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Journal Article


Medicare’s Policy to Limit Payment for Hospital-Acquired Conditions: The Impact on Safety Net Providers

The Issue

In 2008, Medicare instituted a policy limiting reimbursements to hospitals for treating certain avoidable hospital-acquired conditions, including pressure ulcers, certain infections, falls and trauma, and poor glycemic control. The policy will be expanded to Medicaid in 2011. While it is intended to spur improvements in health care delivery, little is known about the rule's effect on public and teaching hospitals and other safety-net providers.

What the Study Found

Using 2006 hospital survey and Medicare claims data, the Commonwealth Fund–supported researchers found a significantly higher rate of hospital-acquired conditions at safety-net hospitals, compared with non–safety-net hospitals. Safety-net hospitals had 65.6 hospital-acquired conditions per 1,000 Medicare patient discharges on average, compared with 57.6 at non–safety-net facilities. Among all hospitals, including safety-net facilities, those with the lowest financial margins had the most hospital-acquired conditions. Pressure ulcers and falls and trauma accounted for most hospital-acquired conditions across all hospitals.


Safety-net hospitals have higher rates of hospital-acquired conditions than non–safety-net hospitals and therefore are more likely to face monetary penalties under the current policy. Policymakers should be cautious when expanding the new policy to prevent harming hospitals that are providing care to society's most vulnerable and potentially limiting access for these patients.

Publication Details



M. McHugh, T. C. Martin, J. Orwat et al., "Medicare's Policy to Limit Payment for Hospital-Acquired Conditions: The Impact on Safety Net Providers," Journal of Health Care for the Poor and Underserved, May 2011 22(2):638–47.