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December 11, 1967


JAMA. 1967;202(11):65-67. doi:10.1001/jama.1967.03130240025004

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The Social Security Administration has developed a new method of paying for hospital services under medicare. Hospitals will receive an agreed-upon uniform medicare payment each week. Its aim is to:

  • Help hospitals improve their financial planning and day-to-day management.

  • Reduce detailed paperwork.

Detailed statements of services and charges no longer will be required in advance of medicare payment, SSA said. Instead, a hospital's weekly payment will be based on an estimate of the cost of the services it expects to furnish to medicare beneficiaries in the course of a year. It will receive that amount in 52 weekly installments.

Adjustments in the amount of the payment can be made at any time to reflect current cost experience. Final settlement and audit will take place once a year.

The new medicare payment plan was suggested by Thomas M. Tierny, the Social Security Administration's new medicare director, who until last