Question: The Medicare prospective payment system (PPS) was introduced by the federal government in October, 1983, as a way to change hospital behavior through financial incentives

The Medicare prospective payment system (PPS) was introduced by the federal government in October, 1983, as a way to change hospital behavior through financial incentives that encourage more cost-efficient management of medical care.

Discuss two major reasons that Medicare administrators turned to the prospective payment concept for Medicare beneficiaries.

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