Medicare Penalties: Trying to stop hospital infections

Medicare levies penalties against hospitals in an effort to reduce the number of infections patients pick up at these facilities.

Jenna Flannigan is a senior editor at and a freelance writer. This story was produced as a project for the California Health Journalism Fellowship, a program of the USC Annenberg School for Communication and Journalism.

Other stories in this series include:

Medicare penalties take heavier toll on hospitals with the most vulnerable patients

Medicare Penalties: What causes hospital readmissions?

Medicare Penalties: The search for value-based care

Hospitals are not always the safest places for people who are sick.

Roughly 10 percent of patients admitted to a hospital experience a serious medical complication — like an infection or injury — related to their care.

“We need to stop the proliferation of hospital-acquired conditions,” Suzanne Mattei, Esq., founder and executive director of patient advocacy group New Yorkers for Family & Patient Empowerment, told Healthline. “People shouldn't be afraid to go to the hospital.”

That fear is something Lori Finkel understands.

Nine years ago, a surgeon accidentally nicked Finkel’s bowel while removing a large, benign cyst. Finkel returned home, but three days later she was back in surgery.

A foot of her colon and part of her abdominal wall were removed to clear an infection that turned out to be necrotizing fasciitis, commonly known as “flesh-eating” bacteria.

“It was extremely frightening, like an out-of-body experience,” Finkel said, recalling the nervous faces of hospital staff before she went back to the operating room.

She recovered but still has serious digestive problems related to the injury.

The Push to Reduce Mistakes

Medicare is pushing hospitals to prevent surgical errors, like the one Finkel experienced, through its Hospital-Acquired Condition (HAC) Reduction program.

It is one of three programs created under the Affordable Care Act to penalize hospitals that don’t perform well on certain quality measures.

More than 3,000 hospitals are subject to the HAC program. The quarter of hospitals with the highest rates of certain medical complications and infections receive a 1 percent penalty on their Medicare payments for in-patient care.

However, experts note that the HAC program will work to protect patients only if it uses the right quality metrics to assess hospitals—and some are concerned that the current metrics might be flawed.

A new study in The Journal of the American Medical Association suggests that some hospitals may be unfairly penalized under the program.

It found that hospitals that scored the best on a summary of quality measures—which differed from those used by Medicare—were penalized at five times the rate of hospitals that scored the worst.

“Hospitals that are larger, care for sicker and more complex patient populations, are teaching institutions, and have more quality accreditations were disproportionately penalized by the HAC program,” Dr. Ravi Rajaram, a researcher at Northwestern University Feinberg School of Medicine who coauthored the study, told Healthline.

He noted that hospitals that care for poorer patients were also more likely to face penalties.

Penalized for Finding Errors

On its surface, the HAC program might give the impression that these hospitals offer worse care, Rajaram said. But the real problem could be how Medicare assesses them.

Echoing doubts raised by others, the study authors note that hospitals that are best at catching some types of medical complications may be the most likely to be penalized.

This is known as “surveillance bias.” It essentially means that the more you look for something, the more often you find it.

That’s an issue with several of the measures used in the HAC program, according to Rajaram.

As an example, he described a medical complication in which blood clots form in the large veins following surgery. Such blood clots can kill patients, but they can also go away on their own.


In some hospitals, all patients undergoing certain surgeries are screened preventively for blood clots — even if they have no symptoms — just to be on the safe side.

Those screening practices may help save lives — but they could also disadvantage a hospital in the HAC program.

Rajaram explained, “The hospitals that were the most attuned and most aggressive about trying to pick up these blood clots were also the ones that had the worst performance [on that metric].”

The blood clots metric was questionable enough for U.S. News & World Report to stop using it in its hospital quality rankings. But it’s still used in two of Medicare’s penalty programs, including the HAC program.

“Are the metrics that are embedded in these programs perfect? Absolutely not,” Dr. Christopher Cargile, chief medical quality officer at UAMS Medical Center, told Healthline. “Are some of them really on target? Absolutely.”

Using Penalties as an Incentive

UAMS Medical Center is the largest teaching hospital in Arkansas. It’s also one of more than 700 hospitals that received a HAC penalty in 2015.

Cargile’s team focuses on increasing quality of care and patient safety. He said that Medicare’s metrics have been useful for improving quality and creating a culture of safety at UAMS. The hospital expects to avoid a HAC penalty in 2016.

Rajaram also noted that the idea behind the HAC program — pushing hospitals to improve safety with financial incentives — made a lot of sense to him. But, he said, “The concern is doing it in a way that’s equitable and fair across hospitals.”

Both Rajaram and Cargile said that they would like to see Medicare become more responsive to research that identifies issues in the HAC program’s metrics.

While patient advocacy groups have praised Medicare’s efforts to improve hospital safety, Mattei didn’t dismiss the concerns raised by researchers like Rajaram. She noted that interventions to improve quality can sometimes create the appearance of a worsening problem because hospital staff are looking for it.

This can happen with bed sores, she said. “You’ll see an increase, but it’s due to greater prevention.”

In general, Medicare is moving in the right direction with quality improvement programs, Mattei said. “We know that hospitals can reduce error and infection rates. We have to take strong actions.”

[This story was originally published by Healthline News.]