Question

Prospective payment system rates are based on the national “average” cost figures. Taking the national average cost into consideration, CMS sets base rates for each PPS. The PPSs then add provisions or adjustments to their system to account for situations where the cost of an individual episode of care or service may be greater or lower than the national average. Pick three provisions or adjustments from PPSs discussed in Chapter 7. Discuss why that provision or adjustment is needed. What would happen if that provision or adjustment was discontinued? How would this impact facilities or providers? How would this impact the Medicare beneficiary?

Answer 1

PPS focus on the adequacy of partner rates it made inpatient cost and its growth that determine the payment for medicare. these rates provide quality and efficient care for Medicare beneficiaries. PPS will provide home health agencies for each 60-day case payment for beneficiaries, it has features like payment for the 60day care, case-mix adjustment, outlier payments, few visit payment adjustments during 60day period, readmission payment adjustment with place thin 60days, consolidated billing for nursing and their services, medical supplies. in nursing facilities under medicare cost beneficiaries benefit for resource utilization . under PPS facilities increase the cost when independent nonprofit costs discontinued for therapies. In facilities, if some complex patients have more difficult in place for PPS they actively manage the care with increase reimbursement. many large facilities have private pay residents have more financial favorable, it absorbs external transaction costs with the contract. these provisions accept the mixed federal rate without benefit that leads to disadvantages. medicare DRGs for hospital reimbursement have major care-mix that impact facility, which leads to high transaction cost with outside suppliers. it limits the services for medicare beneficiaries.