Prospective pricing system and its effect on the principles and practice of infectious diseases.

The health care industry in general and hospitals in particular face an uncertain future as the federal government moved with unusual speed to enact sweeping Medicare legislation. These changing patterns of reimbursement reverse key economic incentives by which hospitals have been driven since the federal program for the elderly began 18 years ago. "Reasonable" cost reimbursement has been replaced by a policy that requires Medicare to establish and fix prices in advance, on a cost-per-case basis, using as a measure 467 categories called "diagnosis-related groups." These changes will present new challenges for the health care industry and will need innovative approaches to meet them. The prospective pricing system attempts to reverse the escalation of health care costs. Under this system, hospitals can realize greater profits only by reducing costs, not by incurring them. The prospective payment system will have profound effects on the practice of infectious diseases, and the potential impact on hospitals, the pharmaceutical industry, physicians, and patients will have to be studied in detail.