Study: Medicare has saved virtually nothing through non-payment policy

In theory, Medicare hoped to both improve care and save significant amounts of money on needless illnesses when it instituted a policy of not paying for six hospital-acquired conditions. In reality, however, the policy has had little financial impact, according to a new study published in Health Affairs.

Since 2008, when Medicare first stopped reimbursing hospitals for certain avoidable conditions, Medicare has saved only $1.1 million nationwide, or about 0.001 percent. (I'd imagine Medicare has spent a lot more searching for cases in which the non-payment policies applied!)

To examine the results of Medicare's policy, researchers looked at 2006 California data on six of the avoidable conditions. They found that while hospital-acquired conditions were present in 0.11 percent of acute inpatient Medicare discharges, only 3 percent of that group fell under Medicare's restrictions.

Given these results, the authors recommend expanding the Medicare policy to rule out payment for consequences of such conditions, added procedures or readmissions.

To learn more about this study:
- read this HFMA News item