Outpatient Institutional Rehabilitation Services 1987-1990

Who Provides Them and How Do They Compare?

by Joan L. Buchanan, J. David Rumpel, Helen Hoenig

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The overall growth of Medicare Part B charges for rehabilitation services is high and if unabated, will exacerbate Medicare's cost containment problem. Regression models show that the pattern of therapy used, the use of multiple providers, and patient characteristics and diagnostic categories all have an impact on charges. However, even controlling for all other factors, independent rehabilitation agencies consistently had the highest charges across all models, and hospital outpatient departments the lowest. Thus, if rehabilitation services are included in Medicare's projected new payment reform, Ambulatory Payment Groups, and if the reform covers only hospital outpatient departments, it would encourage a shift to more expensive providers.

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