$330 Million Risk: What Boards Should Know

July 20, 2015

Rodney Hochman, MD, Group President and CEO of Providence Health & Services

In his article that advises American Hospital Association member trustees, Rodney Hockman, MD warns that hundreds of hospitals are likely to be penalized by Medicare for patient injuries under the Hospital-Acquired Condition (HAC) Reduction Program starting in October 2014. He points out that each penalized hospital stands to lose nearly $434,000 in Medicare reimbursements on average, with large hospital systems and those with a high volume of Medicare payments potentially facing much greater losses should they provide unsafe care.

Dr. Hochman points to institutions using a bundle of best practices to address this,  including 353-bed White Memorial Hospital, part of the Adventist Health System in Los Angeles, to eliminate two of the serious complications used to determine penalties under Medicare’s HAC Reduction Program: pneumothorax and central line-associated bloodstream infections (CLABSIs).  Both conditions are now included on AHRQ’s list of patient safety indicators. 

Now there’s a growing movement to add ultrasound-guided central-line placement as a sixth component of the bundle. Hospitals that have adopted the approach, including Cedars-Sinai Medical Center in Los Angeles, have seen striking reductions in CLABSIs. White Memorial was able to achieve a rate of zero between January 2010 and August 2011.   With this knowledge, hospital trustees have potential play a meaningful role in helping their hospitals make a successful transition from volume-based to value-based care, while reducing the risk of incurring severe financial penalties.

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