Hospitals Brace for Next HAC Penalty

Cheryl Clark, for HealthLeaders Media , May 8, 2014

Weil adds that "Since the HAC Reduction Program is required by law, CMS should include the safety measures there, and remove them from the Value-Based Purchasing program to minimize overlap."

The HAC penalty also punishes hospitals for many of the same types of harm as the 2008 Hospital-Acquired Condition payment provision. That's the provision under the Deficit Reduction Act of 2005 that empowers CMS to stop paying for extra care that resulted from 10 types of harm, now increased to 11, such as pressure ulcers, falls and trauma, poor glycemic control or urinary tract infections.

Back then, these adverse incidents were called "never events," and the thought was that hospitals would rush to avoid them to escape incurring extra costs for delayed stays and additional surgeries, especially if it meant fewer patients spending time in expensive intensive care units.

Small Dollars
As it's worked out, however, the 2008 HAC payment provision has not hurt hospitals financially. In fact, CMS has avoided paying hospitals for extra care from these adverse events a total of only about $25 million a year since the rule took effect.

And according to the latest proposed rule, CMS says that it anticipates saving only between $28 million and $38 million a year from FY 2015 through FY 2019. That's really just pennies.

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