New York Medicaid Payment Reforms

The New York State Medicaid program announced on June 5 that it will stop reimbursing hospitals as of October 1, 2008 for the costs of treating certain preventable conditions that patients did not have upon admission.  New York selected 14 conditions that were reliably identifiable, preventable through proper inpatient care, and serious in consequences for the patient.  The hospitals will not be allowed to bill the Medicaid program or the patients for the extra costs of such complications.  Hospitals will be required to report conditions that were present upon admission and discharge so that conditions acquired during the inpatient stay can be identified.  New York’s action follows similar Medicare rules that CMS proposed on April 14 which would eliminate payment upgrades under DRGs split into subgroups for complications where the complications very likely resulted from medical errors or inadequate care that occurred in the hospital.  CMS and New York Medicaid data suggest that these payment reforms may spur internal hospital quality assurance efforts, save lives, and reduce costs.  PCG will encourage clients to consider similar payment reforms.        

 

Tom Entrikin

Tom Entrikin is a PCG manager and former Medicaid policy specialist with the U.S. Health Care Financing Administration (HCFA), now the Centers for Medicare & Medicaid Services (CMS).