The Effect of the Perspective Payment System on the Productivity on Short-Term General and Special Hospitals

[摘要] Until October 1, 1983, hospitals were reimbursed by a retrospective payment system. This cost-based reimbursement provided no incentives for the hospital industry to operate in a productive or efficient manner. As a result, hospitalization costs soared and exceeded overall yearly inflation by as much as three times. On October 1, 1983, the Federal Government instituted a Prospective Payment System for hospital reimbursement for Medicare patients. Hospitals received a fixed payment based on the patient;;s diagnosis. Diagnostic Related Groups combined all diagnoses that utilized similar medical resources and the fixed payment was based on that resource utilization. The Prospective Payment System with Diagnostic Related Group reimbursement was designed to decrease the accelerating cost of hospitalization and to force the hospital industry to become more productive and efficient in providing patient care. This study compares hospital productivity in the years prior to and after the implementation of the Prospective Payment System to determine what changes have occurred as a result of the new reimbursement policy.

[发布机构] University of Michigan

[效力级别] Medicare

[关键词] Prospective Payment System;Medicare;Diagnostic Related Group;hospitalization;cost;Public Administration