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No reimbursement for hospital medical errors

Health Factors: Quality of Care
Decision Makers: State Government Healthcare Professionals & Advocates
Evidence Rating: Insufficient Evidence
Population Reach: 10-19% of WI's population
Impact on Disparities: No impact on disparities likely

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Recently, the Centers for Medicare and Medicaid Services (CMS) ceased paying hospitals for some of the care made necessary by “preventable complications,” conditions that result from medical errors or improper care and that can reasonably be expected to be averted.

Expected Beneficial Outcomes

Reduced hospital errors
Increased performance measurement

Evidence of Effectiveness

Rosenthal 2007 indicates that the Centers for Medicare and Medicaid Services’ (CMS’) decision to cease paying hospitals for some care necessitated by “preventable complications” will result in hospitals receiving reduced payment for the care of individual patients with preventable complications but is unlikely to change the total Medicare payments to hospitals substantially. The article indicates that this policy may lead to more wide-spread adoption of quality measurement and reporting or to improved targeting of prophylaxis for community-acquired infections as hospitals will have to ascertain and code infections and other conditions as “present on admission” to avoid revenue reductions.


United States

The Federal Centers for Medicare and Medicaid Services (CMS) will not pay for some “never events.” Aetna and Blue Cross Blue Shield halted reimbursement for hospital care resulting from serious medical errors. There is some further enactment in this regard in Pennsylvania, Minnesota, Washington, and Massachusetts.


In June 2008, the Wisconsin Medical Society (WMS) and the Wisconsin Hospital Association (WHA) jointly endorsed a set of nine adverse events for hospital non-billing, encouraging purchasers and payers to support this effort. As well, several Wisconsin health plans are adding CMS’ list of adverse events for non-billing to their hospital contracts. WMS has activated a physician advisory group to study impact on physician care and reimbursement.

Citations - Evidence

Rosenthal 2007 - Rosenthal MB. Nonpayment for performance? Medicare’s new reimbursement rule. New England Journal of Medicine. 2007;357(16):1573-5. Accessed on November 9, 2015

Page Last Updated

January 1, 2011