, "as soon as possible after January 1, 2000," healthcare financial managers should be preparing now.