OIG report: Adverse events still too common, 'CMS expand HAC list'

'No turning back': More reporting requirements on horizon

The Centers for Medicare & Medicaid Services (CMS), on the march to value-based purchasing and tying quality care to reimbursement levels, certainly will be requiring more and more from hospitals. But a recent report from the Office of the Inspector General (OIG) makes it clear: CMS must not focus too narrowly on labeling adverse events or hospital-acquired conditions (HACs). In fact, the OIG recommends that CMS urgently strengthen its efforts to reduce harm and promote high-quality, safe patient care.

"There is no turning back the clock," says Katherine A. Kuchan, RN, attorney in the Milwaukee office of Hall, Render, Killian, Heath & Lyman PC. "Hospitals can't ignore the financial impact caused by adverse events. They're going to keep receiving scrutiny. There will be a higher level of scrutiny in the future, and hospitals need to make quality and reducing the incidence of especially preventable adverse events a priority."

In the report — "Adverse Events in Hospitals: National Incidence Among Medicare Beneficiaries" — released in November, the OIG reports results found in a study of "a nationally representative sample of 780 Medicare beneficiaries discharged during October 2008."

Physician reviewers looked at:

  • whether an adverse event had occurred;
  • whether the event was part of the National Quality Forum's (NQF's) Serious Reportable Events or Medicare's HAC list;
  • the level of harm to the patient;
  • whether the event was preventable.

OIG findings

Findings included:

• "An estimated 13.5% of hospitalized Medicare beneficiaries experienced adverse events during their hospital stay."

The OIG said that equates to an estimated 134,000 beneficiaries experiencing at least one adverse event in the one-month study. Of those: 0.6% experienced an event on the NQF list; 1% had a HAC event; and 13.1% had an adverse event that resulted in the "four most serious categories of patient harm," the report said. The report also said an estimated 1.5% of the patients studied experienced an event that contributed to death, equaling 15,000 patients in one month.

• "An additional 13.5% of Medicare beneficiaries experienced events during their hospital stays that resulted in temporary harm."

• "Physician reviewers determined that 44% of adverse and temporary harm events were clearly or likely preventable."

The report said those events relating to surgery or procedures "were less likely to be preventable than other types of events, such as hospital-acquired infections." Preventable events, the study found, were most commonly due to medical errors, substandard care, and lack of monitoring and assessment. Almost all the events listed by NQF or Medicare, the report said, were assessed as being preventable, noting that that was a key criterion for inclusion on those lists.

• "Hospital care associated with adverse and temporary harm events cost Medicare an estimated $324 million in October 2008."

(For more findings from the OIG report, see box below.)

Additional findings from OIG report

Additional findings from the Office of the Inspector General's report "Adverse Events in Hospitals: National Incidence Among Medicare Beneficiaries" include:

  • Inaccurate or incomplete data on present on admission indicators is a barrier to analysis, and "the accuracy and completeness of hospital coding on POA indicators have not yet been validated," the report stated.
  • For study purposes, events were classified as related to medication (31%), ongoing patient care (26%), surgery or other procedures (26%), and infection (15%).
  • Of 18 adverse events that reviewers found to cause serious disability or patient death, only two were on the National Quality Forum's list.
  • In four of nine HAC cases, diagnosis claims were used but not "the precise codes that CMS [the Centers for Medicare & Medicaid Services] uses to identify these HACs." Five claims had no diagnosis codes related to HACs. "Therefore," the report said, "the HACs were not identifiable through the claims data that CMS uses to implement the HAC policy."
  • The common cause for temporary harm was related to medication (42%).
  • Of those patients who experienced adverse or temporary harm events at hospitals covered under Medicare's inpatient prospective payment system, 84% did not incur additional care costs.
  • Sixty-five percent of the additional costs to Medicare ($210 million) resulted from entire, additional hospital stays "required to treat resulting from the adverse events."
  • In recommending that CMS more closely evaluate the Quality Assurance and Performance Improvement Condition of Participation in its surveys, OIG said this would encourage hospitals to adopt evidence-based practices.

OIG recommendations

The OIG's recommendations included asking:

  • the Agency for Healthcare Research and Quality (AHRQ) and CMS to "broaden patient safety efforts to include all types of adverse events," also asking CMS to use present on admission (POA) indicators in billing data to assess the frequency of adverse events;
  • CMS to provide more incentives for hospitals to reduce adverse events "through its payment and oversight functions," including expanding the HAC list and holding hospitals accountable for adopting evidence-based practice guidelines.

Experts comment

According to Matthew D. Vogelien, director, Huron Consulting Group in Chicago, the report "demonstrates the enhanced efforts to identify adverse events, prevent adverse events, and increase incentives to reduce those." While those will be the government's priorities, and subsequently yours, the report, he says, signals more aggressive oversight and reporting coming down the pike for hospitals.

"[T]here will be an increase in oversight. I think we'll see additional adverse events added to the lists that are out there in terms of what's considered an adverse or harmful event. And, we'll continue to see an increase in accountability. Ultimately, prevention of adverse events will really be critical to the bottom line, not only compliance with reporting requirements and accreditation, but the alignment of pay for performance and reimbursement from the government program is really going to have an impact on organizations if they don't have a good handle on that," he says.

Hospitals should tighten and shore up procedures surrounding adverse events now, he says. That, he says, includes two things: one, ensuring care is provided in the best manner to prevent events from happening; and two, having the reporting in place and "proactive reviews of medical records to understand the incidents" when they do occur.

If you haven't gotten it by now, Vogelien says the priority for hospitals should be to "prepare for even more activity in this area in the coming years, considering the attention that is focused on it through reform and the initiatives of the government agencies." And that includes not only federal bodies, but states.

Many states have adopted NQF's list for reporting requirements. And many others are adding requirements. "Many of our clients are focused on protocols and due diligence to ensure that they are identifying and reporting any potential adverse or harmful event so that they don't face exposure should an audit be conducted or someone come in retrospectively to look at their records and find incidents that weren't reported," says Vogelien.

He says it would be useful to review the report for any specific events or areas that show up as resulting in harm for possible measures to come and to perhaps start to look at those when you're reviewing charts or nurse protocols, for instance.

Kuchan, too, says hospitals should use the report as a road map of where to focus. For instance, start with those preventable events, pointing out that the report identifies that half of preventable events involved medicine, patient care, and infection. Surgery and other procedures showed fewer preventable events. Look at the tables and findings in the report and try to budget for an infrastructure including some of those, she says, as well as resources for outcome-based research.

Kuchan points to another interesting finding in the report — that among hospitalized patients when one adverse event occurs, 20% of those patients had at least one, if not more, additional unrelated adverse events. "So is there some kind of cascade phenomenon that's out there?" she says.

The report, indeed, said: "Most of the beneficiaries who experienced multiple events had two events, but others had as many as three unrelated events in the same hospitalization."

Henry C. Fader, corporate and health care partner with Pepper Hamilton LLP in Philadelphia, says the OIG focused quite a bit in the report on prevention, and the enforcement arm is looking for an "expanded definition of adverse events as opposed to things that could have been prevented. So that most health care organizations, and your readership, are not prepared to fight the battles that they need to to accurately report this."

He says there often is confusion among his clients about what needs to be reported to the state or federal agencies, what is a sentinel event, etc. "And, of course, the real concern that they have is the potential for liability for litigation. And there is a concern that the people who have that information will not be held to a privileged, peer review protection, and thus, will be discovered and be the subject of a lawsuit."

Fader says many states have adopted apology laws. It's a verbal, not a documented, process in which the hospital can provide full disclosure and that conversation cannot be admitted in a lawsuit.

What does the OIG's work plan for 2011 share with its November report? In its work plan, Fader says, the OIG is "definitely going to look at...hospital admissions with conditions coded present on admission, early implementation of Medicare's policy of hospital-acquired conditions, responses to adverse events in hospital by Medicare's oversight entities, and hospital reporting for adverse events."

The point, he says, is the OIG is "hitting this area very hard."

Only the beginning

Most experts Hospital Peer Review spoke with agree that it's only the beginning of the pay-for-performance era, and that most hospitals haven't yet felt financial repercussions from HAC findings.

"With my clients, I definitely see the devotion and resources...in terms of documentation — ensuring documentation, training the workforce," says Karl A. Thallner, partner at Reed Smith LLP in Philadelphia.

The hospitals that can demonstrate quality and efficiency are going to be the successful ones down the road, he says. "So even though maybe today the impact of this isn't all that great, the writing is on the wall in terms of where the Medicare programs is going, and, therefore, the investment the hospital makes in this area is something you're going to have do sooner or later. You might as well get started."

He suggests hospitals home in on the list of conditions that affect payment already. A system that "systematically fails to note present on admission in order to avoid payment adjustment due to a hospital-acquired condition, that's certainly False Claims ammunition for sure."

(To view the entire OIG report, visit http://oig.hhs.gov/oei/reports/oei-06-09-00090.pdf.)