Do Medicare's financial penalties to improve care actually work?

The Medicare program has financially penalized hospitals for years for not preventing avoidable injuries to patients while they're hospitalized, but it is hard to determine whether that program has had a concrete impact. commentator Peter Ubel, M.D., noted that when the Medicare program first started penalizing hospitals for patient falls, injuries and pressure sores, it implemented such penalties all at once. The agency didn't conduct trials at random individual hospitals in order to gather precise data on whether the penalities made a difference in outcomes. "So any change in hospital quality that has occurred since 2008 can't necessarily be attributed to the program," Ubel argued.

The costs for not reducing such incidents can be high. Hospitals in Florida, for example, face annual Medicare penalties of as much as $300 million for not curbing preventable infections. There are also concerns as to whether hospitals actually report such preventable issues at all. The Wall Street Journal recently reported that up to 40 percent of providers, including hospitals, may be docked up to 1.5 percent of their overall Medicare payments for not submitting required data.

Nonetheless, he did note some dramatic improvements, such as in the sharp decline in the number of catheter-related urinary tract infections and venous central line infections. But there was no such downward trend for incidents such as injurious falls or pressure sores, although both actually dropped, according to the charts Ubel compiled.

"At a minimum, we did not see any kind of backfire, whereby the policy led to an increase in any of these complications," Ubel wrote, but added that "hospitals might focus so much on preventing these kinds of complications that people would do a worse job of preventing other kinds of complications."

To learn more:
- read the Forbes article 
- check out the Wall Street Journal article