Abstract In a longitudinal panel study design, 80 hospitals in Virginia were selected for analysis to test the hypothesis that the introduction of the prospective payment system (PPS) in October 1983 had helped hospitals enhance their operational performance in technical efficiency. in later sections we examine the changes in such use in relation to hospital readmission and mortality outcome. However, this definition was applied uniformly for both pre- and post-PPS periods, and we are not aware of any systematic differences in the onset of post-acute services between the two time periods. A multivariate clustering methodology was employed to identify relatively homogeneous subgroups of disabled Medicare beneficiaries so that utilization changes could be compared for medically and functionally similar cases as well as for the total disabled population. A Prospective Payment System (PPS) is a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. To assist our community with this payment, the pensioner rebate applied against the water infrastructure charge has been doubled from $35 per annum to $70 to help pensioners with the cost of the water charges. While differences in mortality were not statistically significant, they suggest an increase in hospital and SNF mortality and corresponding mortality decreases in HHA other settings. These payment rates may be adjusted periodically to account for inflation, cost of living in certain regions or other large scale economic factors - but not to accommodate individual patients. The characteristics of the four subgroups suggested different needs for Medicare services and different risks of various outcomes such as hospital readmission and mortality. This allows both parties to budget accordingly, reducing waste and improving operational efficiency. U.S. Department of Health and Human Services The LOS of hospital stays declined between the pre- and post-PPS periods, for all discharge terminations except to "other."
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