Despite the simplistic media spin this isn’t a simple matter of whether Medicare will “pay for mistakes”. It’s not as if Medicare even pays for the all the appropriate hospital care patients actually get. Medicare hasn’t done that since the advent of DRGs in 1983. That’s not a joke or an abstraction; it’s true in the real world, as evidenced by the fact that hospitals lose money on Medicare inpatients.
For a glimpse of what’s really going on check out the primary sources. Here’s the full text of the regs from the Centers for Medicare and Medicaid Services (CMS). (Warning: large pdf with over 2000 pages containing difficult to decipher alphabet soup and jargon along with innumerable rules inventing an untold number of crimes. Those who want “Medicare for all” take note).
Since Medicare doesn’t even pay for all necessary and appropriate hospital care what is meant by “not paying for mistakes”? As the CMS press release explains, the new rules actually constitute a complete revamp of DRGs including, among many other changes, a list of newly designated hospital complications which can no longer be coded to enhance the DRG payment. Thus hospitals can no longer recoup losses sustained as a result of certain complications which occur during hospitalization.
CMS promotes the new measure as a quality incentive and a means to more “accurate” reimbursement. It’s been widely applauded in the popular media. It is simplistically argued that Medicare should stop rewarding hospitals for preventable complications. That argument doesn’t stand up to close examination. The new policy is unfair on more than one level. First of all, DRG payments under Medicare’s Inpatient Prospective Payment System (IPPS) have never rewarded hospitals for appropriate or even perfect care, let alone for mistakes. The IPPS is an under funded mandate for hospital care of the sickest and most complex patients. Like a hidden provider tax it has penalized rather than rewarded hospitals for years. With its new policy CMS is merely stiffening the penalty.
Implicit in the policy of penalizing hospitals for adverse events is the idea of blame. CMS attempts to justify its position by citing prevention guidelines for each of the conditions listed. The newspaper spin is that potentially preventable adverse events such as falls and decubitus ulcers are medical mistakes which hospitals have been “blasé” about preventing. To anyone with experience in the care of hospitalized patients that’s patently absurd. Orac did a masterful job of exposing the absurdity in a recent post:
I know what some of you are thinking, particularly those less inclined to like doctors. You're probably thinking: Greedy doctors! No wonder they oppose something like this. There's just one problem. Most of the items on the list, although potentially preventable, are not 100% preventable even under ideal conditions. Take pressure ulcers (bedsores), for example. There are certainly nursing care interventions that can greatly decrease the risk of pressure ulcers, but no intervention will reduce that risk to zero. I've seen patients where everything was done right, the patients were turned frequently and placed on the latest beds designed to minimize pressure, who still got ulcers. Remember, Christopher Reeve, who presumably got the best skin care available after he became quadriplegic, died from sepsis due to an infected pressure ulcer.
By CMS and popular media standards, apparently, Reeve’s death was the result of a medical mistake. Pressure ulcers will never be eliminated until someone figures out a way to levitate patients. That would be the ultimate in woo. It’s beyond the pale even for the alties. (Well, most of them, anyway).
The reality is that Medicare’s IPPS forces hospitals to play a game in order to survive. It’s a game with many dimensions in the areas of coding, documentation, case management and cross subsidization. Hospitals that can’t play the game close. When other hospitals get good at the game over time Medicare changes the rules. From where I sit the impending rule change is just the latest of many vagaries of the Medicare game over the years.