Medicare Prospective Payment and the Shaping of U.S. Health Care

About this book

This is the definitive work on Medicares prospective payment system (PPS) which had its origins in the 1972 Social Security Amendments was first applied to hospitals in 1983 and came to fruition with the Balanced Budget Act of 1997. Here Rick Mayes and Robert A. Berenson M.D. explain how Medicares innovative payment system triggered shifts in power away from the providers (hospitals and doctors) to the payers (government insurers and employers) and how providers have responded to encroachments on their professional and financial autonomy. They conclude with a discussion of the problems with the Medicare Modernization Act of 2003 and offer prescriptions for how policy makers can use Medicare payment policy to drive improvements in the U.S. health care system. Mayes and Berenson draw from interviews with more than sixty-five major policy makersincluding former Treasury secretary Robert Rubin U.S. Representatives Pete Stark and Henry Waxman former White House chief of staff Leon Panetta and former administrators of the Health Care Financing Administration Gail Wilensky Bruce Vladeck Nancy-Ann DeParle and Tom Scullyto explore how this payment system worked and its significant effects on the U.S. medical landscape in the past twenty years. They argue that although managed care was an important agent of change in the 1990s the private sector has not been the major health care innovator in the United States; rather Medicares transition to PPS both initiated and repeatedly intensified the economic restructuring of the U.S. health care system.