More on Reimbursement

Drop in hospital-acquired conditions results in $7.7 billion in savings for providers

CMS had hoped the threat of penalties would focus more attention on improving care quality, but most of the changes have been to coding practices.

Jeff Lagasse, Associate Editor

Healthcare providers saved $7.7 billion over a three-year period from 2014 to 2017 due to a 13 percent drop in hospital-acquired conditions over that time, finds the Agency for Healthcare Research and Quality.

In 2014, hospitals reported 2.94 million HACs for all inpatients 18 years and older. Three years later, that number dropped to 2.55 million HACs. Broken down annually, that means an average annual reduction of 4.5 percent.


Part of the reason for the dip may be the threat of penalties from the Centers for Medicare and Medicaid Services. Its Hospital-Acquired Condition Reduction Program, implemented in 2014, means hospitals may be penalized for their HAC rates.

On top of that, its Hospital Improvement Innovation Networks has seen hospital participation to the tune of about 4,000, meaning those hospitals have evidence-based policies and practices in place to address patient safety issues.

Not all HACs declined during the three-year window. Pressure ulcers, for example, went up 6 percent.

That was more than made up for by large declines in other HACs, such as adverse drug events, which dipped 28 percent from 2014 to 2017.

CMS' current goal is a 20 percent reduction in HACs by this year, which would translate to a $19.1 billion savings for providers and 53,000 fewer deaths.


Potential CMS penalties may be having an impact on HAC rates, but research published in June suggests that impact may be minimal.

In fact, hospitals may have avoided financial penalties by billing HACs as present at the time of the patient's admission -- supporting prior work showing that a Medicare policy designed to monetarily penalize hospitals for preventable complications had a minute impact on reducing healthcare-associated infections.

In addition, the targeted billing codes were rarely used by hospitals, far less than expected based on national estimates. And even when hospitals billed for HACs during a hospitalization, this infrequently affected the diagnosis-related group assignment, impacting hospital reimbursement.

CMS had hoped the policy would focus more attention on improving care quality, but instead it appears most of the changes have been to coding practices, the research showed.

Twitter: @JELagasse

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