Medicare Says 'No' to Bed Sores and Other Hospital Complications

States and private insurers also have begun to ask for more reporting of errors.

About 20 states already require reporting of medical errors such as those on the Forum's list of 28 preventable medical "events," said Janet Corrigan, president and chief executive of the National Quality Forum, a nonprofit group that sets standards for measuring and reporting health care.

"We know we can get very close to eliminating them," Corrigan said, if there is no reprisal against hospital workers who report mistakes, and if procedures are standardized so there is less reliance on memory and more on checklists and reminders.

Some patient advocates say that denying payments could hurt patients and lead to billing disputes among patients, hospitals and Medicare.

"Beneficiaries who fit certain illness profiles will not get services," said Alfred Chiplin, senior policy attorney for the Center for Medicare Advocacy. "Say someone comes in from a nursing home with pneumonia. Do they bring them in or pump them with an antibiotic and send them home?"

Paul H. O'Neill, a former Treasury secretary who has been involved in several health-care initiatives in Pennsylvania, says Medicare's emphasis is wrong.

"There are still an enormous number of errors, and at the crux of the problem is how do we eliminate this stuff? If we eliminate it, we don't have to pay for it at all," he said.

O'Neill suggested that Medicare fund several demonstration programs with hospitals that agree to work on eliminating errors. He is concerned the new rule could lead to less reporting of errors, since an analysis in Pennsylvania shows hospitals underreport mistakes.

Medicare's Kuhn said he expects reporting will be accurate. Regulators will watch claims closely, especially for how patients are screened and classified when being admitted to the hospital, he said.

The government may add more "never events" to the list, refusing payment for certain egregious surgical mistakes and extending the policy to outpatient settings.

"We have definitely gotten their attention," Kuhn said.

Cindy Skrzycki is a regulatory columnist with Bloomberg News. She can be reached at skrzycki@bloomberg.net.