Medicaid to stop paying for 'never' events in July

Medicaid will stop reimbursing states for any amounts expended for providing medical assistance for provider-preventable events, including healthcare-acquired conditions, effective July 1.

Previous rules specified reduced payments for hospital-acquired conditions (HACs) such as foreign object retained after surgery, manifestations of poor glycemic control, catheter-associated urinary tract infection and surgical site infection following coronary artery bypass graft, bariatric surgery or orthopedic procedures.

Until this rule, states had flexibility to pay for these complications, or 'never' events. However, only 29 states developed nonpayment policies for these conditions. The new rule closes the gap.

The U.S. Department of Health and Human Services (HHS) noted that it is difficult to estimate the cost impact of the rule. A Congressional Budget Office analysis suggested aggregate cost savings of $35 million for fiscal years 2011 through 2015.

HHS projected a minimal impact on hospitals, noting that most have prevention programs that target HACs “and thus would not incur new costs to implement parallel programs to avert Medicaid [HACs].”

The rule also authorized states to identify other provider-preventable conditions for which Medicaid payment will be prohibited.