Please check my answer thanks :)

Hospitals that are excluded from the Medicare PPS (such as children's hospitals) are paid based on

1 reasonable cots
2. fee schedules
3. global payments
4. bundled payments

I picked # 1

To verify if your answer is correct, let's go through the options:

1. Reasonable costs: This refers to reimbursing hospitals based on the actual cost of providing services. It is a common payment method for hospitals that are exempt from the Medicare PPS (Prospective Payment System), such as children's hospitals.

2. Fee schedules: This involves predetermined payment rates for specific services. Fee schedules are typically used in the Medicare PPS for hospitals that are not excluded.

3. Global payments: Global payments or global budgets are fixed amounts of money given to hospitals to cover all the costs associated with patient care over a defined period. This method is not typically used for hospitals excluded from the Medicare PPS.

4. Bundled payments: Bundled payments involve a single payment that includes multiple services provided for a particular condition or episode of care. This method is not commonly used for hospitals excluded from the Medicare PPS.

Based on the options provided, your answer of "reasonable costs" aligns with hospitals excluded from the Medicare PPS. Therefore, it seems that your answer is correct. Well done!