Search PubMed⌕ Search

SEARCH · Search PubMed

Results for “Prospective Payment System”

Search indexed PubMed citations on genomics, clinical trials, systematic reviews and public health. Explore titles, authors and supplied subject terms, then open the PubMed record.

Quote a phrase for an exact phrase match. Source license links do not imply unrestricted reuse.

At least 19 recordsLinked to original sources
PubMed1992

Medicare reimbursement accuracy under the prospective payment system, 1985 to 1988.

BACKGROUND: Hospital reimbursement by Medicare's prospective payment system depends on accurate identification and coding of inpatients' diagnoses and procedures using the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM). A previous study showed that 20.8% +/- 0.5% (mean +/- SE) of hospital bills for 1985 contained errors that changed their diagnosis related group (DRG) and that a significant 61.6% +/- 1.3% of errors overreimbursed the hospitals. This DRG "creep" improperly increased net reimbursement by 1.9%, +308 million when projected nationally. The present study updated our previous study with 1988 data. METHODS: The Office of Inspector General, US Department of Health and Human Services, obtained a simple random sample of 2451 hospital charts for Medicare discharges from 1988. The American Medical Record Association reabstracted the ICD-9-CM codes on a blinded basis, grouped them to DRGs, and determined the reasons for discrepancies. RESULTS: Coding errors declined to 14.7% +/- 0.7% in 1988, and a nonsignificant 50.7% +/- 2.6% of DRG errors overreimbursed the hospitals. Projected nationally, hospitals did not receive a significant overreimbursement. Physician misspecification of the narrative diagnoses underreimbursed the hospitals, while billing department resequencing overreimbursed them. CONCLUSIONS: The attestation requirement may have deterred DRG creep due to attending physician upcoding, but the peer review organizations' sentinel effect and educational activities have not eliminated hospital resequencing.

Abstracting and Indexing↗
PubMed1990

Quality of care before and after implementation of the DRG-based prospective payment system. A summary of effects.

In this series we have described changes in the quality of care that have occurred in the treatment of hospitalized elderly Medicare patients with one of five conditions between 1981-1982 and 1985-1986. In this article we report on a mortality analysis, patient and hospital subgroup comparisons, and time series studies we have conducted in an attempt to determine whether changes in quality of care can be linked causally to the introduction of the prospective payment system. Based on these analyses we conclude that (1) mortality following hospitalization has been unaffected by the introduction of the prospective payment system, and improvements in in-hospital processes of care that began prior to the prospective payment system have continued after its introduction, but (2) the prospective payment system has increased the likelihood that a patient will be discharged home in an unstable condition. We recommend that efforts to correct this problem be intensified and that clinical monitoring of the impact of the prospective payment system continue as hospital cost-containment pressures intensify.

Continuity of Patient Care↗
PubMed1990

Measuring quality of care with explicit process criteria before and after implementation of the DRG-based prospective payment system.

We developed explicit process criteria and scales for Medicare patients hospitalized with congestive heart failure, myocardial infarction, pneumonia, cerebrovascular accident, and hip fracture. We applied the process scales to a nationally representative sample of 14,012 patients hospitalized before and after the implementation of the diagnosis related group-based prospective payment system. For the four medical diseases, a better process of care resulted in lower mortality rates 30 days after admission. Patients in the upper quartile of process scores had a 30-day mortality rate 5% lower than that of patients in the lower quartile. The process of care improved after the introduction of the prospective payment system; eg, better nursing care after the introduction of the prospective payment system was associated with an expected decrease in 30-day mortality rates in pneumonia patients of 0.8 percentage points, and better physician cognitive performance was associated with an expected decrease in 30-day mortality rates of 0.4 percentage points. Overall, process improvements across all four medical conditions were associated with a 1 percentage point reduction in 30-day mortality rates after the introduction of the prospective payment system.

Aged↗
PubMed1989

Profits and fiscal pressure in the prospective payment system: their impacts on hospitals.

For hospitals that were under Medicare's Prospective Payment System (PPS) for one and two years in their 1985 fiscal year, this paper examines how variation in the fiscal pressure PPS imposed affected expenditures and other aspects of behavior. The analysis shows that in hospitals' second as well as first year on PPS, hospitals under greater pressure experienced greater behavioral change. However, second year changes were far smaller than changes in the system's first year. Evidence that variation in pressure reflects factors in addition to hospitals' relative efficiency and may undermine rather than promote appropriate cost containment leads the authors to propose modifications in PPS methods.

Costs and Cost Analysis↗
PubMed1989

An analysis of the Prospective Payment System's labor-nonlabor share by diagnosis-related group.

When Congress in 1983 legislated a new Prospective Payment System (PPS) for Medicare hospital payment, the payment algorithm was founded on a simplifying assumption of a constant 80-20 percentage share of labor and nonlabor costs across all diagnosis-related groups (DRGs). Using Medicare claims data and hospital cost reports, this study examines the accuracy of this assumption. While a few DRGs are found to vary significantly from the norm, a systematic cancelling out of high and low labor-intensive DRGs results in no material PPS payment bias at the hospital level. Indeed, rural hospitals, if anything, benefit by the assumption. A very small number of outlier DRGs and hospitals are troublesome, nonetheless, implying fine-tuning of the algorithm.

Diagnosis-Related Groups↗
PubMed1991

Use of inpatient psychiatric care at a VA medical center after implementation of a prospective payment system.

A retrospective audit of patients' utilization of inpatient psychiatric care at a Department of Veterans Affairs medical center before and after implementation of a prospective payment system compared patterns of utilization by chronic and nonchronic patients. It also examined changes over time in the size of the two groups, total number of bed days used, mean number of admissions, mean length of stay, and mean cumulative two-year length of stay. Four years after implementation of the prospective payment system, chronic patients constituted 3 percent of the patient population but used 15.2 percent of all bed days. Both chronic and nonchronic patients had a similar decrease in mean length of stay over the period, but chronic patients' mean number of admissions rose by more than 70 percent. The mean cumulative two-year length of stay of chronic patients remained stable over the period while that of the nonchronic patients decreased by 33.2 percent.

Adult↗
PubMed1990

Comparing outcomes of care before and after implementation of the DRG-based prospective payment system.

We compared patient outcomes before and after the introduction of the diagnosis related groups (DRG)-based prospective payment system (PPS) in a nationally representative sample of 14,012 Medicare patients hospitalized in 1981 through 1982 and 1985 through 1986 with one of five diseases. For the five diseases combined; length of stay dropped 24% and in-hospital mortality declined from 16.1% to 12.6% after the PPS was introduced (P less than .05). Thirty-day mortality adjusted for sickness at admission was 1.1% lower than before (16.5% pre-PPS, 15.4% post-PPS; P less than .05), and 180-day adjusted mortality was essentially unchanged at 29.6% pre-vs 29.0% post-PPS (P less than .05). For patients admitted to the hospital from home, 4% more patients were not discharged home post-PPS than pre-PPS (P less than .05), and an additional 1% of patients had prolonged nursing home stays (P less than .05). The introduction of the PPS was not associated with a worsening of outcome for hospitalized Medicare patients. However, because our post-PPS data are from 1985 and 1986, we recommend that clinical monitoring be maintained to ensure that changes in prospective payment do not negatively affect patient outcome.

Diagnosis-Related Groups↗
PubMed1989

The effect of the Medicare prospective payment system on the adoption of new technology. The case of cochlear implants.

Since the advent of Medicare's prospective payment system, beneficial but cost-increasing medical advances have been systematically assigned to existing diagnosis-related groups (DRGs) that do not cover the costs of the new technology. Recent evidence suggests that such underpayment reduces the rate at which hospitals adopt that technology. Safeguards designed to offset the negative incentives of underpayment, including the recalibration of DRG values, update factors, and the allowance of Medicare profits, appear not to have worked. We studied the case of cochlear implantation. Years after Food and Drug Administration approval and a favorable decision about Medicare coverage, payment for the device remains well below its average cost, and many hospitals ration the availability of the device to Medicare patients because of the financial losses involved. Eventually, so few patients received the implant that the original manufacturer discontinued its production. Under the DRG system, negative payment incentives compete with clinical considerations when hospitals and physicians decide whether to adopt specific cost-increasing new forms of technology of proved value. Other payment mechanisms that do not insert arbitrary financial considerations into specific treatment decisions should be considered instead.

Centers for Medicare and Medicaid Services, U.S.↗
PubMed1990

Prospective payment system and impairment at discharge. The 'quicker-and-sicker' story revisited.

Since the introduction of the prospective payment system (PPS), anecdotal evidence has accumulated that patients are leaving the hospital "quicker and sicker." We developed valid measures of discharge impairment and measured these levels in a nationally representative sample of patients with one of five conditions prior to and following the PPS implementation. Instability at discharge (important clinical problems usually first occurring prior to discharge) predicted the likelihood of postdischarge deaths. At 90 days postdischarge, 16% of patients discharged unstable were dead vs 10% of patients discharged stable. After the PPS introduction, instability increased primarily among patients discharged home. Prior to the PPS, 10% of patients discharged home were unstable; after the PPS was implemented, 15% were discharged unstable, a 43% relative change. Efforts to monitor the effect of this increase in discharge instability on health should be implemented.

Aged↗
PubMed1991

Registered nurse staffing in Pennsylvania nursing homes: comparison before and after implementation of Medicare's Prospective Payment System.

This paper examines changes in resident acuity and registered nurse staffing in all nursing homes in Pennsylvania before and after the introduction of the Medicare Prospective Payment System (PPS) in 1983. The analysis is based on 1980, 1982, 1985, and 1987 data from the Long Term Care Facilities Survey conducted by the State Health Data Center, Pennsylvania Department of Health. Although the acuity of nursing home residents has increased significantly since the introduction of PPS, full-time registered nurse staffing has remained unchanged, and part-time registered nurse staffing has declined. This alarming trend threatens the quality of care patients receive, yet remains largely unaddressed.

Aged↗
PubMed1990

Mortality following hip fracture before and after implementation of the prospective payment system.

Recent studies of patients with hip fractures from two hospitals have suggested that the marked reduction in length of stay that occurred following implementation of the Medicare prospective payment system (PPS) resulted in decreased quality of care for these patients. To assess whether this change influenced mortality, we studied patients with hip fractures aged 65 years or older from a 20% sample of Michigan Medicare enrollees. There were 2130 such patients in the 2 years preceding (October 1981 through September 1983) and 2238 in the 2 years following (October 1984 through September 1986) implementation of PPS. Although the demographic characteristics of patients with hip fractures did not change after PPS, the mean length of stay (95% confidence interval) decreased by 4.4 (4.1 to 4.7) days. However, mortality in the year following the fracture did not change: 23.2% before PPS, 23.7% after PPS; rate difference of 0.5% (-2.0 to 3.0). This finding was consistently present within subgroups defined by patient demographic characteristics. Furthermore, when the analysis was restricted to patients treated in those hospitals with the greatest reduction in average length of stay following PPS (7.5 days, or 35%), there was no significant change in 1-year mortality. For those patients who were enrolled in Medicaid and not in a nursing home at the time of the fracture, there was no increase in the rate of nursing home residence 1 year after the fracture. Thus, the findings of this population-based study suggest that the key outcomes of postfracture mortality and nursing home residence were not affected by the implementation of PPS.

Aged↗
PubMed1990

Studying the effects of the DRG-based prospective payment system on quality of care. Design, sampling, and fieldwork.

We have conducted a nationally representative before-after study of the effects of the diagnosis related groups-based prospective payment system (PPS) on quality of in-hospital care for aged Medicare patients. We used a pre-post design with multiple time points in both the pre-PPS (calendar years 1981 and 1982) and post-PPS (July 1985 through June 1986) periods. We gathered clinically detailed data from medical records of patients with one of six diseases and supplemented these data with postdischarge information from Health Care Financing Administration files. We used a stratified multistage cluster sampling design with data gathered on 16,758 patients chosen from 297 hospitals in 30 areas in five states. Our hospital participation rate was 97%; we successfully accessed 96% of the medical records we requested; and our mean item-level reliability score was 0.80. Our sample matches the nation closely on hospital urbanicity, size, teaching status, ownership, and percentages of Medicare and Medicaid patients, and patient demographics and mortality.

Cross-Sectional Studies↗
PubMed1990

The effects of the DRG-based prospective payment system on quality of care for hospitalized Medicare patients. An introduction to the series.

In 1985, we began a 4-year evaluation of the effects of the diagnosis related groups-based prospective payment system on quality of care for hospitalized Medicare patients. This article provides an overview of the study's background, aims, design, and methods. We used a clinically detailed review of the medical record supplemented by data on postdischarge outcomes drawn from the files of the Health Care Financing Administration and fiscal intermediaries to (1) compare outcomes of care after adjustment for sickness at admission, (2) assess the process of in-hospital care and relationships between processes and outcomes, and (3) assess status at discharge for a nationally representative sample of patients hospitalized before and after prospective payment was implemented.

Diagnosis-Related Groups↗
PubMed1990

An all-payor prospective payment system (PPS) based on diagnosis-related-groups (DRG): financial impact on reimbursement for trauma care and approaches to minimizing loss.

To assess the financial impact of the new all-payor prospective payment system (PPS), data for 430 patients admitted to a Level I Trauma Center were compared to all hospital discharges (n = 35,309). Trauma patients had a LOS of 13.1 days, average Trauma Score of 15, and operating loss for trauma patients totalled $1,310,625. Trauma as compared to all patients showed a greater variance in LOS (6.3 vs. 2.0 days), a higher case mix index (CMI) (1.93 vs. 1.40), and a greater loss per case (-$3,404 vs. -$979), respectively. The trauma group DRG weights correlated with revenue (r = 0.89; p less than 0.0001); however, there was no relation to profit/loss. Review of trauma patients' records revealed inaccurate coding. Corrections led to an increase in reimbursement of $132,000. Five DRGs were added in 1989 for multiple significant trauma (MST). Using the 1989 grouper, 30 patients were reassigned, with an increase in reimbursement of $250,000. Although these strategies reduce operating deficit by 29%, reimbursement for trauma care must be addressed further.

Costs and Cost Analysis↗
PubMed1991

Nosocomial pneumonia in Medicare patients. Hospital costs and reimbursement patterns under the prospective payment system.

To determine the extent to which hospitals are reimbursed for Medicare patients who develop nosocomial pneumonia, we analyzed hospital accounting costs, reimbursements received, and the net income from 33 Medicare patients who developed nosocomial pneumonia. In 31 of the 33 cases, hospital costs for the entire admission exceeded reimbursements, with a median net loss of $5800 per case. Eleven randomly selected pneumonia cases were compared with control patients matched by diagnosis related group, age, sex, and service. Cases had significantly longer hospital stays, had greater total hospital costs, and caused greater net losses than did matched controls. We conclude that hospitals are seldom reimbursed adequately for Medicare patients who develop nosocomial pneumonia. With the advent of the prospective payment system, hospitals now have substantial financial incentives for implementing cost-effective measures for preventing nosocomial pneumonias.

Aged↗
PubMed1990

Transfers of hospitalized psychiatric patients under Medicare's prospective payment system.

Medicare's reimbursement policy provides payment incentives for hospitals to transfer psychiatric patients to another acute-care facility, especially when the destination facility is exempt from Medicare's prospective payment system. The authors found, however, that transfers were relatively infrequent in 1985, accounting for only approximately 3.4% of all psychiatric hospitalizations under Medicare. The most common type of transfer was from a nonspecialized general hospital bed to a Medicare-exempt psychiatric unit within the same hospital. Given that increasing financial pressures may result in a rise in the number of transfers, the authors discuss potential reforms of Medicare reimbursement for these cases.

Centers for Medicare and Medicaid Services, U.S.↗
PubMed1992

Change in the Medicare case-mix index in the 1980s and the effect of the prospective payment system.

Persistent increases in the Medicare case-mix index over the 1980s have been ascribed to changes both in medical treatment ("real changes") and in the way medical information is recorded ("coding changes") in hospitals. These changes have been attributed, in the absence of appropriate data and analyses, to the incentives of the Medicare prospective payment system (PPS). Using data for 1980-1986 from 235 hospitals, we estimate the effect on the Medicare case-mix index of a series of variables that reflect medical treatments and coding practices. Each of these underlying real or coding variables was changing prior to PPS and would likely have continued to change even in the absence of PPS. Furthermore, PPS may have had a distinct effect on these variables. These underlying trends and the PPS effects must each be estimated. Thus, the analysis begins by developing separate estimates for each of these real and coding variables (1) in the absence of PPS (autonomous effects) and (2) as a result of PPS (induced effects). Then, changes in the case-mix index are regressed against all of these variables to determine the degree to which specific autonomous real or coding variables or induced real or coding variables actually influenced measured case mix. Results show that real and coding changes each accounted for about half of the change in the Medicare case-mix index between 1980 and 1986, with the influence of coding starting to wane by 1986. PPS-induced factors explain about 80 percent of the change in measured case mix over time, autonomous factors about 20 percent. Especially powerful determinants of case-mix change included PPS-induced substitution of surgical for medical care and PPS-induced improvements in the accuracy of coding that led to assignment of patients to higher-weighted DRGs. Also, stringent Medicare peer review organizations appeared to restrain rises in case-mix indexes for their hospitals. Outpatient substitution for inpatient treatment, which others attributed to PPS, was well underway before PPS was announced.

Abstracting and Indexing↗
PubMed1990

Hospital financial performance under the prospective payment system by type of admission: psychiatric versus medical/surgical.

We performed detailed simulations of DRG-based payments to general hospitals for treatment of nonexempt psychiatric and medical/surgical patients under Medicare's prospective payment system (PPS). We then compared these results to calculated costs for the same patients. Hospitals without specialized psychiatric units tend to fare better financially on their psychiatric than on their medical/surgical caseloads, although the levels of gain for these two types of patients are correlated. Hospitals with nonexempt psychiatric units generally have similar rates of gain on psychiatric and medical/surgical patients. Comparing psychiatric treatment in "scatter-bed" sites with that provided in nonexempt units, the higher rate of gain under PPS for treatment in scatter beds results largely from shorter lengths of stay. We discuss hospital behavior and the relationships between treatment of psychiatric illness under DRG-based payment and its treatment in exempt psychiatric units, which are excluded from DRG-based payment.

Computer Simulation↗