Harmful Event Detection Misses Problems, Results in Medicare Overpayments, Says OIG

The system that the Centers for Medicare and Medicaid Services uses to identify hospital-caused incidents that harm patients misses many such adverse events, resulting in Medicare overpayments and lost opportunities to prevent their recurrence, as required by federal law.

That's the conclusion of a new report from the Office of Inspector General, which said that one major method used to detect those adverse events failed to work in 93% of 120 cases reviewed in 2008.

"Further, hospitals had no incident reports for two of three events that resulted in death to the patients or two of the four events that resulted in serious disability," according to OIG.

"The lack of hospital incident reports could prevent hospitals from tracking events as required or reporting events to outside entities," according to the report, entitled "Adverse Events in Hospitals, Method of Tracking Events."

A second major method of detection is the record of "present on admission" or POA, a system hospitals are supposed to use to log conditions with which the patient arrives.

When the record shows that a particular condition was not present upon the patient's admission, CMS can conclude that the condition developed during the hospital stay and might have been the result of a preventable adverse event.

But the OIG's "POA analysis revealed problems that could inhibit CMS' ability to identify hospital acquired conditions and appropriately deny Medicare payments," the report said.

For example, in the cases reviewed, "We found that only 4 of the 11 events involving Medicare hospital-acquired conditions could be identified through POA indicators contained in the billing data," the report said. "Among the seven hospital-acquired conditions found in the case study that POA did not flag, five had no related ... ICD-9-CM code in the hospital billing data."