Monitoring Medicare Hospital Outpatient Payments: Trends and Evidence of Impacts of Payment Policy
Under the new outpatient prospective payment system (OPPS), outpatient departments that face relatively high costs of producing certain services receive payments that may be less than the individual facility's costs. By contrast, a number of small rural hospitals are currently exempt from OPPS and are paid on a cost-basis, such as critical access hospitals (CAHs). In contrast to OPPS facilities, CAHs are expected to receive payments that more closely approximate costs on average. This project documents recent trends in the provision of Medicare hospital outpatient services under both the new outpatient prospective payment system and cost-based mechanism used for CAHs, and assesses evidence on the impacts of Medicare OPPS on Medicare and total outpatient revenue. Data sources include Medicare Cost Reports, the American Hospital Association's 2000 and 2002 surveys, the Area Resources File, and qualitative information obtained from selected hospitals. A Policy Brief will summarize findings.
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