Patient Protection and Affordable Care Act Provider-Preventable Conditions

1. Patient Protection and Affordable Care ActProvider-Preventable Conditions Division of Health Care Financing & Policy

2. The Concept • Public programs should not pay for treating a health problem arising out of a patient’s care at a facility if the secondary problem could reasonably have been avoided • Eliminating payment for poor quality care will improve patient safety • Cost savings is a secondary driver • If policies are expanded beyond serious adverse events, cost savings could be significant

3. Provider Preventable Conditions …new terms in the payment dictionary PPCs are based on Medicare nonpayment policies and include two distinct categories of conditions. OPPCs apply broadly to inpatient and outpatient settings and include three “never events.” States can identify other OPPCs for non-payment. HACs are identified from Medicare regulations and apply to all inpatient hospital settings

4. Conditions – Never Events • Surgical or other invasive procedure to treat a particular medical condition when the practitioner erroneously performs: • A different procedure altogether • The correct procedure but on the wrong body part • The correct procedure but on the wrong patient

5. Conditions – Hospital Acquired Conditions (HACs) Foreign object retained after surgery Air embolism Blood incompatibility Stage III and IV pressure ulcers Falls and trauma Manifestations of poor glycemic control Catheter-associated urinary tract infection Vascular catheter-associated infection Surgical site infection following identified procedures Deep vein thrombosis/pulmonary embolism

6. PPC Compliance Summary

7. DHCFP Proposed Plan Address baseline compliance (no state-identified PPCs) Ensure compliance and policy consistency with MCOs Phase in 4 stages: Prior Authorization Retrospective Review HP System Edits Implementation of provider self-reporting with implementation of 5010 of X12 standards for HIPAA transactions

8. DHCFP Proposed Plan • Prior Authorization (Stage 1) • HP manually screens PAs for PPCs • Approves (includes payments to secondary providers treating PPCs caused by primary providers) • Denies via new PPC denial code All cases are referred to Surveillance and Utilization Review (SURS) for further review In Process

9. DHCFP Proposed Plan • SURS retrospective review (Stage 2) • Using PA information • Using potential PPCs Identified by UNLV/CHIA

10. Retrospective Review Joseph Greenway, MPH Center for Health Information Analysis

11. Retrospective Review • Potential PPCs Identified by UNLV/CHIA Annually (concurrent with Medicaid HAC Reporting) • CHIA Identifies possible PPCs • Sends letter to each facility identifying possible PPCs • Facility given 30 days to review/respond • Possible PPC list modified • CHIA reports PPCs to DHCFP • DHCFP adjusts payment as regulation requires

12. Payment Reduction Guidelines • No reduction when the condition defined as a PPC existed prior to initiation of treatment for the patient • “Reductions in provider payment may be limited to the extent that the identified PPC would otherwise result in an increase in payment; and that the State can reasonably isolate for nonpayment the portion of the payment directly related to treatment for, and related to, the PPC”

13. Payment Adjustment Options • Per-Diem Denial • Deny per-diem for additional days associated with a PPC using national standards • Payment adjustment using 3M software

14. Payment Adjustment – 3M • Apply APR DRG grouper to every Medicaid claim • Using POA flag, software identifies all potential PPCs • Software creates payment weight for each claim (comparing claims with and without the presence of that PPC) • Payment adjustment calculated using payment weight times base Medicaid rate

15. DHCFP Proposed Plan Discussion • Identifying PPCs • Retrospective review using UNLV/CHIA data • Payment Adjustments • Per-diem denial • 3M methodology for reduction of a portion of costs