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July 22, 2019

CMS' penalties didn't lower hospital-acquired conditions, study suggests

Daily Briefing

    Penalties levied under CMS' Hospital-Acquired Condition (HAC) Reduction Program did not lead to lower rates of HACs at penalized hospitals when compared with non-penalized hospitals, according to a study recently published in The BMJ.

    Map: The record 800 hospitals facing HAC penalties in 2019


    The HAC program, which launched in October 2014, evaluates hospitals based on their rates of several avoidable complications, including bed sores, blood clots, central line infections, falls, and infection from methicillin-resistant Staphylococcus aureus (MRSA) or Clostridium difficile (C. diff).

    Every year, the facilities in the worst-performing 25% are penalized by losing 1% of their Medicare payments. So far, the program has penalized 1,756 hospitals since it was established in 2014, and 110 of those hospitals have been penalized all five years. Congress exempts the United States' more than 1,000 critical access hospitals, as well as Maryland hospitals and certain specialized hospitals (children's, psychiatric, and veterans), from the penalties.

    The hospital industry has argued that the HAC methodology uses an arbitrary cutoff. The American Hospital Association last year published an analysis that found only 41% of the 768 hospitals penalized in 2017 had HAC rates significantly higher than the hospitals which were not penalized. The industry also has argued the methodology punishes hospitals that thoroughly test for infections and other patient-safety hazards, as they might uncover more problems and appear statistically worse than hospitals with lower testing standards.

    Penalties not having desired effect

    For the study published in The BMJ, researchers analyzed data on more than 15.4 million Medicare beneficiaries who were discharged from 3,238 acute care hospitals between July 23, 2014, and Nov. 30, 2016, and looked at three metrics:

    • HACs per 1,000 episodes;
    • 30-day readmission rates; and
    • 30-day mortality rates.

    According to the researchers, a total of 724 hospitals were penalized under the HAC program in fiscal year 2015, and 708 of those hospitals were included in the study. The researchers found that those 708 hospitals had an average had HAC rate of 2.72 per 1,000 episodes, compared with an average rate of 2.06 per 1,000 episodes among non-penalized hospitals.

    The researchers also found that the average 30-day readmission rate among the 708 penalized hospitals was 14.4%, compared with 14% among non-penalized hospitals. The average 30-day mortality rate among both penalized and non-penalized hospitals was 9%, according to the study. Overall, the researchers noted that HAC program penalties were associated with non-significant decreases of:

    • 0.16 HACs per 1000 episodes;
    • 0.36 percentage points in 30 day readmission rates; and
    • 0.04 percentage points in 30 day mortality rates.

    The most common HACs the researchers identified were:

    • Post-operative blood clots in major blood vessels;
    • Air or gas leaks between the lungs and chest wall;
    • Bloodstream infections; and
    • Pressure sores.

    The researchers also found that safety-net and teaching hospitals were penalized most often when compared with other hospital types. According to the researchers, the hospitals that were penalized most often were more likely to treat "a greater share of patients with low socioeconomic status than non-penalized hospitals." The researchers wrote that they did not observe any "clear patterns of clinical improvements … across hospital characteristics."


    The researchers wrote that the HAC penalties do "not appear to drive meaningful clinical improvements," and that "[b]y disproportionately penalizing hospitals caring for more disadvantaged patients, the [HAC program] could exacerbate inequities in care."

    According to Karl Bilimoria, director of the Surgical Outcomes and Quality Improvement Center at Northwestern University Feinberg School of Medicine who was not involved in the study, the study's results show that HAC program "is paradoxically penalizing high-performing hospitals and those hospitals taking care of socioeconomically disadvantaged patients." He said the program's "individual measures and overall methodology continue to have critical flaws that need to be addressed," adding, "Thus, it is not surprising that [penalties] have failed to result in better patient outcomes" (Bean, Becker's Clinical Leadership & Infection Control, 7/10; Rapaport, Reuters, 7/10; Sankaran et al., The BMJ, 7/3).

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