Final answer:
The Prospective Payment System changed Medicare and Medicaid home care reimbursement from a cost-based system to a system of fixed-fee reimbursement based on a patient-need classification system.
Step-by-step explanation:
The correct answer is a. Prospective payment system.
The Prospective Payment System (PPS) changed Medicare and Medicaid home care reimbursement from a cost-based system to a system of fixed-fee reimbursement based on a patient-need classification system. Under the PPS, healthcare providers are paid a predetermined amount for each medical service provided, regardless of the actual cost of the service.
For example, if a patient requires home health care services, the reimbursement would be based on a predetermined fixed fee that is determined by the patient's needs and condition, rather than the actual cost incurred by the provider. This system helps to control costs and ensures that providers are reimbursed fairly based on the care needed by each patient.