Health Care Admission Essay Sample on Payment Systems

Payment Systems

Comparison and Contrast between Prospective and Non-Prospective Payment Systems

          Prospective systems are reimbursement methods in which Medicare payments are impacted based on predetermined fixed amounts. Amounts paid for services are derived from specific service system classification for example, ambulatory payments for outpatient claims and diagnosis related classification for inpatients. On the other hand, Non- prospective systems reimburses healthcare for particular service provided instead of fixed fee for entire service. For example, in cancer and pediatric hospitals apply non-prospective reimbursement systems (Abbey, 2012, p.201).

Classification Systems used with Prospective Payments

  1. Case- Mix Groups: CMGs consist rehabilitation categories, patient age and cognitions scores. These systems determine patient payment rates in accordance with their therapy stay.
  2. Resource utilization System: This system is based on nursing facility, where beneficiaries are reimbursed according to assessment on data set as well as score estimates on rehabilitation teams. (Goldfield & Kelly 2007, p.155).
  3. Home Health Systems:  Established assessment and outcome information determines health resource groups. Healthcare payment is impacted according to patient resource groups, and it is adjusted basing on changes in patient’s condition.
  4. Diagnosis- Related Groups: This system is determined by primary patient diagnosis, and is adjusted according to patient sex and age, diagnosis and procedures performed (Goldfield & Kelly 2007, p. 154).

How Prospective Payment Systems Impact Operations

             Prospective payments result to shorter patient stay in hospitals, reduced unnecessary tests, decreased operational costs and hospital capacity, improved healthcare management as well as data system administration. Additionally, these systems impact to increased proficiency and efficiency in services, encouragement of physician and care providers and provision of wide range of regional physician consultations through advanced technological settings (Abbey, 2012, p.201).


Abbey, D.C. (2012). Prospective Payment System. New York, NY: CRC Press.

Goldfield, N., & Kelly, W. P. (2007). Prospective payment for ambulatory services. Gaithersburg, Md: Aspen Publishing.