Never Events, Defensive Medicine and the Continued Federalization of Malpractice
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1 Never Events, Defensive Medicine and the Continued Federalization of Malpractice Devin S. Schindler* I. Introduction Consider the lowly bedsore. Caused by unrelieved pressure on the skin, bed sores, technically known as "debucbitus ulcers," have long been the bane of nursing homes and acute care hospitals. Literally volumes have been written on the cause, prevention and treatment of bed sores. Yet, despite the hard work of thousands of dedicated health care professionals, bed sores remain a serious medical problem.' Now, however, after several years of discussion, the Center for Medicare and Medicaid Services (CMS) has found a solution to the intractable problem of bed sores. It is going to stop paying the cost of treating them. On July 31, 2008, CMS announced that as of October 1, 2008, it was no longer going to pay hospitals the additional costs associated with a series of avoidable "Hospital Acquired Conditions" (HAC) known as "never events." 2 Although the fiscal impact of these new rules should be relatively modest, CMS's new "never events" non-payment policy has the potential to increase the cost of internal risk and compliance management systems without a concomitant improvement in patient safety. And, as is the case with most major changes in the Inpatient Prospective Payment System (IPPS), * Associate Professor, Thomas M. Cooley School of Law; J.D., University of Michigan, Magna Cum Laude, Order of the Coif; B.A., James Madison College and the Honors College at Michigan State University. I See e.g, Prevention of Pressure Related Damage, 1 Best Practice, Issue 1 (1997). In Europe, to site one of many examples, a multinational advisory group, known as the "European Pressure Ulcer Advisory Panel" was formed to coordinate efforts among European nations to prevent and treat pressure ulcers. EUROPEAN PRESSURE ULCER ADVI- SORY PANEL, 2 CTR.S FOR MEDICARE & MEDICAID SERV.S, CHANGES To PAYMENT POLICIES AND RATES FOR INPATIENT REutAB. FACILITIES IN FISCALYFAR 2009 (July 31, 2008), cms.hhs.gov/apps/media/press/factsheet.asp?counter=3216&intnumperpage=i 0& checkdate=&checkkey=&srchtype=1&numdays=3500&srchopt=0&srchdata=&key wordtype=all&chknewstype=6&intpage=&showall=&pyear=&year=-&desc=false&cbo Order=date. 209
2 210 QUINNIPIAC HEALTH LAW [Vol. 12:209 there is a risk that the never events initiative will have serious, unintended consequences. II. Never Events CMS's never events policy is rooted in the now famous 1999 Institute of Medicine (IOM) Report "To Err is Human: Building a Safer Health System." ' 3 In this report, the IOM concluded that up to 98,000 patients died annually as a result of avoidable medical errors. 4 This report, the first of three by the IOM, made a number of recommendations to minimize medical errors. One of those recommendations, involving the reporting of adverse medical events, was the genesis of the Reporting Hospital Quality Data for Annual Payment program, pursuant to which hospitals are "encouraged" to report various quality measurements to allow consumers to make informed choices. 5 The ongoing "pay for performance" movement, embodied in the Premier/Hospital Quality Improvement Demonstration pilot program, also arose largely from the IOM reports. 6 The new never events policy is the third major initiative implemented by CMS which traces back to the IOM report. More recently, CMS concluded, citing a study performed by the Leapfrog Group, that 87% of hospitals do not follow certain unidentified "recommended guidelines" to prevent Hospital Acquired Conditions. 7 The agency further concluded that total national costs of medical errors exceeded $17 billion, and that 3 CTR.S FOR MEDICARE & MEDICAID SERV.S, PRESS RELEASE, CMS PROPOSES THREE NATIONAL COVERAGE DETERMINATION TO PROTECT PATIENTS FROM PREVENTABLE SURGI- CAL ERRORS (Dec. 2, 2008), Counter=3375&intNumPerPage=0&checkDate=&checkKey=&srchType=1&numDays= 3500&srchOpt=0&srchData=&keywordType=All&chkNewsType=1%2C+2%2C+3%2C+ 4%2C+5&intPage=&showAll=&pYear=&year=&desc=false&cboOrder=date. 4 LINDA T. KUHN ET AL., To ERR IS HuMAN: BUILDING A SAFER HEALTH SYSTEM 26 (Linda T. Kohn et al., eds., National Academy Press 2000) (1999), available at For a more detailed discussion of the Reporting Hospital Quality Data for Annual Payment program, see Devin S. Schindler, Pay for Performance, Quality of Care and the Revitalization of the False Claims Act, 19 HEALTH MATRIX (forthcoming 2009). 6 Id. 7 CTR.S FOR MEDICARE & MEDICAID SERV.S, PRESS RELEASE, CMS PROPOSES TO Ex- PAND QUALITY PROGRAMS FOR Hosp. INPATIENT SERV.S IN FY 2009 (Apr. 14, 2008), / 0 &checkdate=&checkkey=&srchtype=l &numdays=3500&srchopt=0&srchdata=&key wordtype=all&chknewstype= 1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&p Year=&year=&desc=false&cboOrder=date.
3 2009] FEDERALIZATION OF MALPRACTICE hospital acquired conditions or mistakes alone cause 98,000 deaths annually at a cost of $5 billion.' Building from the work of the IOM, the National Quality Forum (NQF) published a list of twenty-seven avoidable medical errors in 2002 that the Forum concluded were "serious, largely preventable and of concern to both the public and health care providers." 9 The NQF created the list at the direction of the IOM in an effort to provide payors in general, and the federal government in particular, with a list of events to include in a comprehensive reporting system. 10 The IOM report and NQF list, in turn, begat a series of "value based purchasing" initiatives, pursuant to a congressional directive requiring CMS to restructure payment mechanisms to encourage quality improvements." As stated by CMS, value based purchasing initiatives are designed to evolve CMS from a mere "public payor" to an "active purchaser," responsive to quality improvements. 12 Consistent with this directive, Congress, as part of the Deficit Reduction Act of 2006 (DRA), directed CMS to develop a list of secondary diagnosis codes consisting of medically avoidable conditions for which reimbursement would no longer be allowed.' 3 Under the statute, to qualify for the list (and become, therefore, no longer reimbursable), the diagnosis code had to meet three requirements: 1) The listed code has "a high cost or high volume;" 8 See id.; see also 73 Fed. Reg. 48,434, 48,471 (Aug. 19, 2008) (to be codified at 42 C.F.R. pts. 411, 412, 413, 422, and 489). 9 NATIONAL QUALITY FORUM, SERIOUS REPORTABLE EVENTS IN HEALTHCARE, Forward (2002). See also NAT'L QUALITY FORUM, NAT'L QUALITY FORUM UPDATES ENDORSE- MENT OF SERIOUS REPORTABLE EVENTS IN HEALTH CARE, Press Release (Oct. 16, 2006), (follow "Press Release 10/16/ 06: NQF Updates Endorsement of Serious Reportable Events" hyperlink). 10 See NAT'L QUALITY FORUM, supra note U.S.C. 1395ww(2) (c) (2009) (directing the Secretary of HHS to "structure. value based payment adjustments, including the determination of thresholds or improvements in quality that would substantiate a payment adjustment, the size of such payments, and the sources of funding for the value based payments.") 12 CTR.S FOR MEDICARE & MEDICAID SERV.S, CMS IMPROVES PATIENT SAFETY FOR MEDICARE AND MEDICAID BY ADDRESSING NEVER EVENTS (Aug. 4, 2008), hhs.gov/apps/media/press/factsheet.asp?counter-3224&intnumperpage=i0&check Date=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&keywordType =All&chkNewsType=6&intPage=&showAll=&pYear=-&year=-&desc=false&cboOrder= date U.S.C. 1395ww (4) (D) (iv) (I-II) (2009).
4 212 QUINNIPIAC HEALTH LAW [Vol. 12:209 2) The condition has "a higher payment when the code is present as a secondary diagnosis;" and 3) The code describes "such conditions that could reasonably have been prevented through the application of evidencebased guidelines." 14 According to CMS, authority to deny payment for conditions that meet this criteria is an important tool to "combat Hospital Acquired Conditions" and to "promote increased quality and efficiency of care."15 Congress did not adopt the four criteria used by the National Quality Forums in developing its list of never events; namely that the condition (1) "be clearly identifiable;" (2) "usually preventable;" (3) have "serious and possibly fatal consequences;" and (4) be "indicative of a problem in a facility's safety systems." 16 Recognizing that the NQF list was created for reporting purposes-and not as a basis for making reimbursement decisions-the NQF also included an alternative for subparagraph four that the listed conditions be otherwise "important for public credibility or accountability."'" Despite the different criteria, seven of the eight conditions initially placed on CMS's list also appear on the NQF list. 18 Armed with this directive, CMS selected eight categories of conditions for inclusion on the list of "Hospital Acquired Conditions" that would, as of October 2008, no longer qualify for reimbursement. As part of the 2009 Inpatient Prospective Payment System rulemaking process, CMS identified an additional nine candidates for inclusion on the list. 19 The final list, effective October 2, 2008, contains the following conditions: * Object left in patient during surgery; " Air embolism; 14 Id. 15 KUHN ET AL., supra note National Quality Forum, NQF-Endorsed Serious Reportable Events in Healthcare: 2006 Update 4 (2006). 17 Id. 18 CTR.S FOR MEDICARE & MEDICAID SERV.S, INCORPORATING SELECTED NAT'L QUAL- ITY FORUM AND NEVER EVENTS INTO MEDICARE'S LIST OF HOSP.-AcQuIRED CONDITIONS (Apr. 14, 2008), &intNumPerPage= 10&checkDate=&checkKey=&srchType=l &numdays=3500& srchopt=0&srchdata=&keywordtype=all&chknewstype=6&intpage=&showall=&p Year=&year=&desc=false&cboOrder=-date Fed. Reg. 48,434, 48,
5 20091 FEDERALIZATION OF MALPRACTICE 213 " Blood incompatibility; * Catheter-associated urinary tract infection; * Pressure ulcers; " Vascular-catheter-associated infection; * Surgical site infection (specifically mediastinitis after coronary artery bypass graft surgery); * Hospital-acquired injury due to external causes (fractures, dislocations, intracranial injury, crushing injury, burns, and other unspecified effects); * Surgical site infections following certain orthopedic procedures and bariatric surgery for obesity; * Manifestations of poor blood sugar control, such as diabetic ketoacidosis and hypoglycemic coma; and * Deep vein thrombosis or pulmonary embolism associated with total knee and hip replacement procedures 20 Separately, CMS used its authority under Section 1862 (a) (1) (A) of the Social Security Act 21 to deny payment for items that are not "reasonable and necessary" for the treatment of an illness as a basis to publish three National Coverage Decisions which, collectively, will have the effect of prohibiting payment for (a) the wrong surgery performed on a patient, 22 (b) surgery performed on the wrong body part 23 and (c) surgery performed on the wrong patient. 24 The different methodology for listing these three "never events" was necessary because "wrong patient/wrong surgery" medical errors do not meet the DRA's requirements of being "high volume" and/or identifiable through the ICD 9 as "complicating conditions." Id U.S.C. 1395y(a)(1)(A) (2008). 22 CTR.S FOR MEDICARE & MEDICAID SERv.S, DECISION MEMO FOR WRONG SURGERY PERFORMED ON A PATIENT (CAG-00401N) (Dec. 12, 2008), mcd/viewdecisionmemo.asp?id= CTR.S FOR MEDICARE & MEDICAID SERY.S, DECISION MEMO FOR SURGERY ON THE WRONG BODY PART (CAG-00402N) (Dec. 12, 2008), viewdraftdecisionmemo.asp?id= CTR.S FOR MEDICARE & MEDICAID SERV.S, DECISION MEMO FOR SURGERY ON THE WRONG PATIENT (CAG-00403N) (Dec. 12, 2008), 25 CTR.S FOR MEDICARE & MEDICAID SERV.S, MEDICARE TAKES NEW STEPS TO HELP MAKE YOUR Hosp. STAY SAFER (Aug. 4, 2008), press/factsheet.asp?counter3227&intnumperpage= I0&checkDate=&checkKey=&srch Type=l &numdays=3500&srchopt=0&srchdata=&keywordtype=all&chknewstype=6& intpage=&showa]l=&pyear=&year=&desc=false&cboorder=date.
6 214 QUINNIPIAC HEALTH LAW [Vol. 12:209 The actual financial impact of the newly implemented never events policy is difficult to discern. The policy will certainly have an effect on "higher weighted" medical severity adjusted diagnosis related groups (DRG's), at least to the extent the adjusted diagnosis resulted from a hospital acquired condition. By way of example, the DRG for a stroke provides for a fiftieth percentile payment of $ An adjustment for a stroke combined with a stage III pressure sore (code ) pays $ Accordingly, if a pressure sore is present when the patient is admitted, the hospital will be paid the full $ If the sore develops when the patient is at the hospital, however, the payment will be limited to the $5347 reimbursement figure. 29 The October initiatives are not the final word on the future of never events. Simultaneous with the release of the new policy, CMS sent a letter to all state Medicaid directors encouraging them to implement a similar policy for never events. 30 CMS is also considering an expansion to include other medical providers, including home health agencies and skilled nursing homes. 3 ' Three states have already implemented such plans and, according to CMS, more states are considering doing so. And, where CMS goes, private payors are bound to follow. 32 III. An Overreaction to a Non-Existent Problem? Few would argue that hospitals should not be paid for the costs associated with remedying gross errors. If the hospital leaves a surgical tool in your abdominal cavity, the hospital should bear, at a minimum, the cost of removing it. Other aspects of the policy, however, raise serious questions as to 26 CTR.S FOR MEDICARE & MEDICAID SERV.S, OVERVIEW, HosP. ACQUIRED CONDITIONS (PRESENT ON ADMISSION INDICATOR), 27 Id. 28 Id. 29 Id. 30 Letter from Herb B. Kuhn, Deputy Administrator, Acting Director, Center for Medicaid and State Operations, to State Medicaid Director(s) (July 31, 2008), available at 31 AM. SOC'Y FOR QUALITY, THE QUARTERLY QUALITY REPORT 7 (Oct. 2008), (follow "Download the Report" hyperlink). 32 See e.g., Lee Masterson, Defensive Medicine?, HEALTHLEADERS MAGAZINE, Aug. 12, 2008, available at ic/ws_hlm2_mag/defensive-medicine.html (Noting that Wellpoint, Aetna and Cigna will no longer pay for "never events" defined by CMS).
7 20091 FEDERALIZATION OF MALPRACTICE 215 whether CMS is overreacting to a nonexistent or minor problem and whether the new policy will truly result in better patient care, particularly if it is expanded. A close analysis of the new policy suggests that the factual supposition underlying the program-namely that hospitals are killing off tens of thousands of patients annually as a result of medical errors-is suspect. Perhaps more troubling, the never events policy is unlikely to have the cost benefits and improved quality of care claimed by CMS. 33 Rather, the most likely impact of the program will be to raise the cost of practicing medicine without substantially improving patient care. 34 In regards to the former, CMS's reliance on the death figures cited by the Institute of Medicine is misplaced. Since these figures were first derived, substantial evidence has been collected to suggest that the number of "avoidable" patient deaths is no where near the problem assumed by CMS. To cite one example, in 2003, the state of Minnesota passed a statute requiring mandatory reporting of the twenty-seven "never events" defined by National Quality Forum. 35 In the first two years of the program, 205 adverse events causing 34 deaths were reported. 3 6 Extrapolating this data nationwide would result in a two year total of 12,036 adverse events and 2294 deaths; far short of the 98,000 annual death figure asserted by CMS. The data reported from NewJersey, which enacted a similar reporting law, 37 is consistent with the Minnesota experience. In 2007, seventy-five New Jersey hospitals reported 456 adverse events, which allegedly caused seventy-two deaths. 38 If the New 33 Id. 34 Id. 35 MINN. STAT (2003). 36 CTR.S FOR MEDICARE & MEDICAID SERV.S, FACT SHEET: ELIMINATING SERIOUS, PRE- VENTABLE, AND COSTLY MED. ERRORS-NEVER EVENTS (May 18, 2006), hhs.gov/apps/media/press/release.asp?counter=1863. Between October 2007 and October 2008 a total of 312 adverse events, causing 18 deaths, was reported. MINN. DEP'T OF HEALTH, ADVERSE EVENTS IN MINN.: FiFrH ANNUAL PUB. REPORT 19 (Jan. 2009), Part of the increase is due to changes in the definition of "adverse events." Id. at See generally N.J. Patient Safety Act, N.J. STAT ANN. 26:2H (2004). 38 N.J. DEP'T OF HEALTH AND SENIOR SERV.S, PATIENT SAFETY INITIATIVE 2007 SUM- MARY REPORT 11, 19 (Dec. 2008), ps..initiative-report07.pdf. A total of at least twenty-five states have enacted some form of adverse event reporting law. NAT'L ACADEMY FOR STATE HEALTH POLICY, QUALITY AND PATIENT SAFETY. STATE ADVERSE EVENTS REPORTING RULES AND STATUTES (Dec. 5, 2005),
8 216 QUINNIPIAC HEALTH LAW [Vol. 12:209 Jersey data is extrapolated nationwide, the result would be a one year total of a 22,800 adverse events and 3600 deaths. 39 Even taking into account the likelihood of substantial underreporting, the actual numbers still pale in comparison to the IOM estimates. Given the apparent disconnect between the actual numbers and CMS's assertion that nearly 100,000 people die annually from hospital mistakes raises the question of whether the entire basis for the never events policy is flawed. This, in turn, requires a more thorough review of the IOM's methodology. The Institute of Medicine relied on two studies for its figures. In the first, entitled "Incidence of Adverse Events and Negligence in Hospitalized Patients," 4 the authors reviewed 30,120 randomly selected records from fifty-one acute care hospitals located in New York. Based on their review, the authors concluded that 3.7% of hospitalizations were due to adverse events, of which approximately 25% were due to negligence. CMS relied on this study to derive the 98,000 figure. 4 ' In the second study, researchers reviewed 15,000 patient charts from Utah and Colorado. 42 The authors, using the same methodology as the New York study, generally agreed with the previous study, but concluded that a lower percentage of adverse events actually resulted from negligence. 43 CMS derived the lower range of avoidable deaths, 44,000, from this study. 4 4 Critical to the analysis, neither the New York study nor the Utah/Colorado studies concluded that medical errors caused between 44,000 and 98,000 deaths annually, nationwide. Rather, CMS and the IOM extrapolated those numbers from their own analysis of the data. In doing so, however, CMS failed to apprecihttp:// 1D6-BCF000AOCC See NJ. DEP'T OF HEALTH AND SENIOR SERV.S, supra note 38; see also NATIONAL ACADEMY FOR STATE HEALTH POLICY, supra note Troyen A. Brennan et al., Incidence of Adverse Events and Negligence in Hospitalized Patients: Results of the Harvard Medical Practice Study I, 324 N. ENG. J. MED. 370, (1991). 41 Id, 42 Eric J. Thomas et al., Incidence and Types of Adverse Events and Negligent Care in Utah and Colorado. 38 Med. Care (2000). 43 Id. 44 ClementJ. McDonald, Michael Wiener & Siu L. Hui, Deaths Due to Medical Errors Are Exaggerated in Institute of Medicine Report, 284 JAMA 94 (July 5, 2000).
9 20091 FEDERALIZATION OF MALPRACTICE 217 ate the inherent limitations of the two studies. First, the researchers' methodology had a built in bias towards overstating deaths resulting from the manner in which they screened cases for further review. One of the first steps the authors took was to apply screening criteria to define a subgroup of cases where medical errors were more likely to be prevalent, known as "adverse events." 45 One of these criteria was death. 46 In other words, cases where patients died were, by definition, subject to a higher level of review than other cases used to determine whether a medical mistake occurred. Thus, the total number of cases that the authors actually reviewed was weighted heavily to include numerous deaths. To exaggerate only slightly, if one reviews only death cases to establish malpractice, the natural bias will be to exaggerate the number of deaths caused by malpractice. 47 After reviewing the cases that satisfied the prescreening criteria, the group concluded that medical errors were present in the charts for 173 patients who ultimately died. CMS's error was that it implicitly assumed a "but for" causation relationship for each of the cases; that "but for" the alleged medical error, the patients would have lived. 48 The authors of the study made no such claim. First, the authors made no effort to determine the percentage of deaths that were truly avoidable, only that the medical error may have contributed to the patients' demise. As common sense would suggest, some, and perhaps a majority, of the patients included on the list of the 173 would have died irrespective of the underlying medical error. 49 At least one of the authors of the two studies, Dr. Troyen Brennan, has voiced "reservations" regarding the IOM's use of 45 Troy A. Brennan et al., Reliability and Validity of Judgments Concerning Adverse Events and Negligence, 27 MED. CARE 1148 (1989). 46 Other criteria included patients that were returned to intensive care after being discharged to the general patient population and patients who had an "excessive" length of stay. See id. 47 See Rodney A. Hayward &Timothy P. Hofer, Estimating Hospital Deaths Due to Medical Errors Preventability is in the Eye of the Reviewer, 286 JAMA 415 (July 25, 2001) ("(1)n most cases some reviewers will strongly believe that death could have been avoided by different care; however, most of the 'errors' identified in implicit chart review appear to represent outlier opinions in cases in which the median reviewer believed either that an error did not occur or that it had little or no effect on the outcome."). 48 Susan Dentzer, Media Mistakes in Coverage of the Institute of Medicine's Error Report, AM. COLLEGE OF PHYSICIANS (Nov./Dec. 2000). 49 Id.; see generally McDonald, Wiener & Hui, supra note 44.
10 QUINNIPIAC HEALTH LAW [Vol. 12:209 his work. He has argued that the impression left by the IOM report is "not warranted" by the actual conclusions of his studies and that the IOM's definition of medical errors "may seem inappropriate."" Indeed, as early as 2000, Dr. Troyen "cautioned against drawing conclusion[s] about the number[] of deaths in (his) studies" and, contrary to the IOM (and subsequently CMS's) conclusions, he believes that hospital safety "has improved, not deteriorated."'" Dr. Brennan's observation highlights yet another problem with CMS's continued reliance on the New York study. Although the study was published in 1991, it was based on medical records from In the last twenty-five years, hospitals have implemented dozens, if not hundreds, of new evidence-based procedures to better prevent the exact kind of medical errors identified by the New York study. 5 2 Most critically, the information predates the creation of the Joint Commission, which, over the last twenty-three years, has overseen the implementation of innumerable patient quality and safety initiatives throughout all facets of the health care industry. 3 Although medical errors remain a problem and will always be a problem given human frailties, CMS continues to justify wide ranging policies such as "never events," using data that is stale, at best, or irrelevant at worse. IV. The Hidden Costs of the Never Events Policy Again, common sense dictates that hospitals should not be paid for obvious and gross negligent care, such as leaving surgical tools in a body cavity. The more difficult case, however, lies with the policy's exclusion of certain conditions that occasionally occur despite every reasonable effort to avoid them. Surgical in- 50 Troyen A. Brennan, The Institute of Medicine Report on Medical Errors-Could It Do Harm?, 342 NEW ENG. J. MED (Apr. 13, 2000). 51 Id. 52 To cite one of many examples, in 2006 the Joint Commission launched its "Patent Safety Practice" initiative, a series of guidelines and programs designed to reduce patient risk through application of evidenced based practices in the areas medication safety, infection control and overall patient environment. TheJoint Commission claims that over 10,000 health care facilities or providers subscribe to its patient safety policies and procedures. JOINT COMMISSION RESOURCES, PARTNERING FOR BETTER OUTCOMES: ANNUAL REPORT (2007), %20annual%20report.pdf. 53 Id.
11 20091 FEDERALIZATION OF MALPRACTICE fections and catheter induced infections can be minimized, but never completely eliminated. Best medical practices can limit, but never fully eliminate, pressure sores. 5 4 Hospital floors and equipment can be built of goose down, and yet patients will still find ways to fall and injure themselves. Thus, the question becomes whether CMS's never events policy will have any kind of positive effect on patient safety. For the vast majority of hospitals, the answer is likely to be no. By definition, a never event is (supposedly) avoidable through the application of evidence-based guidelines. Presumably, most wellrun hospitals have already or were in the process of implementing the kind of evidence-based guidelines "encouraged" by the never events policy, well before the policy went into effect. 55 Long ago, most hospitals implemented checklists and guidelines to insure that surgeries were performed on the correct patients and correct body parts. 56 Furthermore, an entire cottage industry exists for the prevention and treatment of bed sores. 7 Nor will the never events policy likely result in substantial cost savings. Again, many, if not most, hospitals have already made a policy decision not to collect costs associated with the hospital's own medical errors; if for no other reason than to provide less encouragement for malpractice suits. 54 A pilot study performed at Memorial Hermann Southwest Hospital in Houston, Texas illustrates the intractability of the bed sore problem. Over a nine month period, an interdisciplinary team implemented a series of best practices to eliminate bed sores. Among other things, patients were given weekly skin audits, skin assessments upon admission and were subject to aggressive treatment when problems were discovered. Despite the team's best efforts, 2.7% of patients admitted to the hospital still ended up with bed sores. To the group's credit, the Hospital did dramatically decrease the percentage of patients with bed sores from a high of 12%. According to the study, the national average is 7%. Senaida Garza et al., Hospital Project Reduces 'Bed Sores' to an Industry Low, Six Sigma Healthcare, c060412a.asp. 55 In Minnesota, to site one example, at least 80% (or more) of the facilities subject to the state mandatory reporting statute claim to have implemented any number of best practices, including regularized assessments of patient safety culture, increased and improved reporting, and implementation of measurable patient safety goals. MINN. DEP'T OF HEALTH, ADVERSE HEALTH CARE EVENTS REPORTING SYSTEM: WHAT HAVE WE LEARNED? FIVE YEAR REVIEW 11 (Jan. 2009), ty/publications/09aheeval.pdf; see alsojoint COMMISSION RESOURCES, supra note The National Quality Fourm, NQF-Endorsed Serious Reportable Events in Healthcare: 2006 Update 10 (2006) (directing hospitals to adopt a list of surgical procedures to avoid surgical errors like, inter alia, those identified in the never events policy). 57 See Prevention of Pressure Related Damage, supra note 1; see also EUROPEAN ULCER ADVISORY PANEL, supra note 1.
12 220 QUINNIPIAC HEALTH LAW [Vol. 12:209 More likely, the new never events policy will have two perverse effects, neither of which will result in cost savings or better medical care. For hospitals that have already implemented "evidence based guidelines," the most logical response to the never events policy is to require staff to more thoroughly document pre-existing conditions to insure that they are not ultimately blamed (and denied payment) for incipient conditions for which payment is no longer eligible. In practical terms, this means a combination of (1) more paperwork for practitioners; and/or (2) hiring new personnel whose job it will be to make sure no one gets through the doors without a second check to insure that pre-existing conditions are absent. Either result leads to higher costs for hospitals with no benefit to overall patient care. Adding more subtlety, the never events policy will also make the relationship between different branches of the health care industry more adversarial. This is particularly true in terms of the relationship between nursing homes and critical care hospitals. Faced with the loss of reimbursement, hospitals will have every incentive to blame previous caregivers for the existence of only marginally extant conditions. Hence, a stage one bedsore on a patient who has been transferred from a nursing home, for which repayment can still be recovered by the hospital, may be suddenly diagnosed as a stage two bedsore in the admitting documentation. A patient whose insulin levels are low, but who is otherwise fine, may be diagnosed for purposes of admission with incipient diabetic ketoacidosis. As hospitals become more conscious of the financial risk posed by pre-existing conditions, they will have a built-in incentive to label any applicable condition from the never events list as a manifestation of poor care by the transferring facility, irrespective of whether the condition truly exists. This problem will be compounded when the never events policy is expanded to nursing homes. Already, CMS has indicated that the percentage of high risk patients with pressure sores will be one of the measurements used in its upcoming "Nursing Home Value Based Purchasing" demonstration project. And, as every nursing home administrator knows, bed sores
13 2009] FEDERALIZATION OF MALPRACTICE play heavily in the state inspection and licensing scheme." Like hospitals, the extension of the never events policy to nursing homes will give nursing home administrators a powerful incentive to blame every never events problem on the transferring hospital. In either case, time and money will be spent playing the "blame game," instead of using those limited resources to truly improve patient care. V. Conclusion So what is a conscientious risk or compliance manager to do in the face of CMS's newly minted never events policy? For a majority of facilities the answer, surprisingly, is "very little." The underlying problems addressed by the policy-avoidable surgeries, bed sores and the like-should long ago have been addressed by any facility concerned with quality and resolved through implementation of evidence-based guidelines. On the payment side, only the most cavalier facilities continue to charge patients for obviously botched surgeries and medical problems caused by the hospital itself. To the extent a facility has not done so, a new policy prohibiting the billing of the costs related to medical mistakes, with appropriate education, is long overdue. CMS's never events policy embodies the rather obvious principal that hospitals should not be paid to correct their own mistakes. CMS is unlikely to see substantial savings or substantial gains in patient quality of care as a result of this new policy, however. The biggest threat of the policy is that facilities will overreact, creating additional rules and layers of bureaucracy without advancing the mission of improving patient care. 58 CTR.S FOR MEDICARE & MEDICAID SERV.S, ProjectsEvalRpts.
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