Changes in Follow-Up Care for Medicare Surgical Patients Under the Prospective Payment System

by Gerald Kominski, Andrea K. Biddle-Zehnder

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This study examined changes in the number and site of source of follow-up visits provided to Medicare surgical patients between 1984 and 1986. Among the 21 surgical procedures studied, follow-up visits declined by 5.2 percent, after adjusting for case mix. Despite the physician fee freeze during most of the study period, total allowed charges increased by 8.1 percent, indicating that the average intensity of visits increased by 14.0 percent. Inpatient visits declined by 6.7 percent, while outpatient visits increased by 3.9 percent. Thus, while some substitution of outpatient for inpatient visits occurred, PPS-related reductions in inpatient length of stay were associated with reductions in both the total visits and total allowed charges. Holding other factors constant, the 9.5-percent overall reduction in length of stay produced a 6.4-percent reduction in total allowed charges. We conclude that PPS had a significant effect in reducing the growth of Medicare expenditures for physician visits. The reduction in submitted claims for inpatient follow-up visits and the absence of a strong substitution effect suggest that some inpatient visits may not have been necessary.

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