Summary
1) Payment reductions for medical errors will not change provider behavior. 2) Reduced payments to providers could accelerate medical errors.
Analysis
It has been a long standing principle of HCFA/CMS that errors in providing care constitute substandard care, and should not be paid for. The elimination of payment for cases were medical errors occurred is a continuation of this policy, or is it another attempt to reduce payments to providers and slow the erosion of the Medicare trust funds?
A payment "bonus" means that if you meet certain criteria, you get to keep your full Medicare payment, otherwise we will reduce your Medicare payments for failure to meet criteria. Medicare's Pay for Performance initiative falls into the last category.
If CMS is intent on reducing errors in hospitals, they can do the following: 1) Pay providers an amount that keeps pace with inflation and removes pressures to cost-shift to other payers. Such payments will help providers retain adequate staffing ratios. 2) Consider adding capital payments to providers for instituting tools that help lower error rates; tools like bedside medication verification systems and computerized physician order entry systems. 3) Each regulation or payment change from CMS carries an administrative burden (or so it seems) which pull provider resources away from patient care and into regulatory or payment compliance. Each time CMS wants to make a change in provider behavior, they need to add to provider payments to keep the shift from patient care resources from taking place.
The real problem in the industry is the demographics are stacked against the fiscal realities. One economists involved in Hillary Clinton's health security task force of the early 90's stated "you cannot sufficiently suspend the laws of economics to solve both the health care price and health care access problems simultaneous." As long as we try to do both in this country, there will be continual symptoms of a growing fatal disease that has infected the health care industry. Medical errors is one of those symptoms.
