A rule proposed by Centers for Medicare and Medicaid Services (CMS) would expand its list of hospital-acquired conditions for which there would be no Medicare or Medicaid payment to include preventable "never events". Some in the industry are now preparing to follow suit.
The first claim has not yet been adjudicated. The first legal challenges by either patients or hospitals have not been launched. The first arguments by ethicists are still being formulated. The first story on "60 Minutes" or "Dateline" is yet to come. But a rule proposed by the Centers for Medicare and Medicaid Services (CMS) has already brought change to our industry.
The proposal:
"Effective October 1, 2008, there will be no reimbursement to hospitals for errors in medical care that are clearly identifiable, preventable and serious in their consequences for patients, and that indicate a real problem in the safety and credibility of a health care facility."
CMS’s proposal is part of a nationwide effort by organizations including the National Quality Forum (NQF) to improve patient safety. The rule would update CMS’s payment policies under the hospital inpatient prospective payment systems and expand its list of hospital-acquired conditions for which there would be no Medicare or Medicaid payment.
The additions include several of the 28 events identified by the NQF as Serious Reportable Adverse Events – also called "never events" because they are reasonably preventable.
These "never events", listed below, constitute conditions defined by CMS where claims payments are qualified for adjustments:
- Serious Preventable Event - object left in surgery.
- Serious Preventable Event - air embolism.
- Serious Preventable Event - blood incompatibility.
- Catheter-associated urinary tract infections.
- Pressure ulcers (decubitus ulcers).
- Vascular catheter-associated infection.
- Surgical site infection - mediastinitis after coronary artery bypass graft surgery.
- Hospital-acquired injuries - fractures, dislocations, intracranial injury, crushing injury, burns, and other causes.
Others following suit
The first insurance companies to adopt non-payment policies for "never events" similar to CMS’s proposed rule - including Aetna and WellPoint - have made their positions known. Aetna and WellPoint’s policies would be achieved, at least in part, through hospital PPO contracts that would preclude hospitals from billing for "never events", thus protecting patients from balance billing.
Some schools of thought suggest that it may be difficult to enforce the CMS rule once effective, or that it won’t hold up in court if challenged. However, CMS has the influence and the power to affect these changes. Hospitals, on the other hand, will be bound to comply with new PPO contract obligations with carriers adopting "never events" non-payment provisions.
Improving patient safety should be the driving force behind this movement, rather than simply saving money for insurers at the expense of insureds. As long as this is the case, the approach taken by the lead carriers - amending PPO contracts to require participating hospitals to waive charges for "never events" – may be appropriate.
Start a dialog
Symetra is not making a policy decision at this time, but we want to open dialogue with all our partners on this issue.
All in our industry need to explore the effect the "never event" policy will have on the industry and those we serve, and we encourage you to begin discussing the issue with your clients and PPO partners.
As you continue to explore and address the challenges associated with the proposed "never event" policy, we look forward to your feedback. Please click here to send us your comments or questions.
As always, Symetra takes an owner’s interest in that which affects our partners and our industry. And like the rest of the industry, we will be actively engaged in reviewing how this important issue continues to develop.
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