Medicare Reduces Payments to 800 Hospitals Citing Patient Safety Incidences

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Medicare announced on March 1, 2019, that 800 hospitals will be paid less by Medicare this year because of high rates of infections and patient injuries.

The number is the highest since the federal government five years ago launched the Hospital Acquired Conditions (HAC) Reduction Program, created by the Affordable Care Act. This year, 110 hospitals are being punished for the fifth straight time.

The penalties pit hospitals against one another in a race to prevent the most infections, blood clots, cases of sepsis, bedsores, hip fractures and other complications. Each year, the quarter of general hospitals with the highest rates are punished, even if their records have improved from the previous year.

Under the announced sanctions, each hospital will lose 1 percent of its Medicare payments for patients discharged between last October and this September. That comes on top of other penalties created by the health-care law, such as annual payment reductions for hospitals with too many patients being readmitted.

The hospital industry has protested the HAC penalties, saying the program’s design creates an arbitrary cutoff for which institutions get punished and which don’t. The American Hospital Association calculated that only about 41 percent of the 768 hospitals penalized in 2017 had HAC scores that were statistically significantly higher than hospitals not being penalized.

Hospitals also complain that the ones that do the best job testing for infections and other threats to patients appear to be among the worst based on statistics, while their more lackadaisical peers look better than they might be.

The frequency of complications has been dropping in hospitals. The report found an overall 8 percent decrease from 2014 to 2016. However, the report also found a jump in

the numbers of bedsores and urinary tract infections in patients with catheters during that time.

The Hospital Acquired Conditions Reduction Program assesses penalties based on a subsection of the injuries examined in the AHRQ report. For each hospital, Medicare judges infection rates related to colon surgeries, hysterectomies, urinary tract catheters and central lines inserted into veins. Medicare also counts the number of infections of methicillin-resistant Staphylococcus aureus, or MRSA, and Clostridium difficile, known as C. diff.

Finally, the government tracks the rate of blood clots, sepsis, post-surgical wounds, bedsores, hip fractures and five other types of in-hospital injuries. Because the penalties will be applied as hospitals submit claims for reimbursement, the total dollar amount of penalties for each hospital will not be known until the federal fiscal year ends in September.