Assessing the FY 1989 change in Medicare PPS outlier policy

  title={Assessing the FY 1989 change in Medicare PPS outlier policy},
  author={Grace M. Carter and Donna O. Farley},
  booktitle={Health care financing review},
In fiscal year (FY) 1989, Medicare changed its rules for paying for extremely long or expensive hospital stays called "outliers." We compared outlier payments in FYs 1989 and 1988, after adjusting for other simultaneous policy changes. We found that the new policy succeeded in targeting more outlier payments to the most expensive cases and to the hospitals suffering larger prospective payment system (PPS) losses and in reducing hospital financial risk. Using time-series analyses, we show that… CONTINUE READING