risk management implications of “never events” june 2008 paula g. sanders, esquire partner post...
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Risk Management Implications of “Never Events”
June 2008
Paula G. Sanders, EsquirePartnerPost & Schell, PC
Risk Management Implications of “Never Events”
Paula G. Sanders, Esquire
Post & Schell, PC
17 North 2nd Street, 12th Floor
Harrisburg, PA 17101
717-612-6027
The “Never Event” Conundrum
Treatment Event
Documentation
Reimbursement impact & liability exposure
Physician/patient communication
Carrot or Stick?
• Pay for performance
• Quality initiatives: high quality, patient-centered and efficient
• Punitive measures?
• Payors move from passive to active purchasers of care
• “A joint effort between the healthcare provider and the coder is essential. . . The importance of consistent, complete documentation in the medical record cannot be overemphasized.”
(CMS Transmittal #1240 (May 11, 2007))
Historical Overview
• Reports of the Institute of Medicine (of the National Academy of Science)
– To Err is Human (1999)
• Up to 98,000 deaths occur annually as a result of medical error
– Crossing the Quality Chasm (2001)
• Addresses broad quality issues and establishes six aims of care: safe, effective, patient-centered, timely, efficient and equitable
Historical Overview
• Interests of federal and state payers, employers, commercial insurers and consumers in:
– Quality, safety and cost controls– Leads to ever evolving reimbursement
schemes designed to address these control issues
– Payment solutions to quality problems
Pay-for-Performance
• New Pay for Performance models
– At the federal and state level, models are being implemented in the hospital setting (movement from financial incentive for voluntary reporting to mandatory reporting, and finally, results- driven payments)
– CMS intends to implement appropriate like models in the physician setting as next step (physicians at financial incentive for voluntary reporting stage)
• Physician Quality Reporting Initiative started 2007
What’s in a Name?
• IPPS: inpatient prospective payment system
• MS-DRG: Medicare-Severity DRG
• CC/MCC: “complications & comorbidities” AND “major complications & comorbidities”
• POA: present on admission
• HAC: hospital-acquired condition
Present on Admission Indicators
• Y: Diagnosis present at time of inpatient admission
• N: Diagnosis not present at time of inpatient admission
• U: Documentation insufficient
• W: Condition is clinically undetermined
• 1: Code is not reported/not used and is exempt for POA reporting
Federal Mandate for “Never Events”
• Established by the Deficit Reduction Act, Section 5001(c), Medicare FY 2008 IPPS Final Rule
• Identifies “serious reportable events” or “never events”
• Must be reasonably preventable through the application of evidence-based guidelines
• No payment under a higher DRG despite services rendered if condition not Present On Admission (POA)
• Applies to 8 Hospital Acquired Conditions (HAC’s)
Medicare Never Events – Reasonably Preventable
• High cost, high volume, or both
• Assigned to a higher paying DRG when present as a secondary diagnosis
• Reasonably prevented through the application of evidence-based guidelines
• And acquired during hospitalization if not POA
Medicare is Not Alone• Several states no longer pay for “never events” or
preventable serious adverse events (PSAEs)– Pennsylvania has a no-payment policy for 28
PSAEs (copy attached as handout)– PA legislation to extend non-payment authority
to all health care payors passed by a vote of 201-2
• Commercial payors follow suit– 11/07: B/C B/S announces its plans to
implement nonpayment for “never events” – 1/08: Aetna announces it is incorporating
“never events” in its new hospital contract templates and follows Leapfrog recommendations (report, remediate, waive costs, apologize)
Medicare Never Events: 10/1/08
• Object left in surgery
• Air embolism
• Blood incompatibility
• Catheter-associated urinary tract infection
• Decubitus ulcers – stages 3 & 4
• Vascular catheter-associated infection
• Surgical site infection –mediastinitis after coronary surgery
• Falls – fractures, dislocations, intracranial injury
Proposed Never Events – Comments Due 6/13/08
• Surgical site infections following elective procedures
• Legionnaires’ Disease
• Glycemic control
• Iatrogenic pneumothorax
• Delirium
• Ventilator-associated pneumonia (VAP)
Proposed Never Events – Comments Due 6/13/08
• Deep vein thrombosis (DVT)/Pulmonary Embolism (PE)
• Staphylococcus aureus Septicemia
• Clostridium Difficile-Associated Disease (CDAD)
• Methicillin-Resistant Staphylococcus aureus (MRSA)
• Deletion of “N” & “U” POA indicators
Critical Elements
• Assessment and documentation of POA conditions (conditions existing at the time the order for inpatient admission occurs)– ED notes– Admitting note– H&P– Progress notes
• How can coders capture the POA indicators at time of admission?
Changing Practices
• Avoiding HAC’s:– Use of evidence based practice guidelines– Reliance on risk management best practices
• Goals: to identify patient risks, anticipate needs, and protect reimbursement
• Despite best efforts, it is inevitable that a patient may sustain a preventable injury
Disclosure
• Why disclose to the patient?– American College of Physicians Ethics Manual
(2005): “…physicians should disclose to patients information about procedural or judgment errors made in the course of care if such information is material to the patient's well-being. Errors do not necessarily constitute improper, negligent, or unethical behavior, but failure to disclose them may.”
Disclosure
• State law requirements to other agencies?
• State law requirements to patients?
• Other considerations?– Diffuses anger (no appearance of a cover-up)
• Explanation of benefits and patient notice– What will the EOB say about non-payment?
• Is risk management notified?
Disclosure or Apology?
• Patient Disclosure/Apology programs – Leapfrog Recommendations
• Report, remediate, waive costs, apologize
• Elements of disclosure– Explain what happened (to the extent known)– Say “I’m sorry” it happened (empathy)– Emphasize that you (and/or the institution)
take the matter seriously and will evaluate any and all steps necessary to avoid recurrence
– Communicate results
Disclosure or Apology?
• After initial disclosure– All care appropriate?
• Reinforce empathy and share basis for conclusion
– Below the standard of care?• Apologize and admit fault (take
responsibility)?• Discuss compensation?
• A better model?
Disclosure or Apology?
• What happens with the apology?– Limitation on admissibility of apologies
• 29 states have laws protecting a provider’s apology from being used as evidence or as an admission of liability in a lawsuit
– Admissions of fault are admissible as evidence
• Insurance ramifications– Coverage?– Duty to cooperate?
Liability Exposure
• “Never Events” and use at trial
• “Reasonably preventable through the application of evidence-based guidelines”
• May depend on state by state rulings – Negligence per se– Use of expert testimony
• If admitted, practical effect of shifting burden to defendants to show injury/outcome was not avoidable or does not reflect a departure from the standard of care
Criminal and/or Civil Exposure
• What is the liability for submitting a claim for payment of a “never event?”
• Recoupment or non-payment
• Potential false claims liability
• Repeated failures to identify POA
• Pattern of erroneous submissions
• Data matching between state and federal databases by Medicare Program Safeguard Contractors/RACs
• Maine prohibits knowing or willful submission of claims for payment (copy of law attached)
Overcome the Confusion
How Do You Break Down The Silos?
• Who is training about “never events” and POA?
• Are staff aware of “never event” consequences?
• If only the facility suffers a financial impact as a result of “never events,” how does a facility get staff buy-in and support?
• How best to integrate risk management, compliance, clinical teams -- nursing and physicians, utilization review, peer review, mandatory reporting, quality improvement, HR, coding, medical records and billing?
How Do You Break Down The Silos?
• How do you keep track of the different reporting requirements and definitions?
• Who is responsible for tracking?
• How do you handle potential whistleblowers?
Continuing Challenges
• How do you ensure consistency between all of the various reports and the medical record?
• Who reviews patient notifications, disclosures and apologies?
• What mechanisms are in place for capturing information on a timely basis?
• What are the consequences of submitting a claim for a never event?
• How do you make this an issue for your institution if it is not already looking at this?
• What happens to peer review and other privileges?
How Do You Foster a “Zero Tolerance” Environment?
• Review and revise job descriptions
• Develop and enforce more rigorous policies and procedures designed to increase accurate POA reporting and to eliminate “never events”
• Subject staff, including independent practitioners, to more rigorous scrutiny at time of appointment, reappointment, and as part of the ongoing peer review process
• Be more proactive in disciplinary and corrective action processes
How Do You Foster a “Zero Tolerance” Environment?
• Avoid cumbersome corrective action processes that are costly, lead to litigation, and result in NPDB reporting issues or staff reductions
• Review employee handbooks and codes of conduct
• Follow a “never event” through your health system from start to finish
• Educate and train
• Develop and continuously monitor and refine systems and fail-safes
How Do You Foster a “Zero Tolerance” Environment?
• Structure your “never events” initiatives through “informal” peer review processes that do not give rise to “formal” corrective action except in the most egregious cases
• Create structures for immediate physician feedback, “education” and “informal intervention” as opposed to formal corrective action
• Network and look for innovative models that might work for your institution– We are all in this together
Resources
• CMS fact sheets on hospital-acquired conditions and POA reporting: www.cms.hhs.gov/HospitalAcqCond/07_EducationalResources.asp
• CMS Proposal for Additional HACs: http://www.cms.hhs.gov/apps/media/press/factsheet.asp?Counter=3042&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOpt=0&srchData=&keywordType=All&chkNewsType=6&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date
• CMS Transmittal #1240 (May 11, 2007): http://www.cms.hhs.gov/Transmittals/downloads/R1240CP.pdf
Thank You