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Implementing Case‐Mix Systems

The environment within which health care institutions operate has changed dramatically in the last 20 years. In the 60s it was characterized by a not-for-profit orientation, retrospective cost or charge-based reimbursement, services franchised through the CON process, and limited availability of alternative delivery systems and health insurance plans. The environment of the 80s is characterized by a move toward prospective reimbursement, a case-mix orientation, competition from forprofit chains, increased availability of alternate delivery systems and health insurance plans, and heightened price sensitivity in the purchase of hospital services by government, business, and patients. These factors demand that