When hospitals botch the quality of patient care, their bottom lines often take a hit as their reputations nosedive, regulatory oversight increases, fines are imposed and lawsuits are filed. Now, making a mistake is getting even costlier as health care insurers and the federal government are penalizing hospitals by axing reimbursements for faulty patient care.
In Connecticut, hospitals are required to report preventable medical errors — termed “adverse events” — to the Department of Public Health and face subsequent investigations and potential fines and mandated procedural changes.
From July 2004 to September 2007, 11 percent of adverse events resulted in death. That means 73 people died because of supposedly “preventable” mistakes.
The Centers for Medicare and Medicaid Services got the adverse event movement going among insurers: beginning in October, it will no longer pay to treat nine preventable conditions acquired in a hospital, including falls, certain infections and surgery performed on the wrong patient. According to CMS, hospitals must now absorb the cost of treating the condition and may not bill the patient.
The point, CMS said, is that implementing such a provision will give hospitals a financial incentive to take steps to prevent conditions that should never occur in a hospital.
Plus, CMS estimates that the move will save Medicare $20 million in FY 2009.
Companies Follow Suit
Wellpoint followed the CMS lead, recently announcing it would no longer offer reimbursements for 11 medical errors.
And Cigna is launching a new policy that mimics that of Medicare; it launches the same time and deems the same preventable procedures uncovered, said Cigna spokesperson Mark Slitt.
“Medicare came along and saw that this was potentially a very large issue in fostering patient care and fostering quality,” Slitt said. “We want to be encouraging hospitals to be giving appropriate care.”
Slitt said Cigna isn’t looking at the new policy as a cost-saving measure, and it expects the savings to be small.
“This is really all about patient safety and delivering quality health care and providing consumers with tools to make informed health care choices,” Slitt said.
Aetna Gets Aggressive
Aetna has taken perhaps the most aggressive approach, recently announcing that its list of non-reimbursable events is 28 items long.
And that’s where hospitals draw the line, said Dr. Brian Fillipo, vice president of quality and patient care for the Connecticut Hospital Association.
The 28-events-long list comes from the National Quality Forum, which is a nonprofit national coalition of physicians, hospitals, businesses and policy-makers. It was developed to aggregate events and look for potential quality improvement, said Fillipo — not as a list of what’s worthy of reimbursement and what is not.
Meeting in the Middle
“I think things have evolved in a way that was not intended,” Fillipo said. “At the end of the day, we all want the same thing,” he added. “It’s just doing it in a way that makes sense and is fair.”
Although all the events on the list are serious, he said, they are not always preventable by the hospital.
For example, pressure ulcers are simply not preventable in some patients, regardless of the quality of care they are given.
“I don’t think it’s realistic for a hospital not to expect reimbursement in that case,” Fillipo said.
Although Fillipo has not had any direct dealings with insurance policy reform, he said there are people working to revise policies to better suit the task at hand.
It’s not something that needs to be legislated through statute, Fillipo said. It’s just a matter of hospitals and health plans working together.
