What is the purpose of the IPPS 3-day payment window?

The purpose of the IPPS (Inpatient Prospective Payment System) 3-day payment window is to ensure that certain outpatient services provided to a patient within three days prior to an inpatient admission are considered part of the inpatient stay and thus included in the payment to the hospital. This means that if a patient receives outpatient services that are directly related to their upcoming inpatient hospital stay, those services are bundled into the payment for the inpatient admission rather than being billed separately.

This methodology helps to streamline billing processes and encourages hospitals to coordinate care, as they will be reimbursed for these related services in a more holistic manner. By doing so, it helps to prevent hospitals from potentially serving as "outpatient providers" inappropriately, which could lead to fragmentation of care and higher overall costs for the healthcare system.

Options related to separate billing for outpatient services, reducing readmission rates, or classifying patients based on length of stay do not accurately capture the intent or mechanism of the 3-day payment window, as their primary purpose is focused on the bundling of services leading up to an inpatient admission.