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Study estimates hospital penalties generate few savings for Medicare

Wall Street Journal, September 9, 2009

The government won't save much from Medicare's year-old policy of refusing to pay hospitals' extra costs to treat hospital-acquired infections and injuries such as bedsores, a new study concludes. Medicare adopted the policy last year with the goal of saving lives and cutting costs. Medicare stopped paying the extra costs of treating 10 hospital injuries and infections beginning Oct. 1, 2008. The study by California researchers examined California discharge data for Medicare beneficiaries in 2006, looking for six conditions the authors deemed "definable." They found that out of 767,995 cases in all, 828 cases involved those conditions, and only 26 of the cases would have been subject to lower payments.