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What is the prospective payment system (PPS) for Medicare?

April 26, 2017medicare payment PPS system

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What is the prospective payment system (PPS) for Medicare?

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Hospitals that treat Medicare patients do so on a prospective payment system (PPS). Under this system, Medicare sets a limit on the price it will pay for a patient s stay in the hospital and the hospital agrees to accept that amount, even if the treatment it provides costs more.