Compliance Mentor - November 2015

Hospital Access Management - Hospital Case Management - Hospital Employee Health
Hospital Infection Control - Hospital Peer Review - Healthcare Risk Management
Case Management Advisor - IRB Advisor - Medical Ethics Advisor - Same-Day Surgery

Medication Errors, Adverse Drug Events Occur in Half of All Surgeries

Medication errors are the most common type of medical errors. A recent study found that medication errors and adverse drug events occurred in about half of all surgeries. This was the first study to look into the incidence of medication errors in the perioperative period. This study occurred at the Massachusetts General Hospital, which is considered one of the best hospitals in the country. It’s a 1,046-bed, tertiary care academic teaching hospital in Boston. Anesthesiologists and CRNAs conducted the study over an eight-month period.

Researchers observed 277 surgeries and witnessed 3,671 medication errors, or one in every 20 administrations. There were 193 observed errors, which is about 50% of all surgeries. About 80% of the errors, or 153 errors, were preventable. Two-thirds of the medication errors were serious and 2% were life threatening. Fortunately, none resulted in any patient deaths, even though three were classified as being potentially fatal.

One patient with a known penicillin allergy developed a rash after taking a similar drug. Another patient’s blood pressure dropped significantly, but the anesthesiologist and nurses failed to act. A nurse incorrectly set up an IV drip that was going wide open. There were many errors related to the wrong dose or an omitted dose. Surgeries lasting more than six hours resulted in a higher rate of error. One reason may be the hectic nature of the operating rooms where there may not be time to perform double checks.

Another observation was the failure to document the medication error. The CMS hospital CoPs requires that all medication errors be documented in the medical record, which must include a notation that shows a physician was made aware.

Resources:

Evaluation of Perioperative Medication Errors and Adverse Drug Events; Karen C. Nanji, M.D., M.P.H.; Amit Patel, M.D., M.P.H.; Sofia Shaikh, B.Sc.; Diane L. Seger, R.Ph.; David W. Bates, M.D., M.Sc., AnesthesiologyNewly Published on 10 2015.

“Study finds medication errors, adverse drug events in 1 out of 2 surgeries studied” Oct. 25, 2015.

Related [Live Webinar] December 2: Uncovering Patient Safety and the 'Just Culture' Theory

Related [Live Webinar] December 3: Prevention and Management of an OR Fire

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Hospital Must Give Observation Patients a Written Notice under the Notice Act

President Obama recently signed the Notice Law, or H.R. 876, also known as the Notice of Observation Treatment and Implication for Care Eligibility Act.

Hospitals, including critical access hospitals, will now have to give each patient a written notice when they receive observation services for more than 24 hours. The notice must be provided before discharge and no later than 36 hours after observation begins. It must explain implications, such as cost sharing and information for subsequent eligibility, and that the beneficiary is an observation outpatient, not an inpatient. The patient must sign it. If the patient refuses to sign it then the staff member who presents it can sign a certification that the notice was presented along with the date and time.

Observations do not count for the three qualifying stays for Medicare reimbursement for skilled nursing care. Sometimes, patients were not aware of this. For example, a patient arrived at the hospital and was placed in an outpatient observation bed. The next day she was changed to inpatient admission status. She was then sent to a skilled nursing bed. She was in the hospital three days, but since one of these was an observation day, Medicare did not pay her $54,000 skilled nursing home bill. The new law wants to make sure patients understand the difference.

It can also affect their out-of-pocket expenses. In general, Part A requires patients who are admitted as an inpatient to pay a deductible, which was $1,260 in CY2015.Observation is an outpatient status and the Medicare beneficiary pays 20% of the Medicare reimbursement amount for outpatient items and services after paying the annual Part B deductible, which was $147 in CY2015. The beneficiary could potentially have greater cost-sharing liability as an observation patient. In 2012, the OIG said that in 6% of the observation stays the beneficiary paid more than the inpatient deductible. Hospitals may request patients who consult their physicians while in the hospital be classified as an inpatient.

Here is a copy of the law.

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What Hospitalists Need to Know About Two-Midnight Rule Changes

CMS recently posted changes to the Two-Midnight Rule. The final rule on this will be published in the Federal Register on Nov. 13. The Two-Midnight Rule initially required the physician to sign a certification declaring that an inpatient was expected to stay at least two midnights. Besides the supporting documentation for admission, an order to admit the patient as an inpatient was required. The presumption was that the stay would be paid as an inpatient under Medicare Part A. Otherwise, the stay would be considered to be treated and billed as an outpatient observation patient under Part B. This rule has never been popular with hospitals and has created some problems in its application. CMS was concerned about the increase in short stay admissions. The effect of this rule for many hospitals was to increase the number of observation patients.

The 2016 inpatient perspective payment system rules did not contain any radical changes. CMS asked for input from the provider community regarding payment for short inpatient stays under Part A payment. There is fundamentally no difference in the care of outpatient observation patients and inpatients. The two-midnight rule also specified that the treatment decisions were to be based on the medical judgment of the physicians or other qualified practitioners.

CMS used the Recovery Audit Contractors (RACs) to identify high rates of errors to determine if hospital services were medically necessary. This included the distinction between inpatients and outpatients. In the proposed 2016 outpatient PPS rules, CMS announced a change in the enforcement of the two-might rule. The Quality Improvement Organizations (QIOs) will oversee the majority of patient status audits. The RACs will on focus on those hospitals with consistently high denial rates.

CMS announced that for stays expected to last fewer than two midnights, and stays not listed on the inpatient-only list, an inpatient admission would be paid under Medicare Part A on a case-by-case basis on the judgment of the attending physician. There would be no change to cases where the patient is expected to stay at least two midnights or longer. This includes if the patient later turns out to be discharged earlier than anticipated due to unforeseen circumstances. This could include transfer, death, a patient left against medical advice, or unexpected clinical improvement.

CMS made the announcement as it finalized Medicare payments to physicians and hospitals. It clarifies when inpatient admissions are appropriate to be paid under Medicare Part A. It continues the importance of physicians’ judgment regarding if the patient needs to be admitted as an inpatient or based in an outpatient observation bed. The portion regarding how patients are expected to stay more than two midnights is unchanged and will be paid under Medicare Part A. Patients who are admitted and expected to stay fewer than two midnights will be payable under Part A on a case-by-case basis as determined by the judgment of the physician. CMS said it is unlikely that patients will be admitted after minor surgical procedures and if the patient only stays for a few hours before discharge.

CMS also says it is providing a more collaborative approach to education and enforcement as discussed in the 2016 OPPS rules. In 2016, the Beneficiary and Family Centered Care QIOs will conduct the initial medical reviews claims for short-stay inpatient admissions. CMS also changed the time for the look-back period from three years to six months. CMS says it made this decision to address the concerns of hospitals that argued if the admission was not going to be billed under Part A they did have enough time to rebill it under Part B. The RACs must also complete any reviews within 30 days or they will lose their contingency fees.

Read the Two-Midnight Rule fact sheet here.

Read the final rule in calendar year (CY) 2016 Hospital Outpatient Prospective Payment System (OPPS) here.

The Oct. 30 CMS release with the rule changes is here.

Related [On-Demand Webinar]: Making the Two-Midnight Rule Work for You

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Revised CMS CoP Manual Addresses Spousal Rights for Same-sex Couples

CMS recently revised its 510-page hospital condition of participation (CoP) manual, also referred to as the State Operations Manual. Any hospital that accepts Medicare payments must be in compliance with the CoP manual.

This is the third time this year it has been updated. The last update, which occurred in July, included the 41 pages of completely rewritten standards for radiology and nuclear medicine.

CMS issued a 10-page survey memo on Dec. 12, 2014. That same day, a 6-page document in the Federal Register was published. It recognized the rights of spouses in legally valid same-sex marriages. The hospital had to honor the same-sex partner as a spouse if they were legally married in any state. This was true even if that state did not recognize same-sex marriages. This provided equal rights to the spouse in same-sex marriages, regardless of where the couple resided. In June, the Supreme Court ruled same-sex marriages legal.

Page 37 of the new manual says that whenever the word “spouse” is used in the hospital CoPs, it means an individual who is married to another as a result of a lawful marriage. This includes same sex-marriages and is true regardless of where the marriage occurred.

CMS provides guidance about when to treat an individual as the patient’s representative. CMS says that if the state law specifies a procedure for determining who may be considered to be the incapacitated patient’s representative, then the hospital follows the state law. Otherwise, CMS sets out information on how to proceed. Representatives could include parents who make decisions for their minor children, guardians appointed by the probate court, patient advocates or support persons, and durable powers of attorney. CMS says that the hospital, when discussing the spouse, must also recognize legally married same-sex partners as spouses. Also, CMS says the hospital is required to recognize same-sex partners who are legally married, regardless of any state laws.

The current CMS hospital manual is available here. Click on Appendix A.

Related [On-Demand Webinar]: Advance Directives Update: What Every Healthcare Provider Should Know

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Hospital Pays a Hefty Fine in Excessive Compensation for Referrals Case

The Office of Inspector General issued a fraud alert memo recently that says physician compensation arrangements can result in significant liability. This includes hospitals that enter into contract with physicians for medical directorships that do not reflect fair market value.

This could violate the anti-kickback law if the reason is to compensate physicians for past or future referrals. The government is taking very seriously Stark cases under the False Claims Act (FCA) that cover triple damages. Whistleblowers are now more aware of settlements.

A federal judge has ordered Tuomey Healthcare System to pay approximately $237 million in fines after finding a violation of the FCA. Several groups told the hospital they were planning on performing surgical procedures in their offices instead of the hospital. The hospital was concerned about the reduction in surgical case volumes, so it employed 19 specialists as part-time employees. Physicians were required to perform the procedures in the hospital and their base salaries were based on the hospital’s net collection for outpatient procedures. One physician who did not receive a contract filed a qui tam lawsuit, alleging that the hospital paid the physicians above market value. Judge Albert Diaz, who upheld the verdict against the hospital, said:

“It seems as if, even for well-intentioned healthcare providers, the Stark law has become a booby trap rigged with strict liability and potentially ruinous exposure — especially when coupled with the False Claims Act.”

In a surprising move, Tuomey agreed to settle with the government for $72.4 million, which is less than one-third of the $237 million that a federal appeals court said it would have to pay for illegal compensation arrangements with doctors. The hospital has already lost three times in federal court. Tuomey agreed to be sold to Palmetto Health as part of the settlement.

Settlements in September doubled the settlement record in consecutive weeks. On Sept. 15, North Broward Hospital District agreed to pay $69.5 million to settle allegations that it paid doctors far more than fair market value based, in part, on its referral. Then on Sept. 21, Adventist Health System paid the government $115 million to settle allegations it offered doctors excessive compensation for referrals. These cases should be a wakeup call for compliance officers and hospitals. Boards should also be briefed on these cases. All hospitals should review their physician contracts for legal compliance. Contracts with employed physicians should be consistent with fair market value and should not take into consideration the value or volume of referrals the employed physician can bring to the table. The hospital should not base any of the employed physician’s compensation of the expected value of business the physician will refer to the hospital.

The time is also ripe to review the compliance program as a whole. Hospitals should ensure that compliance officers are qualified and competent.

To see a copy of the June OIG’s Fraud Alert “Physician Compensation Arrangements May Result in Significant Liability” go to http://oig.hhs.gov/compliance/alerts/guidance/index.asp.

To see a copy of the 46-page corporate integrity agreement between the OIG and North Broward Hospital District go here.

Here is information on Tuomey and the Department of Justice website. The case is captioned United States ex rel. Drakeford v. Tuomey Healthcare System, Inc., Case No. 3:05-cv-02858 (MBS) (D.S.C.).

To read information on Adventist settlement, go here.

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Past Editions of Compliance Mentor Available Online

reliasmedia.com now contains past editions of Compliance Mentor, which debuted in April. The publication includes new regulations and revisions to the CMS hospital conditions of participation, accreditation organization changes, and other issues involving regulations and compliance. Past editions can be found here.

Readers are encouraged to forward this edition to friends and colleagues who may be interested. Compliance Mentor is read by more than 62,000 subscribers.

There are three additional complimentary publications. ED Push discusses issues in emergency medicine and has been published since October 2014. It is published twice a month. Hospital Consult has been published since November 2014 and is of interest to administration, nursing, and clinical staff. The September 2015 edition includes articles on the effect of noise in hospitals, nursing, bullying, and violence. It discusses the American Nurses Association position statement on violence. OSHA recently announced that it will be focusing on work place violence in hospitals under the general duty clause. This edition discussed how failure to follow guidelines on placement of arterial catheters can increase arterial catheter infections. CMS requires hospitals to follow standards of practice. An example would be the CDC Guidelines for the Prevention of Intravascular Catheters.

The final complimentary publication is The Vitals. It has been published monthly since November 2014. This publication covers clinical issues of interest to healthcare facilities. Past editions have discussed issues such as medical legal actions and male physicians, medical board certification, chronic pain patients, and electronic reminders to increase Tdap boosters. On a side note, the CMS infection control worksheet for hospitals, section 1.D.14, requires the hospital to provide Tdap to all personnel who have not previously received it. After receipt of Tdap, healthcare personnel would receive Td (tetanus diphtheria) for future booster vaccinations.

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