Medicare’s Policy Not To Pay For Treating Hospital-Acquired Conditions: The Impact

Abstract

In 2008 Medicare stopped reimbursing hospitals for treating eight avoidable hospital-acquired conditions. Using 2006 California data, we modeled the financial impact of this policy on six such conditions. Hospital-acquired conditions were present in 0.11 percent of acute inpatient Medicare discharges; only 3 percent of these were affected by the policy. Payment reductions were negligible (0.001 percent, or $0.1 million-equivalent to $1.1 million nationwide) and are unlikely to encourage providers to improve quality. Options to strengthen the incentives include further payment modifications for hospital-acquired conditions or expanding the hospital-acquired condition policy to exclude payment for consequences, additional procedures, and readmissions.

Are There Modifiable Risk Factors for Hospital Readmission After Total Hip Arthroplasty in a US Healthcare System?

“…Within orthopaedics, the Centers for Medicare & Medicaid Services has focused on 30-day readmissions after elective total joint arthroplasty (TJA) as a quality indicator and has initiated a ''no pay'' policy for readmissions after these procedures [18,29]. Although THA is an effective, high-volume procedure [11,12,15], 4% to 10.9% of patients are readmitted to the hospital after the procedure [5,7,30,[32][33][34].…”

Enhancing Medicare’s Hospital-Acquired Conditions Policy to Encompass Readmissions

“…Although 38 times larger than estimates of the projected impact of the current HAC program ($2.7 million; McNair et al, 2009), it is still a small fraction of the total Medicare budget.…”

“…A study of within admission HAC incidence by McNair et al, (2009) shows little difference between California and data representative of the remainder of the US. The nationwide financial impact is extrapolated assuming that the incidence of readmission for HAC in California reflects the incidence for the remainder of the United States.…”

“…This can be contrasted with a $2.7 million reduction in hospital payments for Medicare patients using the same method and data, but applying the HAC policy only to cases in which a HAC is identified during the same admission (McNair et al, 2009). …”

“…For example, payment for an admission that included the administration of an incompatible blood transfusion to a patient would not be allowed to include consideration of the HAC code (ICD-9 diagnosis code '999.6-ABO incompatibility reaction due to transfusion of blood or blood products') although other diagnosis and procedure codes, including sequelae of the incompatible transfusion, could be considered. As McNair et al (2009) demonstrated, for many admissions with a HAC, the payment level is not altered by eliminating the code specifically associated with the HAC.…”