Healthcare Financial News

The Centers for Medicare and Medicaid Services (CMS) announced on July 31 its final acute care inpatient prospective payment system (IPPS) rule, which updates Medicare payments to hospitals for FY09 and includes payment provisions to reduce never events that occur in hospitals.

CMS’s action brings to 11 the number of never events for which it will not make additional payments, with the inclusion of the following:
* Surgical site infections following certain elective procedures, including certain orthopedic surgeries, and bariatric surgery for obesity
* Certain manifestations of poor control of blood sugar levels
* Deep vein thrombosis or pulmonary embolism following total knee replacement and hip replacement procedures

In addition to the final rule, CMS sent a letter to state Medicaid directors providing information about how states can adopt the same never events practices. The letter specifically encourages states to adopt the same nonpayment policies outlined in the final rule. Nearly 20 states already have or are considering methods to eliminate payment for some never events.

The final rule will appear in the Aug. 19, 2008, issue of the Federal Register, and will be effective for discharges on or after Oct. 1, 2008. It updates payment policies and rates for more than 3,500 hospitals that receive Medicare payment. Overall, the final rule is estimated to increase Medicare payments to acute care hospitals by nearly $4.75 billion. Read the press release.

Millions of dollars worth of Indian Health Service (IHS) property has been lost or stolen over the past several years, according to a Government Accountability Office (GAO) analysis of FY04-07 IHS property records, a physical inventory at IHS headquarters, and an inventory of IT equipment at seven IHS field locations in 2007 and 2008. GAO also examined IHS policies, conducted interviews with IHS officials, and assessed the security of property. The findings were reported in an issue brief released July 31.

IHS identified more than 5,000 lost or stolen property items, worth about $15.8 million, including all-terrain vehicles and tractors and a computer containing sensitive data such as Social Security numbers. GAO’s physical inventory identified more than 1,100 IT items, worth about $2 million, missing from IHS headquarters, including laptops and digital cameras. GAO also estimates that IHS had about 1,200 missing IT equipment items at seven field office locations worth approximately $2.6 million, representing about 17 percent of all IT equipment at these locations.

However, the dollar value of lost or stolen items and the extent of compromised data are unknown because IHS does not consistently document lost or stolen property, said the report. GAO identified that the loss, theft, and waste can be attributed to IHS’s weak internal control environment, allowing property management problems to continue for more than a decade with little or no improvement or accountability for lost and stolen property and compromise of sensitive personal data. Read the report.