13523. MEDICARE REIMBURSEMENT: FFS VERSUS HMOs. This paper reviews historical and current Medicare reimbursement systems in its fee-for-service and HMO plans. Describes historical approaches to reimbursement, discusses the implementation of the Prospective Payment System (PPS) and the impact of Diagnostic-Related-Groups (DRGs) as well as the RBRVS for reimbursing physicians. Analyzes Medicare's capitated method for HMO reimbursement and identifies weaknesses. A concluding section discusses the Balanced Budget Act of 1997 (BBA) and its impact on Medicare reimbursement. 12 pages, 53 footnotes, 21 bibliographic sources.