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THE NATIONAL QUALITY FORUM was the first to create a list of Serious Reportable Events, which are now commonly referred to as “never events.” California followed suit, creating its own list of Reportable Adverse Events. The two lists are nearly identical, with two exceptions. In 2006, the NQF added artificial insemination with the wrong donor sperm or wrong egg to the list—California has not yet adopted this event. California does, however, include an event that is not on the NQF list: “An adverse event or series of adverse events that cause the death or serious disability of a patient, personnel or visitor.”
Surgical
1. Surgery performed on the wrong body part
2. Surgery performed on the wrong patient
3. Wrong surgical procedure performed on a patient
4. Unintended retention of a foreign object in a patient after surgery or other procedure
5. Intraoperative or immediately postoperative death in an ASA Class I patient
Product or Device
6. Patient death or serious disability associated with the use of contaminated drugs, devices, or biologics provided by the health care facility
7. Patient death or serious disability associated with the use or function of a device in patient care in which the device is used or functions other than as intended
8. Patient death or serious disability associated with intravascular air embolism that occurs while being cared for in a health care facility
Patient Protection
9. Infant discharged to the wrong person
10. Patient death or serious disability associated with patient elopement (disappearance)
11. Patient suicide, or attempted suicide, resulting in serious disability while being cared for in a health care facility
Care Management
12. Patient death or serious disability associated with a medication error (for example, errors involving the wrong drug, wrong dose, wrong patient, wrong time, wrong rate, wrong preparation, or wrong route of administration)
13. Patient death or serious disability associated with a hemolytic reaction due to the administration of ABO/HLA-incompatible blood or blood products
14. Maternal death or serious disability associated with labor or delivery in a low-risk pregnancy while being cared for in a health care facility
15. Patient death or serious disability associated with hypoglycemia, the onset of which occurs while the patient is being cared for in a health care facility
16. Death or serious disability (kernicterus) associated with failure to identify and treat hyperbilirubinemia in neonates
17. Stage 3 or 4 pressure ulcers acquired after admission to a health care facility
18. Patient death or serious disability due to spinal manipulative therapy
19. Artificial insemination with the wrong donor sperm or wrong egg
Environmental
20. Patient death or serious disability associated with an electric shock while being cared for in a health care facility
21. Any incident in which a line designated for oxygen or other gas to be delivered to a patient contains the wrong gas or is contaminated by toxic substances
22. Patient death or serious disability associated with a burn incurred from any source while being cared for in a health care facility
23. Patient death or serious disability associated with a fall while being cared for in a health care facility
24. Patient death or serious disability associated with the use of restraints or bedrails while being cared for in a health care facility
Criminal
25. Any instance of care ordered by or provided by someone impersonating a physician, nurse, pharmacist, or other licensed health care provider
27. Sexual assault on a patient within or on the grounds of a health care facility
28. Death or significant injury of a patient or staff member resulting from a physical assault that occurs within or on the grounds of a health care facility
As every doctor knows, these nightmares are extremely rare and unlikely. But what about a patient becoming injured from a physical assault on hospital grounds? Or breaking a hip at the hospital after falling out of bed? Those are uncomfortably more plausible. And along with about two dozen other horrible health care scenarios, they comprise a growing list of “never events” for which many hospitals can no longer get paid, and for which new sorts of reporting requirements are springing up in California and the United States as a whole.
Since their impact has so far been limited to hospitals, few doctors have paid attention to what’s going on with never events. But it’s a good idea to start. The patient safety movement that created this new category of outcomes is hoping to change the way hospital medicine works, and that may filter down to physicians individually, through hospital policies or even through medical malpractice law.
The general public surely includes individuals who have an impulse to apply non-payment policies to doctors, although the advocates of never-event policies swear that they aim only to change the system, not to create a scapegoat. As the situation exists today, insurers increasingly won’t pay hospitals for a procedure causing a never event, and California requires medical facilities to report them, as do most states. While these reports don’t aim to implicate individual physicians, medical liability experts still recommend that doctors be sure that the reports don’t unfairly reflect doctors’ roles. And while never events don’t have any definition important to civil or criminal law, the mere existence of such a category can help plaintiff’s attorneys.
Terminology is a problem when discussing never events. While these negative health outcomes are conceptually similar, there is no generally accepted umbrella term. The National Quality Forum, which promotes “health care quality” and reporting, assembled the first list of 27 “serious reportable events” in 2002. That list grew to 28 never events in 2006. Medicare will not pay for 11 “hospital-acquired conditions,” eight of which appear on the NQF list. California requires hospitals to report 27 “adverse events,” from the NQF’s list. Where possible, we specify which group’s definition is under discussion, but we use the unfortunate term “never event” as a catchall.
Looking to Blame
There might be some confusion in the public mind about what it means when Medicare announces, as it did last October, that it will no longer pay for never events. A host of other payers, including Anthem Blue Cross and Aetna, followed suit with their own version of this negative pay-for-performance system to influence provider behavior. Sometimes these moves feed a reflexive need to blame doctors, who are the most easily imagined source of medical errors.
Days after Medicare’s change, the New York Times penned an extraordinary editorial revealing a two-dimensional understanding of how hospitals work, and a strange need to accuse physicians for all errors. “The most important benefit will come if the new rules persuade hospitals to work harder to prevent errors and protect their patients,” said the Times. “The policy focuses exclusively on hospitals, as directed by Congress, and lets doctors off scot-free. If surgeons leave a sponge or an instrument in a patient and have to operate again to retrieve it, the hospital will not be paid for the second operation, but the surgeons will.”
It’s not clear how common that kind of scapegoating is. But there doesn’t seem to be any movement to punish individual physicians yet. Outwardly, at least, all the major parties in the patient safety movement—including large insurance-buying employers, patient advocacy groups and health policy groups—seem to understand that it takes a lot of mistakes from a lot of people to produce most never events. So far, they’ve remained focused on the system. So have the insurers who already do not pay hospitals for never events. Similarly, the Joint Commission strongly recommends that hospitals report their never events, but only if they do not identify medical staff.
Minnesota’s HealthPartners, the state’s third-largest health plan, became the first to stop paying for never events in 2005. After the state passed a law requiring hospitals to report them, HealthPartners amended their contracts to stop hospitals from billing for the errors. “We do not include physician services in there, and the reason is that we thought it was too complicated,” says HealthPartners spokeswoman Patricia Lund. With multiple providers and visits, that kind of policy would’ve been too difficult to enforce, “and the purpose isn’t to be punitive, but to send a signal,” she says. Like other payers, the company’s plan is the flip side of a pay-for-performance system.
As a consortium of large, insurance-buying employers, the National Business Group on Health is one of the big forces promoting the never-events policies, including non-payment. Asked whether she’d seen any movement to expand non-payment beyond hospitals to individual physicians or medical groups, NBGH President Helen Darling says, “I don’t see any evidence for that—I think we’ve got more than enough problems to address in the hospital.” Enforcement would be a nightmare, too. Most of the process and structural requirements that keep never events from happening are under the purview of the hospital. “You have to assume that human beings will be human beings—who will get busy and distracted—and you have to set up systems that keep checking and counter-checking,” she says.
Never Events and the Law
Assemblyman Mike Feuer (D-Los Angeles) introduced legislation in the state Capitol this year that would call for state health programs, such as Healthy Families, to adopt Medicare’s non-payment policies for hospitals and surgical clinics involved in “substantiated” adverse events on the agency’s list of 11 “hospital-acquired conditions.” It would authorize private payers to do the same thing. California already requires hospitals to report 27 adverse events to the State Department of Public Health within five days, and the bill proposes to add eight new reportable events to that list. The bill’s reporting requirement for surgical clinics is new.
Feuer’s bill would also require the department’s licensing and certification division to confidentially collect event information, including patient names, to provide it to state health programs, such as the State Department of Health Care Services and the Managed Risk Medical Insurance Board. The department is also obligated to investigate within two days, if it seems that a health facility presents an ongoing danger.
Unlike Feuer’s similar, unsuccessful effort last year, AB 542 does not apply to individual physicians. After his office amended the current bill, the California Medical Association changed its stance from opposition to official neutrality. The original version applied non-payment to all of California’s 27 adverse events, provided they were “substantiated,” rather than Medicare’s list of 11 conditions, as it does now. The bill still doesn’t describe in detail how an adverse event should be substantiated, and the association holds that its methodology needs to reflect Medicare’s approach. Additionally, the CMA would like to strengthen its provisions for keeping patient and physician information confidential to avoid the threat of litigation that could chill reporting.
Under current California law, hospitals that fail to report one of the state’s 27 adverse events are subject to civil penalties. Hospitals must also report “unusual occurrences” that threaten the welfare, safety or health of patients and others. The department will inspect a reporting hospital, and if it’s not satisfied that the hospital has resolved its problem, inspectors come back unannounced within a year. The CMA opposed this law on the grounds that it defined “medical error” too vaguely, and that hospitals should report voluntarily and anonymously to a non-regulatory organization. There might be disincentives to reporting to regulatory agencies, argues the CMA, and could hamper efforts to understand the prevalence of these adverse events and to change procedures in order to stop them from happening.
Beginning this year, hospitals must also have a patient-safety plan in place that is built in cooperation with its health care staff. This includes developing a reporting system for patient safety events—including reportable adverse events—and an investigation process for discovering their root causes.
On the federal level, the Patient Safety and Quality Improvement Act of 2005 asks hospitals, physicians and others to voluntarily report medical errors and “near misses” to carefully defined patient safety organizations, such as the California Hospital Patient Safety Organization or Lumetra. Individually and through shared databases, the PSOs use that data to figure out how errors happen and how hospitals can fix them.
When hospitals turn information over to a PSO, it cannot then be used against hospitals or doctors in nearly any criminal, civil or administrative procedures, including disciplinary procedures. The law also allows providers to report patient safety data without the permission of patients, since reporting is considered a HIPPA-defined health care operation.
But as CMA On-Call Document 1530 notes, there is an exception. This kind of information can be released if a court decides in a criminal proceeding that it contains evidence of a criminal act, is material to a case, and is not available elsewhere. (See the On-Call document for the list of non-adversarial circumstances in which patient safety data can be released, such as its use in research.)
What Happens If It Happens
It’s a very remote possibility, but what if a never event happens? The ideals of professional pride, leadership and responsibility that thrive in health care can lead to the inevitable conclusion that blame is properly pinned on physicians. It’s not just uninvolved physicians who can get to thinking this way, it’s everyone, including staff and the involved physicians themselves.
As the story goes, the patient safety movement turned to the field of aviation when it needed a model for how to create a safer system within a culture of strict hierarchy. Just as in accidents involving airplanes, hospital never events require mistakes on several levels, not just from the person in charge.
By and large, hospitals are careful to train their staff on proper disclosure procedures, to investigate events, and to quickly identify those qualifying as serious reportable events. If an event qualifies, then most—if not all—hospitals disclose that fact to the patient or the patient’s family right away. While once it was dicey to offer acknowledgement that something bad has happened, the universal view of patient safety groups is that it can comfort patients and families, keep them from seeing providers as adversaries, and increase their estimation of the value of care. Counseling is often available for patients and families, while debriefings can help physicians and other staff to deal with what’s often a traumatic issue.
Legal and Reporting Issues
Never events weren’t imagined as a new category of outcomes with which to punish doctors. And so far, there has not been a push to make physicians involved with a never event pay an extra price, legally or financially speaking. But there is some concern within the House of Medicine that it might happen anyway. For example, the AMA News editorial board argued in July against Medicare’s use of the term “never events” while the agency was planning to extend its no-pay list. The term, it says, could add to doctors’ liability risks by fostering the notion that the outcomes should literally never occur, while many of them are difficult to avoid in high-risk patients.
Any threat to doctors would presumably come from medical malpractice lawsuits. The insurers at the Cooperative of American Physicians certainly deal with lawsuits stemming from outcomes that the NQF would call “never events,” but the law treats them just like any comparable outcome, says Waldene Drake, the group’s vice president of risk management and patient safety. But she wouldn’t be surprised if a plaintiff’s attorneys bring up federal and state never-event policies in a courtroom, in order to inflame a jury against a physician.
As with any serious negative medical outcome, being involved in a never event can become an economic disaster for providers who don’t take the right steps from the beginning. Drake says CAP recommends that its physician members make sure their hospitals have policies in place to inform doctors when it reports medical outcomes involving their patient to the state. “They want to make sure that they have some input, so that when a report is written, it’s not slanted against them,” she adds.
At Hoag Hospital, involved physicians know right away when an event is going to be reported. The hospital also acknowledges the event to patients and families. “By reporting you’re not saying it’s the physician’s fault or not,” cautions Jack Cox, MD, Hoag’s chief quality officer. “Under the clear definitions given by the state, you’re saying you think that you have an event that might fit one of these categories, and it’s the responsibility of the state to investigate it.” When it looks like one of these events has happened, Hoag assembles its “Never 28 Team” of seven hospital officers, including Dr. Cox, which investigates and votes on whether the event qualifies as reportable. If the event seems severe enough, they’ll call a meeting with the nurses and doctors involved, to determine what failed at a systems perspective. But Dr. Cox concedes that if, for example, a surgeon refuses to take a time-out, the hospital then has “an accountability issue,” but he calls that “rare, rare, rare.”
As with other serious medical outcomes, providers involved in a reportable event should immediately request a hearing in front of the hospital’s disciplinary committee, says Mike Khouri, an Irvine attorney specializing in professional board defense and fraud defense. In California and other states, the provider is entitled to such a hearing before a hospital can report to a licensing or regulatory agency, such as the California Department of Public Health.
Should the hospital report a serious event to the Medical Board of California, which it may be required to do, the board must review the event and determine whether to take disciplinary action against a provider’s license. “Obviously, whatever provider is implicated, they should consult their lawyer, and one that’s familiar with practicing in front of the licensing boards,” says Khouri.
He also recommends getting representation if the hospital reports to Medicare or the state Department of Health Care Services, which administers Medi-Cal. Within a hospital’s administrative review process, a lawyer can insist that proceedings follow proper procedure, which is a lot more useful than it sounds. “Lots of times, insisting on appropriate procedure is as effective as defending a case on its merits,” Khouri says.
When hospitals report to Medicare or the DHCS, those agencies can begin their own investigation if they determine that a quality-of-care issue is implicated. This can lead to disciplinary action against the provider’s Medi-Cal or Medicare number, which affects their ability to bill those programs. It can get really dicey at this point, since many hospitals require staff to have a discipline-free license and a Medi-Cal or Medicare provider number. “So, these types of things can wind their way down to the hospital taking action against a provider to terminate their staff privileges,” Khouri says. Moreover, the fine print of physicians’ agreements with health plans, such as Blue Cross, Blue Shield, and HealthNet, often contain a clause allowing the company to terminate preferred provider status if a license has been disciplined, or if a Medicare or Medi-Cal provider number has been revoked.
The Question of Cost
Certainly there is some evidence that cost savings might play a role in these policies. Back when it announced its payment changes, Medicare estimated that the new policy would save the mammoth program perhaps $21 million a year. “Other payers, both public and private, are beginning to adopt similar policies in their payment systems,” said CMS Acting Administrator Kerry Weems in a 2008 press release. “This is a win-win situation: better outcomes at less overall cost.”
If you take for granted that never events are truly avoidable, their costs to are huge. For example, a 2003 report in the Journal of the American Medical Association found that 18 “serious reportable adverse events” cost all payers a total of $9.3 billion in excess charges. On a more specific level, one estimate for malpractice lawsuits involving wrong-site surgery says that damages often run up to six and seven figures across the U.S.
For hospital acquired infections, which appear on Medicare’s no-pay list but not the NQF list, the difference in total hospital-stay charges for a patient with a hospital acquired infection versus a patient without one is huge, notes Helen Darling, National Business Group on Health president. Even before Medicare stopped paying, hospitals weren’t breaking even on some of these infections—a 2006 study by Richard Shannon, vice chairman of the University of Pennsylvania Department of Medicine, estimated an average loss of $26,839 for each patient suffering a central line-associated bloodstream infection. The overall annual national cost in 2002 dollars is $6.7 billion, according to a widely cited estimate by William Martone, MD, a longtime investigator of hospital-acquired infections and current executive director of Cubist Pharmaceuticals.
But the conclusion that costs are driving the non-payment policies of individual health plans can be a difficult to back up. Medicare’s estimated $21 million annual savings are a drop in the budket compared to its 2007 budget of $432 billion, the most recent numbers available. Minnesota’s HealthPartners, the first U.S. payer to stop such reimbursements, says that with 154 never events for 9 million patients, they are simply too rare for the policy to save much money. Moreover, the company pays for follow-up care after certain never events, including when foreign objects are discovered in the patient’s body after surgery. “If we really wanted to save money, we’d ask the hospital to pay for the follow-up care,” says spokesperson Patricia Lund.
Cost savings was certainly on the agenda of the National Business Group on Health, but initially that did not include non-payment. The group worked for years to change hospital policies toward greater patient safety, but with too little to show for its efforts, says Darling. As a result, the NBGH redirected its efforts toward non-payment policies. “Not having a club, if you will, wasn’t working,” she says.
Also, it might be that payers are taking advantage of the momentum and popularity of the patient safety and health care quality movements. But many of the prime actors behind never-event reporting see little or no financial gain from incremental savings. For example, the National Quality Forum, which focuses on health care quality measurement and reporting, and put together the original list of never events, is composed of hundreds of groups including the American Medical Association and Kaiser Permanente. The Leapfrog Group is probably closer to having a financial stake, since its members are big insurance-buying employers, but even then, their payoff would be highly indirect and perhaps non-existent. Leapfrog’s support for non-payment is best seen as a larger part of the group’s overall enthusiasm for “quality”-related incentives.
But are hospitals likely to spend a lot of time and money to prove some of the non-paying events aren’t their fault? For example, will hospitals test every new patient for MRSA, knowing that Medicare won’t pay the hospital if the infection shows up? Any resulting testing wave could be enormous.
That probably won’t happen, says Dr. Cox, Hoag Hospital’s chief quality officer. The evidence doesn’t show a huge benefit to testing all patients going into surgery, he says. “This is speculation, but I don’t know that we’re going to be any worse off with the defensive medicine that we’re practicing right now in a lot of physicians’ offices.”
As for hospitals spending a lot to protect themselves from non-payment from other never events, Minnesota Hospital Association President Lawrence Massa is doubtful. Since his state was the first to experience non-payment for never events, he would probably have noticed. “The change in behavior that has taken place has been a focus on creating a culture of safety and improving systems, and not necessarily on trying to avoid blame—the prevention part, that’s just part of the work that we do,” he says. “I don’t think it’s increasing costs in any specific way.”
The End Goal
It probably comes as no surprise to most physicians that the phenomenon of payers reimbursing a little bit extra for certain services now includes payers refusing to reimburse for certain mistakes. The payment-for-outcomes model does not have to dominate, but at the moment it’s certainly gaining ground, with state laws, regulatory policies and public and private companies eagerly joining in.
If it is truly aimed at improving health care, it should not create a new retributive mechanism aimed at doctors. Fortunately, that doesn’t seem to be the case right now, but the sentiments that might fuel it are out there. The California Medical Association already helped to defeat a never-event non-payment bill out of concern that it could target providers other than hospitals, and with a strong, organized medical community, it should be able to keep doing it.
