Vulnerability of rural hospitals to Medicare outpatient payment reform

• Published in: Health care financing review Vol. 21; no. 1; pp. 1 - 18
• Main Authors: Mohr, P E, Franco, S J, Blanchfield, B B, Cheng, C M, Evans, W N
• Format: Journal Article
• Language: English
• Published: United States Superintendent of Documents 1999; CENTERS for MEDICARE & MEDICAID SERVICES
• Subjects: Aged; Budgets; Claims adjustment (Insurance); Costs; Data Collection; Economic aspects; Fees, charges, etc; Finance; Financial Management, Hospital - trends; Health administration; Health policy; Health Services Research; Hospital Bed Capacity, under 100; Hospital Costs - statistics & numerical data; Hospitals; Hospitals, Rural; Hospitals, Rural - economics; Hospitals, Rural - organization & administration; Hospitals, Rural - statistics & numerical data; Hospitals, Urban - economics; Hospitals, Urban - organization & administration; Hospitals, Urban - statistics & numerical data; Humans; Impact analysis; Income - statistics & numerical data; Income - trends; Medical sector; Medical service, Rural; Medicare; Medicare - legislation & jurisprudence; Multivariate Analysis; Outpatient care facilities; Outpatient Clinics, Hospital - economics; Outpatient Clinics, Hospital - organization & administration; Ownership; Primary care; Profit margins; Profitability; Prospective Payment System - legislation & jurisprudence; Prospective payment systems; Reforms; Reimbursement; Rural areas; Rural health care; Studies; Trends; United States; Urban health care; United States; United States > US
• ISSN: 0195-8631; 1554-9887

Because the Balanced Budget Act (BBA) of 1997 requires implementation of a Medicare prospective payment system (PPS) for hospital outpatient services, the authors evaluated the potential impact of outpatient PPS on rural hospitals. Areas examined include: (1) How dependent are rural hospitals on outpatient revenue? (2) Are they more likely than urban hospitals to be vulnerable to payment reform? (3) What types of rural hospitals will be most vulnerable to reform? Using Medicare cost report data, the authors found that small size and government ownership are more common among rural than urban hospitals and are the most important determinants of vulnerability to payment reform.