CurrentUniversity Health Alliance (HSA)Policy MPP-0021-120301
Reimbursement exclusions for never events and hospital-acquired conditions
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This policy governs University Health Alliance (UHA/HSA) reimbursement practices for participating acute care inpatient hospitals when care involves never events, hospital-acquired conditions (HACs), and serious medical errors; it affects inpatient hospital billing and related provider reimbursement.
Policy Summary
PayerUniversity Health Alliance (HSA)
PolicyReimbursement exclusions for never events and hospital-acquired conditions
Policy CodePolicy MPP-0021-120301
Change TypeTechnical/administrative (no material clinical changes)
Effective DateJun 26, 2024
Last ReviewJun 26, 2024
Next Review Date
Key ActionParticipating acute care facilities must populate Present on Admission (POA) indicators on all inpatient claims; claims with incorrect or missing POA may be returned, denied, or result in reduced payment.
SourceLink
POLICY UPDATE CHANGES
No material clinical or coverage changes in this revision.
14CMS HAC categories referenced
3Never events listed
837IClaims format for POA
06/26/2024Effective date
Reimbursement Exclusions for Never Events and HACs
Coverage criteria for never events and HACs
UHA will not provide additional payment or will deny reimbursement for inpatient services related to specified never events and hospital-acquired conditions unless the condition was present on admission or documented exceptions apply.
ALL of the following
ONE of
- Surgery performed on the wrong body part
- Surgery performed on the wrong patient
- Wrong surgical procedure performed on a patient
- Action: No reimbursement to hospitals for complications related to these never events; UHA will not reimburse surgeons who file claims for these events; physicians must hold members harmless for services related to these events.
ALL of the following
ONE of the CMS-listed HAC categories
- Foreign object retained after surgery or other procedure
- Patient death or serious disability associated with intravascular air embolism occurring in the facility
- Patient death or serious disability associated with a hemolytic reaction due to administration of ABO/HLA incompatible blood or blood products
- Stage 3, stage 4 or unstageable pressure ulcers acquired after admission to a healthcare facility
- Falls and trauma (including fractures, dislocations, intracranial injuries, crushing injuries, burns, other injuries)
- Manifestations of poor glycemic control with onset while in the facility
- Catheter-associated urinary tract infection (CAUTI)
- Vascular catheter-associated infection
- Surgical site infection — mediastinitis following CABG
- Surgical site infection following bariatric surgery for obesity
- Surgical site infection following certain orthopedic procedures (spine, neck, shoulder, elbow)
- Surgical site infection following cardiac implantable electronic device (CIED)
- Deep vein thrombosis (DVT) or pulmonary embolism (PE) following certain orthopedic procedures (total knee replacement, hip replacement) without documentation that proper prevention efforts were implemented per current orthopedic standard of care guidelines
- Iatrogenic pneumothorax with venous catheterization
- Action: No additional payment to hospitals for treatment of these conditions unless the events were present on admission.
ALL of the following
- Participating acute care facilities must populate Present on Admission (POA) indicators on all inpatient claims; electronic 837I or paper claims received with incorrect or missing POA will be returned and/or denied.
- UHA may perform retrospective review to validate POA indicators; incorrect or missing POA may result in reduction or denial of payment for services related to never events or HACs.
ALL of the following
- For DVT/PE following certain orthopedic procedures (total knee replacement, hip replacement), payment requires documentation that proper prevention efforts were implemented in accordance with current orthopedic standard of care guidelines.
- Action: No payment for DVT/PE after these procedures without such documentation.
ALL of the following
- UHA reserves the right to perform retrospective reviews and may deny a portion or the entire hospital/provider claims for repetitive or catastrophic errors if dispute resolution fails.
- Hospitals may be denied payment or receive partial or negotiated payment when care does not meet acceptable standards and/or medical necessity guidelines.
ALL of the following
- Acute care inpatient hospitals are required to hold members harmless for any reduction in reimbursement for complications related to a never event or HAC.
- Physicians are required to hold members harmless for services related to the listed never events; providers remain financially responsible to members for these services.
Coding and Documentation Requirements
POA indicator valuesmixed
| Y | Yes - Diagnosis was present at time of inpatient admission. Payment may be permitted. |
| N | No - Diagnosis was not present at time of inpatient admission. No payment may be permitted when an appropriate diagnosis/E code identifies the never event or hospital-acquired condition. |
| U | Unknown - Documentation insufficient to determine if condition was present at time of inpatient admission. No payment may be permitted when appropriate diagnosis/E code identifies never event or hospital-acquired condition. |
| W | Undetermined - Clinically undetermined; provider unable to clinically determine whether the condition was present at time of inpatient admission. Payment may be permitted. |
| 1 | Blank/1 - CMS permits code '1' for providers exempt from CMS POA reporting requirements; UHA does not accept '1' as valid for participating providers and will work with the provider to obtain an appropriate POA value. (Provider must submit an appropriate value.) |
| Blank | Blank - UHA will work with provider to obtain appropriate POA value. (Provider must submit an appropriate value.) |
DVT/PE prevention documentation — required elements (orthopedic procedures)
Applicable proceduresTotal knee replacement and hip replacement (DVT/PE after these procedures require documentation of prevention efforts)
Required documentationDocumentation that proper DVT/PE prevention efforts were implemented in accordance with current orthopedic standard of care guidelines
Payment consequenceNo payment for treatment of DVT/PE following the listed orthopedic procedures without the required documentation
Standard referencedCurrent orthopedic standard of care guidelines for DVT/PE prevention
ScopeApplies to DVT/PE occurring after specified orthopedic procedures billed to participating acute care inpatient hospitals
Provider Billing Actions, POA Reporting, and Retrospective Review
Billing Rule
POA indicators required on all inpatient claims (use 837I/paper formats)
Populate Present on Admission (POA) indicators on all inpatient hospital claims; submit POA values matched to each diagnosis code. Electronic 837I or paper claims with incorrect or missing POA will be returned and/or denied. UHA will not accept a POA value of '1' for providers subject to this policy and will work with providers to obtain an appropriate POA value.
- Submit POA indicator values (Y, N, U, W, or appropriate value) matched to each diagnosis code.
- Do not use '1' (blank/exempt) as a valid POA response for providers covered by this policy; UHA will require correction.
- Prefer electronic 837I format; paper claims are accepted but must include correct POA indicators.
- Claims with incorrect or missing POA will be returned and/or denied and may result in payment reduction for related services.
Denial Risk
Retrospective review may lead to partial or full claim denial
UHA may perform retrospective review of claims and, if dispute resolution fails for repetitive or catastrophic errors, may deny a portion or the entire hospital and provider claims.
- UHA reserves the right to validate POA indicators and presence/absence of HACs/never events through retrospective review.
- Repeated diagnostic/therapeutic/documentation errors or a single catastrophic clinical error can trigger peer review and remediation efforts; unresolved disputes may lead to claim denial.
Definitions
Never Event — definition
DefinitionErrors in medical care that are clearly identifiable, preventable, and serious in their consequences and that indicate a problem in facility safety and credibility
Examples leading to exclusionSurgery performed on the wrong body part; surgery performed on the wrong patient; wrong surgical procedure performed on a patient
Payment impactHospitals will not receive reimbursement for complications related to listed never events
ImplicationSignals a process or safety failure that may prompt review and denial of payment
Hospital-Acquired Condition (HAC) — definition
DefinitionConditions that could reasonably have been prevented through application of evidence-based guidelines (CMS-listed HAC categories)
Scope — examplesIncludes retained foreign objects, air embolism, incompatible blood transfusion reactions, stage 3/4 pressure ulcers acquired after admission, falls/trauma, manifestations of poor glycemic control, catheter-associated infections, specified surgical site infections, and others as listed by CMS
Payment impactUHA will not provide additional payment to hospitals for treatment of these conditions unless the events were present on admission
ReferenceReferences the 14 CMS HAC categories (including FY2013 additions)
Present on Admission (POA) — definition and indicator guidance
DefinitionPresent on Admission (POA) indicates whether a diagnosis was present at the time of inpatient admission and must be submitted matched with diagnosis codes (Y, N, U, W, 1/Blank)
Acceptable indicator valuesY (Yes); N (No); U (Unknown); W (Undetermined); 1 (Blank) — with specific handling requirements
'1' / Blank handlingAlthough CMS permits '1' for providers exempt from POA reporting, this policy applies to all participating providers so '1' is not a valid response; UHA will work with the provider to obtain an appropriate POA value
Claim requirementParticipating acute care facilities must populate the POA indicator on all inpatient hospital claims; missing or incorrect POA may be returned or denied
Policy Summary
PayerUniversity Health Alliance (HSA)
PolicyReimbursement exclusions for never events and hospital-acquired conditions
Policy CodePolicy MPP-0021-120301
Change TypeTechnical/administrative (no material clinical changes)
Effective DateJun 26, 2024
Last ReviewJun 26, 2024
Next Review Date
Key ActionParticipating acute care facilities must populate Present on Admission (POA) indicators on all inpatient claims; claims with incorrect or missing POA may be returned, denied, or result in reduced payment.
SourceLink
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