What Is Medicare PPS? 
A Prospective Payment System -LRB- PPS -RRB- is a method of reimbursement to Medicare providers that is intended to motivate them to provide patient care efficiently and effectively without spending on unnecessary services . Providers are paid a predetermined , fixed amount for a certain length of hospital stay based on a unique assessment classification of each patient . It applied only to Part A inpatients -LRB- except for HMOs and home health agencies -RRB- . 