My Policy Hub

Improving health is our policy

ACA Now

2702 - Payment Adjustment for Health Care-Acquired Conditions

 
Implementation Status 
Statutory Text 

Summary

Directs HHS to identify current state-level practices that prohibit payment for health care-acquired conditions (HACs) and to incorporate any applicable practices into a forthcoming mandated Medicaid regulation that is due to take effect by July 1, 2011.  Specifically, the regulation is to prohibit Medicaid payment to states for amounts expended on care stemming from HACs.  Also requires HHS to take into consideration the HACs identified under the Medicare program in developing this regulation applicable to Medicaid.

Last updated: (May 9, 2016)  #Hospitals, #Quality

Implementation Status

 
Summary 
Statutory Text 

To view the CMS webpage dedicated to this topic, which contains a consolidated listing of guidance released to date, visit here.

CMS, in the summer of 2011, issued a final rule effectuating this policy change, though said it would “delay compliance action” on the rule’s provisions until July 1, 2012 (as opposed to July 1, 2011, as called for under the ACA).  Note that prior to the release of the 2011 final regulation, CMS in 2010 published guidance regarding a state survey on HACs pursuant to this provision.  Note also collaborative use of ACA funds by the CDC to enhance states’ ability to prevent healthcare-associated infections (HAIs) as denoted here.

On a related note, on Dec. 2, HHS released a report (see press release) finding that current efforts to improve patient safety and reduce avoidable medical errors have saved an estimated 50,000 lives and reduced medical spending by roughly $12 billion. Noting that hospital-acquired conditions (HACs) have fallen 17 percent between 2010 and 2013, the report explained that cumulatively, “1.3 million fewer HACs were experienced by hospital patients over the 3 years (2011, 2012, 2013) relative to the number of HACs that would have occurred if rates had remained steady at the 2010 level.” Though HHS touted a wide range of quality initiatives – including provisions under the ACA and Medicare payment incentives – the report notes that “the precise causes of the decline in patient harm are not fully understood.”

On Apr. 25, CMS released an extensive final rule on Medicaid and CHIP managed care (press release; add’l fact sheets available here under “final rule”) that seeks to acknowledge increased enrollment in managed care delivery systems and – to facilitate beneficiaries’ transitions and care management across product lines – promote cross-market alignment with Marketplace Qualified Health Plans (QHPs) and Medicare Advantage (MA). The final rule addresses these provisions of the ACA.

Statutory Text

 
Implementation Status 
Summary 

SEC. 2702 [42 U.S.C. 1396b–1]. PAYMENT ADJUSTMENT FOR HEALTH CARE-ACQUIRED CONDITIONS. (a) IN GENERAL.—The Secretary of Health and Human Services (in this subsection referred to as the ‘‘Secretary’’) shall identify current State practices that prohibit payment for health care-acquired conditions and shall incorporate the practices identified, or elements of such practices, which the Secretary determines appropriate for application to the Medicaid program in regulations. Such regulations shall be effective as of July 1, 2011, and shall prohibit payments to States under section 1903 of the Social Security Act for any amounts expended for providing medical assistance for health care-acquired conditions specified in the regulations. The regulations shall ensure that the prohibition on payment for health care-acquired conditions shall not result in a loss of access to care or services for Medicaid beneficiaries. (b) HEALTH CARE-ACQUIRED CONDITION.—In this section. the term ‘‘health care-acquired condition’’ means a medical condition for which an individual was diagnosed that could be identified by a secondary diagnostic code described in section 1886(d)(4)(D)(iv) of the Social Security Act (42 U.S.C. 1395ww(d)(4)(D)(iv)). (c) MEDICARE PROVISIONS.—In carrying out this section, the Secretary shall apply to State plans (or waivers) under title XIX of the Social Security Act the regulations promulgated pursuant to section 1886(d)(4)(D) of such Act (42 U.S.C. 1395ww(d)(4)(D)) relating to the prohibition of payments based on the presence of a secondary diagnosis code specified by the Secretary in such regulations, as appropriate for the Medicaid program. The Secretary may exclude certain conditions identified under title XVIII of the Social Security Act for non-payment under title XIX of such Act when the Secretary finds the inclusion of such conditions to be inapplicable to beneficiaries under title XIX.

Contact Us

Impact Health Policy Partners 1301 K Street, NW, Suite 300W
Washington, D.C. 20005

(202) 309-0796
Contact Us

Follow Us On