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Abstract:

Recent Medicare legislation has been directed at improving patient care quality and cutting costs by stopping reimbursement of healthcare-associated conditions (HACs). However, recent evidence suggests that the policy has not been effective in reducing HACs. We study national trends of two particular HACs, central line-associated bloodstream infections (CLABSIs) and catheter-associated urinary tract infections (CAUTIs). We find sharp differences in HAC reporting rates for hospitals in states that had strong regulations on adverse event reporting prior to the Medicare legislation. In particular, our results suggest that hospitals in states without prior regulations may be engaging in "upcoding", a practice where hospitals report HACs as being present-on-admission, resulting in greater reimbursement. Our findings have important implications for future legislation: we hypothesize that the upcoming HAC Reduction Program starting in 2015 may also not be effective at reducing HACs, and may unfairly punish more truthful hospitals if proper incentives for discouraging upcoding are not implemented.

Based on joint work with Hamsa Bastani, Joel Goh, and Stefanos Zenios