Starting October 1, the Centers for Medicare & Medicaid Services (CMS) will cease paying hospitals for certain never events, and Blue Cross Blue Shield of Alabama will follow suit. Their list of 11 never events — or more suitably termed, serious preventable events — goes into effect the same day. “If you think about what’s right for patients, it’s hard not to say actions along these lines would not be appropriate,” said Keith Granger, CEO of Flowers Hospital in Dothan. “Physicians endorse the concept of never events in general, with the understanding that some events, like hospital acquired conditions, can never reach zero incidence,” said Pam Varner, MD, and president of the Medical Association of the State of Alabama (MASA). “All these things are usually a system issue, and every physician is for finding ways to avoid them.” Until now, payment from insurance providers and CMS has been tied to medical necessity and appropriate care, rather than accountability. However, because never events have not been reported, no statistics exist on them for Alabama. “This is not a data-driven decision, but a common sense one,” said Jim Brown of Blue Cross. “Not having statistics on infections doesn’t mean we’ve never met someone who’s had a staph infection.” Alabama Hospital Association (AlaHA) was not surprised by the move. “If you’re following industry trends, it’s one of those things you see coming,” said Granger, who also serves as chair of the AlaHA Quality Task Force, a committee of 50 hospital CEOs, quality directors, and physicians that has been working on quality issues for over three years. Since spring, they’ve worked with Blue Cross on compiling the list of serious preventable events. “This was a collaborative effort,” Brown said. “We wanted to be sure the process doesn’t interfere with patient care, but drives better attention to detail.” The group applied evidence-based guidelines to generate the list. Granger applauds this opportunity to build statewide standards. “We need more evidence-based practices statewide, so we can develop greater consistency.” He stated urinary catheter procedures as an example where “best” had not been clearly defined and standardized. “We need to get rid of ‘in my experience’ and ‘in my opinion’ and create industry standards we know work,” Granger said. “Physicians want to be part of any system that would prevent those events from happening. The issue is how to find the right way to do it,” Varner said. A Letter of Agreement with Blue Cross was due from participating hospitals on August 15. By signing the letter, the hospital agreed to identify the 11 events and not to bill for them. Lack of hospital participation is tied to reimbursements and benefit plans. “If there’s no signed agreement beginning in January 2009, they won’t get points for serious preventable events, which could effect their rating as part of Blue Cross’s tiering program. And we’ll probably have customers whose benefit plan will exclude coverage in those hospitals,” Brown said. Hospital employees appear to have a mix of enthusiasm and anxiety about the changes. “We’re hearing a variety of responses,” Granger said. “Many warmly embrace it and believe it’s the rational, ethical thing to do. But change by itself creates anxiety.” For physicians, Varner sees a potential rough start, as well. “There’s definitely going to be more protocols and rules. There will probably be over-reactions to start with, and then as people get more experience, the rules will adjust,” Varner said. The eleven events break down into two categories: three surgical never events, for which Blue Cross will not pay, and eight hospital-acquired conditions, which the hospital will review on a case-by-case basis. The hospital will not bill Blue Cross or the patient for any additional days resulting from one of these eight events. “The hospitals are paid for all the services performed in the appropriate way, but not for any extended services caused by an adverse result,” Granger said. Brown of Blue Cross added “There is no intention to eliminate coverage when the patient’s medical requirements are being met.” Blue Cross plans to expand the list to include applicable remaining items on the National Quality Forum list, as well as future CMS adopted events. “We fully expect it to expand beyond CMS’s list in the next 12 months, starting January 1, 2009,” Brown said. With consequences directed at the bottom line, the impetus for hospitals and staff turns toward prevention. “When these events happen, there are usually multiple places where the system broke down. We’re all for building protocols to prevent that,” Varner said. Brown said the policy serves as a flashing light, warning everyone involved to be cautious and clear, because these events should not ever happen. “It’s not designed to be punitive, but to prevent an occurrence,” Brown said. That’s why it’s important to get the list right, Granger said. “We’ve got to be careful that we develop this system to not expect more from a physician or hospital than they can be accountable for.” Granger also sees a need to build in rewards. “We need to ensure physicians and hospitals who are outstanding performers receive appropriate acknowledgement. That has to be an unfolding element in the future — that we move beyond what we want to avoid and provide incentives for what we want,” he said.