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Medicare and a Never-Event Involving a Patient Transfer Case

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Medicare and a Never-Event Involving a Patient Transfer Case

Week #7 Application

MMHA-6205: Health Law and Ethics

August 19, 2013

Who would have imaged the Centers for Medicare & Medicaid Services’ (CMS) initiative would increase the exposure risk to both physician and health care facility alike because of the term “never events”. Never events are inexcusable medical errors that should never occur; the initial list of 28 events defined as “adverse events that are serious, largely preventable, and of concern to both the public and health care providers for the purpose of public accountability” was compiled by the National Quality Forum in 2001 (Sohn, 2011); pressure ulcers or bedsores was included on the initial list. As for the increased risk exposure for physicians/health care facility, it comes in two forms, the risk of; not being reimbursement by the government and other health care providers; unknowingly file a claim for payment to the government as a result of a never event, as well as; increased medical liability along with the added expense of defensive medicine, which cost the US on average approximately $89 billion per year.
CMS (the Centers for Medicare & Medicaid Services is a federal agency within the US Department of Health and Human Services that administers the Medicare program and works in partnership with state governments to administer Medicaid and other health related insurance programs (Tavenner, 2011)) “never event” to raise awareness of preventable errors that should never have happen and to save the government money by declaring that expenses associated with treating the never event will not be paid for by Medicare or Medicaid (Sohn, 2011).
For physicians/health care facilities, the strict liability standards for reimbursement of never events has led to stricter standards for medical liability along with an increase in risk exposure, as a result of the guidelines set forth by the CMS use of a strict liability posture to deny payments, the same posture is being used by the plaintiff’s attorneys to argue that the treating physician/health care facility was at fault per se; note, the CMS makes these decisions without any proof of negligence (Sohn, 2011).

Pressure Ulcers/Bedsore
Pressure ulcers or bedsores are injuries to the skin and underlying tissues that result from prolonged pressure on the skin; often develop on the shin that covers the bony areas of the body, such as the heels, ankles, hips or buttocks. People who are at risk of pressure ulcers are those with a medical condition that limits their ability to change positions, requires them to use a wheelchair and/or confines them to abed for prolonged periods; which can develop quickly and are often difficult to treat (Mayo Clinic Staff, 2011). Categorized as a deep tissue injury, the symptoms of a pressure ulcer are skin red in color that gets worse over time in an area that can form a blister or even an open sore; this area can be sore, firm, mushy, boggy, warmer, and/or cooler compared to nearby tissue. These sores generally fall into four groups based on their severity; stage I is the earliest sign of a developing pressure ulcer, while; stage IV is the worst, at this point there is usually bone and muscle damage. It should be noted that neither the case description nor the CMS has stated level of damage that be the bases for denying payment.

Action Needed
The hospital and the skilled nursing facility have both enjoyed a profitable relationship by referring admissions and services to each other; the admission of this Medicare patient should have been routine. As an administrator, charged with knowing all of the federal, state and local guidelines; based on the definition of a pressure sore, or lack thereof, and; the lack of have proof of negligence; by filing a claim for reimbursement, the hospital can in all likelihood be seen as committing fraud. In order to prevent this from occurring, the hospital’s administrator should in place a corporate compliance program, an inter-hospital patient transfer policy as well as clarification of the 28 never events and the degree in which there are grounds for non-reimbursement.
A corporate compliance program is the legal equivalent to preventive medicine. These programs along with planning, organization, and commitment, can spot problems early and allow an organization to take corrective action in order to avoid government fines and penalties; this is an essential business function for avoiding the risk of liability (FTLF, 2013), as well as serving as an umbrella for all facilities doing business with hospital including the skilled nursing facility. Instead of pointing fingers, the two parties should be working together to find a solution for their mutual patient contracting pressure sores and the hospital thereby receives its reimbursement.
At this point, the hospital should in place an appropriate patient policy in place to prevent and foresee any problems like the one in this case. This policy should reflect the optimal health and well-being of the patient being transferred while establishing a qualified physician and/or personnel responsible for accepting the patient, administering a medical screening examination and reviewing pertinent medical records before receiving and accepting the patient into the facility.
The administrator should also be fully aware of qui tam relator under the False Claims Act (31 U.S.C Sections 3729-33) allows a private individual or “whistleblower”, with knowledge of a past or present fraud on the federal government, to sue on behalf of the government to recover stiff civil penalties and triple damages; also prohibits an employer from harassing or retaliating against an employee for attempting to uncover or report fraud on the federal government; person bring the suit is called the Relator (QTON, 2012).

Reimbursement Policy
In a desire to reduce the deficit, President Bush signed into law the Deficit Reduction Act of 2005 which contained language creating a system for quality adjustment of Medicare payments for impatient hospital services. The law required the secretary of Health and Human Services to identify at least two hospital-acquired conditions (they chose 28 in all) that could have been reasonably avoided through the application of evidence based guidelines and would be subject to the adjustment in payment. There are three criteria’s for payment adjustment, which states that the condition; must be associated with a high cost of treatment or high occurrence rate within hospital settings; results in higher payment to the facility when submitted as a secondary diagnosis, and; can reasonably be prevented by adoption and implementation of evidence-based guidelines. For the administrator, the procedure making adjustments in payments and/or non-payment in not written in stone, the can give the administrator the opportunity to negotiate with the CMS on a case by case basis (, 2013).
Initially, I believe the creation of the never event program served its intended purpose; to raise awareness of preventable errors that should never have happen; while the potential saving generated by the program never occurred because of the high cost associated with medical liability/defense.

To deal with this and future problems, the hospital administration should extend its corporate compliance program and patient transfer policy along with any notes that pertains to providing quality health care to the skilled nursing facility and their other health care partners.
Pozgar, G. (2010). Legal and ethical issues for health professionals (2nd ed). Sudbury, MA: Jones & Bartlett
Sohn, D.H., JD, MD (2011). The American Academy of Othropaedic Surgeons: Update on “never events”;
Blankenship, C., Esq (2008). Non-Payment of Never Events: Implications for Practice;
Mayo Clinic staff (2011). Bedsores (pressure sores): (2009). American College of Emergency Physicians: Appropriate Interhospital Patient Transfer;
FTLF (2013). Health Care Corporate Compliance;
OTON (2013). Qui Tam Online Network: What is the False Claims Act? ;

NCSL (2013). National Conference of State Legislatures: Medicare Nonpayment for Hospital Acquired Conditions;

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