Describe how some of the changes in the health services delivery system have led to a decline in hospital inpatient days and a growth in ambulatory services.
Answer: Medicare reimbursement and cost-saving efforts of managed care are the two main factors that have led to a decline in hospital inpatient days and a growth in ambulatory services. Medicare instituted the prospective payment system (PPS) for reimbursing hospitals in the mid-1980s. PPS reimbursement based on DRGs provides fixed case-based payment to hospitals. Hospitals, therefore, have a strong incentive to minimize the inpatient length of stay and continue treatment in an outpatient setting. The outpatient sector has fewer payment restrictions.
Cost-containment strategies adopted by managed care also stress lower inpatient utilization, with a corresponding emphasis on outpatient services. These financial factors, for instance, have provided a major impetus for the unprecedented growth of home health care. Such changes, coupled with the availability of new technology, have also shifted a number of inpatient surgical procedures to the outpatient setting.