CMS proposes no-pay rules for 3 surgical errors

Washington -- The Centers for Medicare & Medicaid Services on Dec. 2 proposed three national coverage determinations that would end Medicare pay for surgeries involving any of three major errors.

Physician and hospital organizations generally agree that these errors -- surgery on the wrong patient, surgery on the wrong body part, or the wrong surgery -- should never happen. But they say CMS' definitions of these events leave too much room for interpretation about the scope of the rules.

If the determinations become final, the government would instruct all Medicare contractors to follow the no-pay policy. It would not end pay for procedures determined to be medically necessary after surgery has begun. CMS is soliciting input on exactly how far the policy would reach.

The agency in late July indicated it would issue these Medicare coverage rules separately from a list of 10 hospital-acquired conditions for which Medicare would no longer pay at a higher diagnosis-related group rate. Medicare stopped paying hospitals the higher amount for those conditions, including catheter-associated urinary tract infections, foreign objects retained after surgery and blood incompatibility, starting Oct. 1.

By using the national coverage determination process, the no-pay rule for the three surgical errors would affect all professionals who file Medicare claims, not just hospitals. Contractors have had the flexibility to develop their own coverage decisions in this area, and agency spokeswoman Ellen B. Griffith said most if not all contractors probably already refuse to pay physicians or hospitals for surgeries involving these errors.

"What we're looking for here is uniformity in terms of the national policy," Griffith said. CMS does not have statistics on how often these errors happen.

Few, if any, hospitals seek payment for surgeries with these errors, said Nancy Foster, vice president for quality and patient safety policy for the American Hospital Assn. "It's hard to find fault in Medicare wanting to make explicit the fact they don't expect to pay for such events."

The AHA has encouraged hospitals to consider not seeking pay for services involving the National Quality Forum's full list of 28 serious reportable events, but the association has not made this a national policy, Foster said.

Unanswered questions

The American Medical Association supports improving quality, safety and efficiency for patients by developing systems and tools to prevent errors from occurring. However, CMS should not use the national coverage determination process to implement this Medicare pay policy, according to an Aug. 27 letter to CMS from AMA Executive Vice President and CEO Michael D. Maves, MD, MBA. "The issue at question is not whether surgical procedures will be covered by the Medicare program, but rather under what circumstances the payment for covered surgical procedures will be denied or reduced.

"It would make more sense to develop a clear payment policy outlining the circumstances under which surgery claims would not be payable by Medicare," Dr. Maves wrote. "CMS could, for example, instruct Medicare carriers to deny payment claims for these major surgical errors if a physician failed to use commonly accepted patient safety practices."

CMS must be sure to articulate these rules clearly, Foster said. For example, should an anesthesiologist who participates in a surgery involving one of these three errors also lose pay even if that person made no error? "I'm not sure I know how to draw the right line between those that should have payment affected and those who shouldn't," she said.

Likewise, two of the three surgical errors in the proposed determinations have a scope that could prove to be a bit fuzzy, said Elizabeth W. Hoy, assistant director for regulatory affairs and quality improvement programs for the American College of Surgeons. Operating on the wrong patient is a clearly definable error, but "wrong procedure or wrong body part does get a little trickier," she said.

Would Medicare, Hoy asked, not pay for surgeries on certain patients -- such as the morbidly obese -- for whom it can be difficult to determine the exact site requiring a procedure?

CMS is seeking input on these issues, said Griffith, the agency spokeswoman. "Those are questions that ought to be addressed in comments to the national coverage determinations," she said. The public has until Jan. 1, 2009, to submit comments.

Hoy suggested CMS should work with physicians who follow quality standards and use safeguards. "Somewhere there has got to be some accommodation for people who are doing everything right and something still happens."