Institute:Office of National Coordinator (ONC) Workforce Training Curriculum
Component:Introduction to Health Care and Public Health in the U.S.
Unit:Financing Health Care - Part 1
Lecture:The Government as an Insurance Payor
Slide content:Prospective Payment System (PPS) System for reimbursing providers Controls costs Pays predetermined, fixed dollar rate regardless of services provided The rate depends on the patients diagnosis-related group (DRG) Age Gender Principal diagnosis Other conditions Surgical procedures 9
Slide notes:Medicare uses a prospective payment system to reimburse providers of Part A services. The goal is to make providers more cost-effective by paying them a pre-determined, fixed rate per patient no matter what services are actually performed. The rate is determined by the patients diagnosis-related group, or DRG . The DRG is assigned based on factors such as patient age, gender, principal diagnosis, other conditions, and surgical procedures performed. 9