Outpatient PPS will create hospitals' greatest challenge. Part I.

Medicare's Outpatient Perspective Payment System is scheduled for implementation on July 1, 2000, and most providers will experience a reduction in revenue as a result. Ted Matson and Jim Georgoulakis of Ambulatory Care Advisory Group, Inc. provide an overview of this new reimbursement system and what it will mean for hospitals.

Casemix: the allied health response.

Casemix has given allied health professionals the opportunity to review their approaches to patient care, contribute to reducing inpatient costs and improve quality of care. The National Allied Health Casemix Committee was formed in 1993 to advance allied health participation in casemix. The Committee has taken the first step in establishing cost weights for allied health through the Australian Allied Health Activity Classification, which defines allied health inputs in terms of clinical care, clinical service management, teaching and training, and research. Work is being done on generic classification of allied health inputs, and studies are examining what allied health activities are accounted for by DRGs and ICD-9-CM. Allied health has taken up the challenge of casemix, but better access to information technology will enhance its continued contribution.

Design of a prospective payment patient classification system for ambulatory care.

The Ambulatory Patient Group (APGs) are a patient classification system that was developed to be used as the basis of a prospective payment system (PPS) for the facility costs of outpatient care. This article will review the key characteristics of a patient classification system for ambulatory care, describe the APG development process, and describe a payment model based on the APGs. We present the results of simulating the use of APGs in a prospective payment system, and conclude with a discussion of the implementation issues associated with an outpatient PPS.