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HEHS-95-158R 1 (1995-05-25)

handle is hein.gao/gaobackvm0001 and id is 1 raw text is: G O United States JQ -A9jrpZ General Accounting Office Washington, D.C. 20548 Health, Education and Human Services Division B-234279 May 25, 1995 The Honorable John R. Kasich Chairman, Committee on the Budget House of Representatives Dear Mr. Chairman: As you know, the Medicare program covers hospital inpatient as well as outpatient services for eligible beneficiaries. Hospital inpatient services constitute the single largest category of Medicare spending. In fiscal year 1984, the prospective payment system (PPS), a system of standardized payments per discharge based on patient diagnosis, was put in place to control the growth of this spending category; however, payments per discharge have continued to grow faster than the general inflation rate. While payments to all types of hospitals have increased faster than inflation, they have not increased at the same rate. To examine the trends in payment growth, you asked us to provide you with the annual growth rates in payments per discharge by type of hospital. To provide this information, we examined data from the Prospective Payment Assessment Commission (ProPAC). In summary, these data show that -- hospital payments per discharge grew at an annual rate of 5.4 percent from 1984 through 1992, while general prices grew about 3.5 percent annually over the same period;' -- by teaching status, major teaching hospitals experienced the largest growth in payments per discharge, averaging 5.7 percent annually from 1984 through 1992; nonteaching hospitals' payment growth averaged 5.3 percent annually; :We measured the growth in general price levels using the gross domestic product implicit price deflator, adjusted for the fiscal year. GAO/HEHS-95-158R Medicare Hospital Payments

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