Moreover, Medicare will reimburse skilled nursing facilities on a prospective, rather than retrospective reasonable cost basis, for post-hospital extended care services. Prospective payment will also be implemented for inpatient rehabilitation hospital services. The Secretary of the Department of Health and Human Services has been directed to promulgate implementing regulations. A PPS hospital discharging a patient to a post acute facility receives a full payment for the patient based on DRG classification. In addition, the receiving facility or agency is paid a separate amount based on the reasonable costs of follow-up care, subject to established limits and exceptions.
Payment is graduated by paying the first day at twice the per diem amount.
They contend that there is a reimbursement windfall when patients are discharged prior to the ALOS, and then when follow-up care is paid on the basis of reasonable costs. Proponents of the current system consider the dual reimbursement system equitable for high acuity patients requiring intensive therapies, which costs are not adequately covered under the PPS averaging system. The Secretary appears to have the ability to reduce payment even further as part of the rule making process. The 1998 Budget also includes a prospective payment system for post-hospital extended care services. Costs of Part A Medicare post-hospital extended care services and certain Part B Medicare services paid during a cost reporting period will be paid on the basis of an adjusted Federal per diem rate.