Medicare's Decision to Withhold Payment for Hospital Errors: The Devil Is in the Details

Background: Medicare recently announced its intention to withhold additional payments for "serious preventable events." The Intervention: Beginning in 2009, Medicare will withhold its usual additional payments associated with hospitalizations that included one of several potentially preventable adverse events, such as certain hospital-acquired infections, pressure ulcers, and retained surgical objects. Several more events are being considered for the future. A new coding category, "present on admission" (POA), has been added to identify patients whose adverse events occurred before the index hospitalization. Issues and Challenges: A "not paying for errors" policy seems reasonable if evidence demonstrates that most of the adverse events can be prevented by widespread adoption of achievable practices, the events can be measured accurately, the events resulted in clinically significant patient harm, and POA determination is feasible. Many of these criteria are met for the events in Medicare's starter set; but there are concerns about each event. Conclusions: Although the new Medicare policy will undoubtedly lead to instances of unfairness, gaming, and unforeseen consequences, it may be effective. This initial implementation should be considered a bold experiment, whose consequences are carefully monitored. Additional research will be needed to help identify preventable adverse events and evidence-based strategies to prevent them.