Department of Health and Human Services
OFFICE OF 
   
INSPECTOR GENERAL 
 
 
 
 
 
 
 
 
ADVERS E EVENTS IN HOSPITALS:  
 
O K I  
VERVIEW OF  EY  SSUES
 
 
 
 
 
 
 
 
Daniel R. Levinson  
Inspector General 
 
December 2008 
OEI-06-07-00470   
Office of Inspector General 
http://oig.hhs.gov 
 
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as 
amended, is to protect the integrity of the Department of Health and Human Services 
 
(HHS) programs, as well as the health and welfare of beneficiaries served by those 
programs.  This statutory mission is carried out through a nationwide network of audits, 
 
investigations, and inspections conducted by the following operating components: 
 
Office of Audit Services 
The Office of Audit Services (OAS) provides auditing services for HHS, either by conducting 
audits with its own audit resources or by overseeing audit work done by others.  Audits 
examine the performance of HHS programs and/or its grantees and contractors in carrying 
out their respective responsibilities and are intended to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and 
mismanagement and promote economy and efficiency throughout HHS. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) conducts national evaluations to provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud, waste, or abuse and promoting 
economy, efficiency, and effectiveness of departmental programs.  To promote impact, OEI 
reports also present practical recommendations for improving program operations.  
Office of Investigations 
The Office of Investigations (OI) conducts criminal, civil, and administrative investigations 
of fraud and misconduct related to HHS programs, operations, and beneficiaries.  With 
investigators working in all 50 States and the District of Columbia, OI utilizes its resources 
by actively coordinating with the Department of Justice and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to criminal 
convictions, administrative sanctions, and/or civil monetary penalties. 
Office of Counsel to the Inspector General 
The Office of Counsel to the Inspector General (OCIG) provides general legal services to 
OIG, rendering advice and opinions on HHS programs and operations and providing all 
legal support for OIGs internal operations.  OCIG represents OIG in all civil and 
administrative fraud and abuse cases involving HHS programs, including False Claims Act, 
program exclusion, and civil monetary penalty cases.  In connection with these cases, OCIG 
also negotiates and monitors corporate integrity agreements.  OCIG renders advisory 
opinions, issues compliance program guidance, publishes fraud alerts, and provides other 
guidance to the health care industry concerning the anti-kickback statute and other OIG 
enforcement authorities. 
   
   
 E X E C U T I V E   S U M M A R Y  
OBJECTIVE
 
To provide a descriptive analysis of the key issues regarding adverse 
events in hospitals.  
BACKGROUND 
The term adverse event describes any harm to a patient as a result of 
medical care, such as infection because of contaminated equipment.  
The Tax Relief and Health Care Act of 2006 (the Act) mandates that the 
Office of Inspector General (OIG) report to Congress regarding the 
incidence of never events among Medicare beneficiaries, payment by 
Medicare or beneficiaries for services furnished in connection with such 
events, and the processes that the Centers for Medicare & Medicaid 
Services (CMS) uses to identify events and deny payment.  Never events 
are a specific list of serious events, such as surgery on the wrong 
patient, that the National Quality Forum deemed should never occur in 
a health care setting.  Expanding beyond this specific list, this and 
subsequent OIG reports use the broader term adverse event to provide 
for a more comprehensive examination of key issues.  This report is one 
in a series to fulfill the requirements in the Act and inform 
decisionmakers.  OIG work in this area will continue through 2009.   
To facilitate OIG efforts to comply with the mandate, we first sought to 
identify key issues regarding adverse events in hospitals to provide 
direction and context for our work.  This overview report combines 
evidence, analysis, and opinion from a wide range of sources.  These 
sources, which we refer to collectively as stakeholders, represent 
diverse entities involved in addressing adverse events in hospitals, 
including government agencies and other policymakers, professional 
associations, oversight organizations, patient safety groups, providers, 
and researchers.       
KEY ISSUES 
We identified the following seven issues as most critical to 
understanding the landscape of adverse events in hospitals: 
Issue 1:  Estimates of the incidence of adverse events in 
hospitals vary widely and measurement is difficult.  Research 
estimates of the frequency of adverse events in hospitals vary from    
3 percent to 20 percent of hospital admissions, in part because there 
OEI-06-07-00470    ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  i   
   
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is no optimal method for measuring incidence.  Research also 
indicates that elderly patients are particularly vulnerable.       
Issue 2:  Nonpayment policies for adverse events are gaining in 
prominence and are viewed as a powerful incentive to reduce 
incidence but raise potential drawbacks.  CMSs new policy will deny 
hospitals higher payment for admissions complicated by selected 
adverse events, and private health care payers are adopting similar 
policies.  Stakeholders generally believe that nonpayment provides an 
incentive to prevent costly adverse events.  Potential drawbacks of 
nonpayment raised by stakeholders include limited access to care, 
increased hospital costs, and reduced hospital revenue.    
Issue 3:  Hospitals rely on staff and managers to report adverse 
events internally, but barriers can inhibit reporting.  Reporting 
events and suspected causes can help hospitals improve practices to 
prevent adverse events and ensure accountability for poor care.  
Hospitals also use reported information to inform affected patients and 
families, which is thought to boost public trust, and to improve clinical 
decisionmaking and compliance in treatment.  However, hospital staff 
may not report events because they do not believe that reports will lead 
to improvement, do not have time, or fear punitive action.   
Issue 4:  Hospitals report adverse events to various oversight 
entities, although stakeholders suspect substantial 
underreporting.  Although there is no comprehensive national 
reporting system for adverse events, a number of Federal, State, and 
nongovernmental entities receive adverse event reports from hospitals.  
Hospitals are believed to underreport adverse events, although it is 
difficult to know to what extent.  However, stakeholders indicated that 
reporting every adverse event is not necessary to achieve the aim of 
improving practices to prevent adverse events.  
Issue 5:  Public disclosure of adverse events can benefit patients 
but also raises legal concerns for patients and providers.  Access to 
adverse event information provides public scrutiny that may pressure 
hospitals to improve practices.  However, concerns that hospitals, 
clinicians, and patients can lose legal protections when adverse event 
information is reported can inhibit full disclosure of adverse events.   
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E X E C U T I V E   S U M M A R Y  
Issue 6:  Information to help prevent adverse events is widely 
available, but some hospitals and clinicians may be slow to adopt 
or routinely apply recommended practices.  Hospitals and clinicians 
are sometimes slow to adopt recommended practices, such as     
evidence-based clinical practice guidelines, which outline systematically 
developed procedures to improve care.  Literature indicates that 
hospital staff and clinicians may believe that the guidelines are not 
relevant to their setting or that they value individual practitioner 
judgment more than regimented standards of care. 
Issue 7:  Interviews and literature reveal strategies that may 
accelerate progress in reducing the incidence of adverse events in 
hospitals.  Strategies included the following:  
   
  assessing the desirability and feasibility of a national body to lead 
patient safety efforts, which would help to coordinate, but not 
replace, current efforts by government agencies and private entities;   
  focusing on hospital use of recommended practices and                  
evidence-based guidelines to reduce the incidence of adverse events, 
including measuring hospital use;   
  establishing methods for measuring the incidence of adverse events, 
including tools for practical and accurate data collection;  
  expanding the use of electronic health records within and between 
hospitals, thus improving communication and continuity of care to 
potentially reduce the incidence of adverse events;  
  monitoring the impact of policies to deny hospitals higher payment 
for admissions complicated by selected adverse events; and  
  improving the utility of adverse event reporting, including 
evaluating the comparability of data reported across entities and 
streamlining reporting mechanisms to reduce burden on hospitals. 
SUMMARY 
The extensive range of entities involved in researching and addressing 
adverse events shows that reducing the incidence of adverse events is a 
high priority.  Stakeholders described the current environment among 
hospitals and policymakers as being on the threshold of accelerated 
progress.  They point to a large body of research as improving 
understanding, including recognition of the critical role of hospital 
systems in guarding against adverse events.  Additionally, new policies, 
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E X E C U T I V E   S U M M A R Y  
such as denying hospitals higher payment for admissions complicated 
by certain adverse events and public disclosure of events, strengthen 
hospital incentives to develop safer practices.  These advancements in 
clinical understanding, combined with heightened controls, hold 
promise for reducing the incidence of adverse events in hospitals and 
improving the quality of care. 
AGENCY COMMENTS 
We received comments on a draft of this report from the Agency for 
Healthcare Research and Quality (AHRQ) and CMS. 
AHRQ concurred with the reports findings.   
CMS commended OIG on succinctly capturing the numerous issues 
surrounding this complex topic, acknowledged technical assistance 
provided to OIG in conducting this study, and indicated that it 
welcomed continued work with OIG on this issue.  
CMS reiterated its policies to encourage the prevention of adverse 
events that are enumerated in the report, particularly the nonpayment 
provision for hospital-acquired conditions, noting that OIGs work is 
supportive of and will enable more effective CMS implementation of the 
provision.  CMS agreed that nonpayment for care associated with 
adverse events strengthens hospitals incentives to develop safety 
practices and reduces health care costs in the long term.  CMS also 
addressed the three potential drawbacks of nonpayment policies raised 
by stakeholders, providing further discussion to indicate that it believes 
these drawbacks are unlikely to occur. 
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 T A B L E   O F   C O N T E N T S  
EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
 
I N T RO DUC T IO N . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 
 
KEY ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 
  Issue 1:  Estimates of adverse event incidence vary widely . . . . . 11 
  Issue 2:  Nonpayment policies are gaining prominence. . . . . . . . . 16 
  Issue 3:  Hospitals rely on staff to report adverse events . . . . . . . 19 
  Issue 4:  Hospitals report adverse events to oversight entities. . . 22 
  Issue 5:  Public disclosure has benefits but raises concerns . . . . . 26 
  Issue 6:  Hospitals may be slow to apply practices . . . . . . . . . . . . 28 
  Issue 7:  Interviews and literature reveal strategies. . . . . . . . . . . 32 
 
SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 
 
AGENCY COMMENT S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 
 
APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 
  A:  Tax Relief and Health Care Act of 2006. . . . . . . . . . . . . . . . . . 36 
  B:  Glossary of Selected Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 
C:  National Quality Forum Serious Reportable Events. . . . . . . . 39 
  D.  List of Stakeholders Interviewed . . . . . . . . . . . . . . . . . . . . . . . 40 
E:  Examples of Data Analysis:  Stakeholder Interviews and   
Literature Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 
  F:  Examples of Research:  Incidence of Adverse Events. . . . . . . . 44 
  G:  Agency Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 
 
A C K NO WL E D G M E N T S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 
   
   
 I N T R O D U C T I O N  
OBJECTIVE 
To provide a descriptive analysis of the key issues regarding adverse 
events in hospitals.  
BACKGROUND 
Statutory Mandate and Office of Inspector General Response 
The Tax Relief and Health Care Act of 2006 (the Act) requires that the 
Office of Inspector General (OIG) study events that cause harm to 
Medicare beneficiaries.  The Act specifically mandates that OIG study 
the incidence of never events among Medicare beneficiaries, payment 
by Medicare or beneficiaries for services furnished in connection with 
such events, and administrative processes of the Centers for Medicare & 
Medicaid Services (CMS) to identify events and deny or recoup 
payment.  OIG is also to report to Congress on the study conducted, 
including recommendations for such legislation and administrative 
action as OIG determines appropriate.  (For relevant text of the Act, see 
Appendix A.) 
A variety of terms, lists, and definitions are used to identify and address 
harmful health care events.  (For a glossary of selected terms, see 
Appendix B.)  The term never event is used to describe a specific list of 
serious events that the National Quality Forum (NQF) determined 
should never occur in a health care setting and are associated 
primarily with patient death or serious disability.1  NQF currently uses 
the term serious reportable events to describe this list.  (For a list of 
NQF serious reportable events, see Appendix C.)  Expanding beyond the 
specific events defined by NQF, this and subsequent OIG reports use 
the broader and more common term adverse event to provide for a 
more comprehensive examination of key issues.   
Following a review of Medicare policies and expenditures, as well as 
consultation with CMS and the Agency for Healthcare Research and 
Quality (AHRQ), we chose to focus much of our work on the hospital 
setting.  Costs for inpatient hospital care constitute the largest portion 
 
1 NQF is a not-for-profit membership organization created to develop and implement a 
national strategy for health care quality measurement and reporting.  The list is available 
online at http://www.qualityforum.org/about.  Accessed on October 21, 2008. 
 
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of Medicare expenditures (29.6 percent in 2007).2  Also, many current 
efforts by government agencies and private entities to research and 
address adverse events target care provided in hospitals. 
OIG is conducting a series of studies through 2009 to fulfill the 
requirements in the Act and to inform decisionmakers regarding 
adverse events.  To facilitate OIG efforts to comply with the Act, we first 
sought to identify key issues regarding adverse events in hospitals to 
provide direction and context for our future work.  To describe these key 
issues, this overview report combines evidence, analysis, and opinion 
from a wide range of sources.  Key issues include current analysis and 
discourse regarding the primary components of the Act:  incidence, 
payment (including CMS processes), and the balance between protecting 
patient privacy and providing information to improve patient safety.  
Other OIG studies focus on estimating the incidence of adverse events 
among Medicare beneficiaries, State efforts to operate adverse event 
reporting systems, Medicare beneficiaries receiving potentially 
inappropriate drug pairs that may reflect medication errors, and 
hospital actions to address and prevent adverse events.      
Adverse Events in Hospitals 
The term adverse event describes any harm to a patient as a result of 
medical care.  An adverse event indicates that the care resulted in an 
undesirable clinical outcome and that the clinical outcome was not 
caused by an underlying disease.  Adverse events include medical 
errors, such as use of incompatible blood products.  They may also 
include more general substandard care that results in harm, such as 
infection because of contaminated equipment, incorrect diagnoses, and 
lack of patient monitoring during treatment.  Research, policies, and 
action taken to reduce adverse events often focus on mistakes and 
systemic problems with care.  However, adverse events do not always 
involve errors, negligence, or poor quality of care and may not always be 
preventable.      
Reducing the incidence of adverse events in hospitals is a critical 
component of efforts to ensure patient safety and to provide quality 
health care.  The Institute of Medicine (IOM) report, To Err is Human:  
Building a Safer Health System, is often credited with first drawing 
 
2 Based on data contained in Congressional Budget Office (CBO) Fact Sheet for CBOs 
March 2007 Baseline:  Medicare, March 7, 2007.  Available online at   
http://www.cbo.gov/budget/factsheets/2007b/medicare.pdf.  Accessed on September 8, 2008. 
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widespread attention to the issue of adverse events in hospitals.3  IOM 
cited two studies that used medical record reviews to identify adverse 
events (defined as injuries caused by medical management) with similar 
results.  The first study, using hospitalizations in a single State, found 
that 3.7 percent of hospital patients experienced adverse events,  
58 percent of these events were preventable, and 13.6 percent resulted 
in death.4  A second study, replicating the methodology in two other 
States, found that 2.9 percent of hospital patients experienced adverse 
events, of which 53 percent were preventable and 6.6 percent resulted in 
death.5  IOM extrapolated these results to hospital admissions 
nationwide for 1997, concluding that preventable adverse events caused 
at least 44,000 and perhaps as many as 98,000 deaths in hospitals each 
year.6   
Following the IOM report, the Federal Government formed the Center 
for Patient Safety and Quality Improvement within AHRQ to coordinate 
research regarding patient safety.  Since that time, AHRQ has 
conducted and funded many research efforts regarding adverse events, 
promulgated recommended practice guidelines, and provided much 
analysis and guidance regarding patient safety issues.  As of  
September 2008, the patient safety Web site operated by AHRQ, Patient 
Safety Network (PSnet), provides over 3,500 publications related to 
patient safety and adds an average of 10 publications a week.7   
Hospital Oversight and Guidance 
Various government agencies and other entities are responsible for 
addressing adverse events in hospitals, often as part of overall efforts to 
ensure that minimum standards are met and improve health care 
quality.  Federal and State governments, nonprofit entities, academic 
 
3 L. T. Kohn, J. M. Corrigan, and M. S. Donaldson, eds., To Err is Human:  Building a 
Safer Health System.  A Report of the Committee on Quality of Health Care in America, 
Institute of Medicine, Washington, DC, National Academy Press, 1999. 
4 T. A. Brennan, L. L. Leape, N. M. Laird, et al., Incidence of Adverse Events and 
Negligence in Hospitalized Patients:  Results of the Harvard Medical Practice Study 1, 
New England Journal of Medicine, 324(6), 1991, pp. 370376.  Abstract available online at 
http://content.nejm.org/cgi/content/abstract/324/6/370.  Accessed on October 10, 2008. 
5 E. J. Thomas, D. M. Studdert, H. R. Burstin, et al., Incidence and Types of Adverse 
Events and Negligent Care in Utah and Colorado, Medical Care, 38(3), 2000, pp. 261271.  
Abstract available online at http://www.ncbi.nlm.nih.gov/pubmed/10718351.  Accessed on 
October 10, 2008. 
6 L. T. Kohn, J. M. Corrigan, and M. S. Donaldson, eds., To Err is Human:  Building a 
Safer Health System.  A Report of the Committee on Quality of Health Care in America, 
Institute of Medicine, Washington, DC, National Academy Press, 1999.  
7 Estimate of number of publications based on interviews with PSnet editors.  AHRQ 
PSnet is available online at http://www.psnet.ahrq.gov/.  Accessed on October 9, 2008. 
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institutions, professional organizations, and accrediting bodies have set 
standards, issued guidance, and provided technical assistance to 
hospitals.  Additionally, hospitals must track and analyze adverse 
events as a condition of participation for Medicare and Medicaid 
certification.8  Although hospitals are required by CMS to develop and 
maintain systems for tracking adverse events, Federal regulations do 
not require specific system characteristics.   
Oversight of hospitals is generally conducted by States and 
accreditation organizations, most prominently the Joint Commission.  
The Joint Commission establishes standards for hospitals, conducts 
periodic surveys to review policies and to observe operations onsite, and 
accepts hospital reports of adverse events.  Accreditation by the Joint 
Commission is voluntary, and approximately 80 percent of U.S. 
hospitals are accredited.  Accreditation requires that hospitals comply 
with many standards, some of which relate specifically to patient 
safety.9  In 2002, the Joint Commission established its National Patient 
Safety Goals program to provide hospitals with recommended practices 
related to persistent patient safety problems.  National Patient Safety 
Goals include preventing patients from falling and preventing surgical 
errors.10  For 2009, the program added three goals specific to health 
care-associated infections.11 
State health departments address adverse events and quality-of-care 
issues through hospital licensing.  To be licensed, hospitals must meet 
minimum care standards established by the States.  In some States, a 
Joint Commission accreditation serves as evidence that these standards 
have been met.  Additionally, State health departments may conduct 
onsite surveys of hospitals in response to complaints by patients or 
families.  Other private organizations establish standards for quality of 
care or patient safety and give hospitals accreditation status or ratings 
based on meeting standards and demonstrating results.  Federally 
 
8 42 CFR  482.21. 
9 The Joint Commission, The Joint Commission Requirements Hospital Page, 
Requirements for Accreditation, updated October 29, 2008.  Available online at 
http://www.jcrinc.com/TJC-Requirements-Hospital-Page/.  Accessed on December 5, 2008. 
10 The Joint Commission, 2009 Hospital National Patient Safety Goals, October 2008.  
Available online at http://www.jointcommission.org/NR/rdonlyres/40A7233C-C4F7-4680-
9861-80CDFD5F62C6/0/09_NPSG_HAP_gp.pdf.  Accessed on October 21, 2008. 
11 The Joint Commission, News Release:  The Joint Commission Announces 2009 
National Patient Safety Goals, June 17, 2008.  Available online at 
http://www.jointcommission.org/PatientSafety/NationalPatientSafetyGoals/09_hap_npsgs.h
tm.  Accessed on August 28, 2008.  
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funded Quality Improvement Organizations, private entities that 
contract with CMS to support quality of care, also provide guidance and 
technical assistance to hospitals and other Medicare providers.     
Various health care entities often use different terms and definitions for 
adverse events.  Some of these entities have developed lists of adverse 
events for more precise definition and measurement of events, including 
the following prominent lists: 
  NQFserious reportable events, originally referred to as never 
events because they should never happen in a health care setting;12 
  The Joint Commissionsentinel events, the term sentinel 
denoting a serious event that signals the need for immediate 
investigation and response;13  
  AHRQPatient Safety Indicators (PSI), conditions or circumstances 
identifiable in administrative data, such as discharge and billing 
records;14 and 
  CMScategories of hospital-acquired conditions for which Medicare 
will not pay hospitals higher reimbursement.15 
Medicare Payment for Adverse Events 
Medicare traditionally did not distinguish between costs incurred in 
treating existing illness from those incurred as the result of adverse 
events.  Medicare reimbursement to hospitals is generally determined 
by grouping patient conditions into diagnosis-related groups (DRG) 
based on the average cost of care for patients with similar conditions.  
Historically, if a Medicare beneficiary experienced harm from an 
 
12 NQF, Serious Reportable Events in Healthcare 2006 Update:  A Consensus Report, 
Washington, DC, 2007, p. 7.  Available online at 
http://www.qualityforum.org/pdf/reports/sre/txsrepublic.pdf.  Accessed on October 10, 2008.   
13 The Joint Commisssion, Sentinel Events Fact Sheet, Section IV, Reviewable Sentinel 
Events, updated July 2007, p. 3.  Available online at 
http://www.jointcommission.org/NR/rdonlyres/F84F9DC6-A5DA-490F-A91F-
A9FCE26347C4/0/SE_chapter_july07.pdf.  Accessed on October 10, 2008. 
14 AHRQ, Patient Safety Indicators Overview, AHRQ Quality Indicators,          
February 2006.  Available online at 
http://www.qualityindicators.ahrq.gov/psi_overview.htm.  Accessed on August 28, 2008. 
15 CMS, Hospital-Acquired Conditions, August 19, 2008.  Available online at 
http://www.cms.hhs.gov/HospitalAcqCond/06_Hospital-
Acquired_Conditions.asp#TopOfPage.  Accessed on October 10, 2008. 
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adverse event that resulted in assignment of a more expensive DRG, 
CMS paid the full claim without any payment reduction.16   
Hospital-Acquired Conditions.  The Deficit Reduction Act of 2005 (DRA) 
required CMS to select at least two hospital-acquired conditions for 
which hospitals would not be paid higher Medicare reimbursement.17  
CMS issued a final regulation in August 2007 to initiate policy for which 
CMS would deny hospitals higher payment for admissions complicated 
by eight categories of hospital-acquired conditions.  CMS chose the 
categories of conditions in collaboration with the Centers for Disease 
Control and Prevention (CDC) and used the following criteria:   
  conditions that are high cost, high volume, or both; 
  conditions that, when present as a secondary diagnosis, result in 
assignment of a case to a DRG that has a higher payment; 
  conditions that could be reasonably prevented by using readily 
available evidence-based guidelines; and  
  conditions that are identifiable based on one or more unique 
diagnosis codes.18   
Changes to CMS Payment.  In addition to designating the list of 
categories of hospital-acquired conditions, the final regulation 
implements a more specific list of DRGs called Medicare Severity 
Diagnosis-Related Groups (MS-DRG).  MS-DRGs split some of the prior 
DRGs into two or three individual classes based on the presence of a 
complication or comorbidity.19  Each medical diagnosis (ICD-9-CM) 
code20 submitted must include a new indicator designating whether the 
condition is or is not present on admission (POA).21  The final rule 
applies only to traditional fee-for-service Medicare and does not apply to 
 
16 Department of Health and Human Services (HHS), CMS, Press Release, Eliminating 
Serious, Preventable, and Costly Medical Errors  Never Events, May 18, 2006.  Available 
online at http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=1863.  Accessed on 
August 28, 2008. 
17 DRA,  5001(c), P.L. No. 109-171 (adding Social Security Act,  1886(d)(4)(D)), 
provided for a quality adjustment in DRG payments for certain hospital-acquired 
conditions. 
18 Ibid.  
19 42 CFR  412.10, fiscal year (FY) 2008 Inpatient Prospective Payment System (IPPS) 
Final Rule, 72 Fed. Reg. 47130, 47138 (Aug. 22, 2007).   
20 The ICD-9-CM system assigns diagnoses and procedure codes associated with 
hospitalizations and is maintained jointly by the National Center for Health Statistics 
(NCHS) and CMS.  NCHS, The International Classification of Diseases, 9th Revision, 
Clinical Modification (ICD-9-CM), Sixth Edition, issued for use beginning October 1, 2007.  
21 DRA, P.L. No. 109-171,  5001(c), adding Social Security Act,  1886(d)(4)(D). 
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Medicare managed care (Medicare Advantage Organizations (MAO)).  
To determine how MAOs can be held accountable for adverse events, 
CMS will begin in 2010 to collect data from MAOs regarding care 
associated with adverse events.22 
In July 2008, CMS issued a final rule to expand the list of  
hospital-acquired conditions for a total of 10 categories of conditions.  
Effective October 1, 2008, CMS will deny hospitals higher payment for 
Medicare admissions complicated by these categories of conditions:23   
  Foreign object retained after surgery 
  Air embolism 
  Blood incompatibility 
  Pressure ulcers (Stages III and IV) 
  Falls resulting in fracture, dislocation, intracranial injury, or 
crushing injury; category also includes burn and electric shock 
  Manifestations of poor glycemic control resulting in certain 
conditions 
  Catheter-associated urinary tract infection 
  Vascular-catheter-associated infection 
  Deep vein thrombosis/pulmonary embolism associated with total 
knee replacement or hip replacement 
  Surgical site infection associated with certain surgeries 
Also in 2008, CMS began analysis of its coverage policy regarding 
certain events on the NQF list of serious reportable events24 and issued 
a letter to State Medicaid directors providing guidance for State 
implementation of a coordinated denial of higher payment for 
admissions wherein Medicaid serves as a secondary payer.25   
 
 
22 Supporting Statement for Paperwork Reduction Act Submissions:  Part C Medicare 
Advantage Reporting Requirements and Supporting Regulations, 42 CFR  422.516 (a).   
23 FY 2009 Final IPPS Rule, 73 Fed. Reg. 48434 and 48471 (Aug. 19, 2008). 
24 Social Security Act  1862(a)(1)(A) provides authority for CMS to determine whether a 
service or an item is reasonable and necessary.  CMS, Medicare Coverage Database, 
National Coverage Analyses:  Surgery on the Wrong Body Part; Surgery on the Wrong 
Patient; and Wrong Surgery Performed on a Patient, updated May 30, 2008.  Available 
online at http://www.cms.hhs.gov/mcd/index_list.asp?list_type=nca.  Accessed on   
November 4, 2008. 
25 CMS, Letter to State Medicaid Directors, SMDL #08-004, July 31, 2008.  Available 
online at http://www.cms.hhs.gov/SMDL/downloads/SMD073108.pdf.  Accessed on     
October 20, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  7   
   
SCOPE AND METHODOLOGY 
Scope 
This report describes key issues regarding adverse events in hospitals.  
We conducted a literature review of a wide range of published work 
covering not only adverse events but also the broader topic of patient 
safety.  We also conducted structured interviews with stakeholders, 
including researchers; clinicians; and officials from government 
agencies, oversight entities, and patient safety groups.  These activities 
occurred between March 2007 and November 2008. 
Literature Review 
The literature review included professional and academic journal 
articles and government reports.  We selected literature based on its 
relevancy to the topic, currency, and citation by other sources.  We 
identified published works using a variety of sources, including: 
  input from staff at AHRQ, CMS, and other stakeholders;  
  Internet search tools, e.g., AHRQs PSnet, Health Services Research 
Library, and Medline; and  
  bibliographies in literature identified by these sources.  
Stakeholder Interviews 
We conducted 85 structured interviews with a variety of stakeholders to 
gain insight into policies, practices, and viewpoints regarding adverse 
events.  The interview protocol covered a range of issues related to 
adverse events and patient safety, including the causes and frequency of 
events, strategies for addressing events, and payment for related care.  
In many cases, we had follow-up conversations with stakeholders later 
during our study period.  
In compiling the group of stakeholders, we sought to represent a broad 
spectrum of interests and viewpoints.  Interview respondents included 
experts in adverse events from a variety of perspectives, including 
national oversight, advocacy, and professional organizations, as well as 
health plans, hospitals, and practitioners experienced in identifying and 
addressing adverse events.  Additionally, stakeholders included many 
prominent researchers and policymakers in the field of patient safety, 
including several members of the initial NQF committee that developed 
the list of serious reportable events.  We identified stakeholders for 
interviews using a variety of sources, including:  
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  8   
   
I N T R O D U C T I O N  
  a list of patient safety entities and contacts provided by AHRQs 
Center for Quality and Patient Safety, the National Patient Safety 
Foundation, and the Joint Commission; 
  entities and contacts referenced in the literature; and  
  referrals from other stakeholders as our interviews progressed. 
We completed interviews with 98 percent of the identified stakeholders 
(78 of 80).  For cases in which we were not able to interview the 
identified stakeholders, we ensured that our list included stakeholders 
from similar entities.  For example, we interviewed staff from four State 
agencies identified as exhibiting a range of approaches to patient safety 
issues.  The viewpoints of the individuals we interviewed do not 
represent official positions of their organizations.  We selected 
representatives from each of the following broad groups.  (For a list of 
responding stakeholder entities, see Appendix D.)   
  Federal agencies8 interviews 
  State agencies4 interviews 
  Professional associations10 interviews 
  Oversight/standard-setting organizations5 interviews 
  Patient safety advocacy groups7 interviews 
  Public policy groups9 interviews 
  Providers (hospitals and networks)28 interviews 
  Private Payers (managed care organizations)4 interviews 
  University researchers5 interviews 
  Service contractors265 interviews 
Additional Data From Companion Study 
In our discussion of State adverse event reporting systems on  
pages 2326, we use information about State policies and practices 
collected for a companion study in this series, Adverse Events in 
Hospitals:  State Reporting Systems (OEI-06-07-00471).  The data were 
collected through interviews with and document requests of all States 
and the District of Columbia between January and April 2008. 
 
26 Service contractors include private entities that provide products or services to 
hospitals that are related to patient safety or quality of care, such as adverse event 
reporting software and medical record review. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  9   
   
III NNN TTT RRR OOO DDD UUU CCC TTT III OOO NNN    
Data Analysis 
Our analysis of information from literature and interviews focused on 
four primary tasks: 
  identifying and refining key issues;  
  gathering expert opinions, insight, and evidence regarding these key 
issues;  
  synthesizing this information to determine both prevailing and 
countervailing viewpoints of stakeholders and literature; and 
  identifying examples to illustrate and clarify these points.   
When we refer to stakeholder viewpoints in the report, these summary 
statements represent the predominant viewpoint of the stakeholders 
interviewed.  Despite the range of viewpoints represented, we found a 
great deal of agreement among stakeholders and the literature 
regarding the status of current efforts to address adverse events in 
hospitals.  Where we found widespread agreement, the report provides 
summary statements that reflect the predominant viewpoint of these 
sources.  Because of the variety of sources and the often nuanced 
discourse regarding these complex issues, this report does not provide 
stakeholder responses by percentage.  Rather, the report includes 
selected discussion and examples to illustrate the prevailing view or to 
add insight.  For examples of our analysis and quantified responses to 
key questions, see Appendix E.   
Limitations 
In collecting information, we sought to include widely recognized 
literature and stakeholders and to represent a wide variety of 
viewpoints based on research and analysis.  Additionally, the number of 
potential stakeholders was very large, necessitating selection of 
representatives to speak for each broader group of entities.  As a result, 
we may have excluded input that could have provided additional or 
different insight.  
Standards 
This study was conducted in accordance with the Quality Standards for 
Inspections issued by the Presidents Council on Integrity and 
Efficiency and the Executive Council on Integrity and Efficiency. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  10   
   
   KKEEYY     II SS SS UU EE SS     
_____________________________  
Issue 1:  Estimates of the incidence of adverse events in 
hospitals vary widely and measurement is difficult   
Most stakeholders reported that, although it is difficult to measure, 
they perceive that the incidence remains close to that cited by IOM in 
1999:  roughly 3 percent of hospitalized patients experience adverse 
events.  No subsequent study has attempted to determine a broad, 
national estimate of adverse events, such as was reported by IOM; 
however, researchers have conducted a number of smaller studies 
focusing on specific events and populations.  These efforts have provided 
a wide range of estimatesfrom less than 3 percent to greater than     
20 percent of patients experiencing adverse events.  See Appendix F for 
examples of this research, including rates and methods.  A number of 
stakeholders reported that when discussing the incidence of adverse 
events in general terms, they assume a slightly higher rate:  10 percent 
of hospital stays involve some type of health care-related problem, with 
about half (5 percent of hospital stays) resulting in some degree of harm 
to the patient and thereby constituting an adverse event.   
Research indicates that elderly patients have a greater number of 
preexisting conditions and face greater risks of experiencing adverse 
events.27  Stakeholders reported that adverse events are more common 
among the elderly because of the clinical complexity of their care, 
including multiple medications, higher rates of surgery, and longer 
hospital stays.  Elderly are particularly vulnerable to medication-
related adverse events, in large part because of administration of 
multiple medications.28   
Researchers use a variety of methods to measure incidence, but accurate 
identification of events is challenging and no single method is optimal  
Given the often complex nature of illness and injury, determining 
whether an adverse event occurred can be difficult.  Identifying adverse 
events may require evaluating the prior condition of the patient; 
determining what occurred in the delivery of health care; and 
 
27 T. A. Brennan and E. J. Thomas, Incidence and Types of Preventable Adverse Events 
in Elderly Patients:  Population Based Review of Medical Records, BMJ, 320,              
March 18, 2000, pp. 741744.  Available online at 
http://www.bmj.com/cgi/reprint/320/7237/741.  Accessed on October 10, 2008. 
28 D. M. Picone, M. G. Titler, J. Dochterman, et al., Predictors of Medication Error 
Among Elderly Hospitalized Patients, American Journal of Medical Quality, 23(2),    
MarchApril 2008, pp. 115127.  Abstract available online at  
http://www.ncbi.nlm.nih.gov/pubmed/18305099.  Accessed on October 10, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  11   
   
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distinguishing between the effect of the occurrence, the prior condition, 
and any natural progression of an illness or injury.  Stakeholders report 
that this difficulty can be compounded in a hospital setting, with 
patients receiving care from multiple caregivers and patients are 
subject to intricate hospital systems.  In some cases, patients and 
caregivers may not be aware that an event occurred and therefore do 
not record information useful for identifying the event retrospectively.   
Entities that address adverse events sometimes categorize them by the 
severity of harm incurred and may choose to focus on adverse events 
with the greatest degree of harm.  A commonly used scale of harm was 
developed by the National Coordinating Council for Medication Errors 
Reporting and Prevention (NCC MERP).29  The scale classifies events 
beginning with circumstances that have the capacity to cause error 
(near miss) and escalating through levels of patient harm (prolonged 
hospitalization, temporary disability) and eventually to patient death.  
NQFs list of serious reportable events and the Joint Commissions list 
of sentinel events include medication-related adverse events only when 
the patient suffers serious disability or death.30   
Researchers and hospitals use various methods to determine the 
incidence of adverse events and appear to have little agreement about 
the most reliable method.  Studies comparing the results of various 
methods have found widely divergent outcomes.  When researchers 
attempted to find the same adverse events using different data 
collection methods, results varied substantially.  For example, one study 
found that 8 percent of hospitalized patients reported an adverse event, 
but only half of these events were documented in the medical record, 
and none of the events were documented in the hospital incident 
reporting system.31  Comparisons of adverse event rates are difficult 
because researchers may use different definitions and methods for 
identifying adverse events.  For example, only two specific adverse 
events are characterized in the same way on all four of the prominent 
 
29 The National Coordinating Council for Medication Error Reporting and Prevention, 
NCC MERP:  The First Ten Years, Defining the Problem and Developing Solutions, 
December 2005, Figure 1, p. 29.  Available online at 
http://www.nccmerp.org/pdf/reportFinal2005-11-29.pdf.  Accessed on October 10, 2008. 
30 Sources referenced in footnotes 13 and 14 on p. 5. 
31 S. N. Weingart, O. Pagovich, D. Z. Sands, et al., What Can Hospitalized Patients Tell 
Us About Adverse Events?  Learning from Patient-Reported Incidents, Journal of General 
Internal Medicine, 20(9), 2005, pp. 830836.  Abstract available online at  
http://www.ncbi.nlm.nih.gov/pubmed/16117751.  Accessed on October 10, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  12   
   
KK EE YY    II SS SS UU EE SS   
lists referenced on page 5 (AHRQ, CMS, Joint Commission, and NQF):  
object left in patient after surgery and blood incompatibility.   
In some cases, events on different lists might cover the same 
circumstances even though they are defined differently.  For example, 
the Joint Commission list of Sentinel Events includes the broad 
definition of an event resulting in unanticipated death or permanent 
loss of function.32  The NQF list of Serious Reportable Events focuses 
primarily on events that result in death or serious disability, 
specifying the cause of the event, such as device contamination or 
medication error (see Appendix C).33  Additionally, CMS has taken 
steps to analyze the relationship between the NQF list and the CMS 
categories of hospital-acquired conditions.  In proposing conditions to be 
added to its list for FY 2009, a CMS press release indicated that the 
NQF list was used to inform selection of the hospital-acquired 
conditions.34 
Measurement challenges make it difficult to determine the actual 
incidence of adverse events and to gauge progress in reducing them.  In 
general, stakeholders advocate routine monitoring through automated 
methods to identify adverse events, followed by periodic use of more 
extensive methods to confirm results and uncover potential causes.  
Common methods include:  
  Administrative Data Screening.  Automated programs can review 
administrative data, such as payment claims and hospital discharge 
data, to identify possible adverse events.  For example, AHRQ 
developed software programs to calculate its PSIs using 
administrative data and distributes this software free of charge to 
hospitals, oversight entities, and researchers.  Using administrative 
data allows researchers to screen for adverse events among large 
 
32 The Joint Commission, Sentinel Event Policy and Procedures, Reviewable Sentinel 
Events, updated July 2007, p. 3.  Available online at 
http://www.jointcommission.org/NR/rdonlyres/F84F9DC6-A5DA-490F-A91F-
A9FCE26347C4/0/SE_chapter_july07.pdf.  Accessed on August 28, 2008. 
33 NQF, Serious Reportable Events in Health Care:  20052006 Update,              
October 16, 2006.  Available online at 
http://www.qualityforum.org/projects/completed/sre/fact-sheet.asp.  Accessed on          
August 28, 2008. 
34 HHS, CMS, Incorporating Selected NQF and Never Events into Medicares List of 
Hospital-Acquired Conditions, Press Release, April 14, 2008.  Available online at   
http://www.cms.hhs.gov/apps/media/press/factsheet.asp?Counter=3043&intNumPerPage=1
0&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&srchOp
t=0&srchData=&keywordType=All&chkNewsType=6&intPage=&showAll=&pYear=&year=
&desc=&cboOrder=date.  Accessed on August 28, 2008. 
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K E Y   I S S U E S  
numbers of cases and also provides a denominator for establishing a 
rate of events.  However, adverse events can be difficult to identify 
using automated methods, and research indicates that screening 
detects different types of adverse events at different rates.35  The 
newly required POA indicators will likely improve the effectiveness 
of screening for adverse events within Medicare claims data.  
  Electronic Medical Record Surveillance.  Routine surveillance of 
medical records is an emerging technology that serves as an initial 
screen to identify potential adverse events for further review.  
Surveillance systems detect adverse events in medical records by 
identifying unusual circumstances, such as prolonged 
hospitalizations or administration of an antidote.  Researchers 
report optimism that advances in these systems will enable 
hospitals to detect some adverse events as they occur.36  However, 
many hospitals lack computerized medical records and surveillance 
systems can be expensive to implement.37       
  Medical Record Review.  Medical records typically provide more 
complete information than administrative data regarding the impact 
of an event by including information about the patients condition 
prior to and following the event.  However, researchers report that 
records often have incomplete descriptions and insufficient 
documentation.38  Also, record reviews rely on the subjective 
judgment of the reviewer, and conditions caused by adverse events 
can be difficult to distinguish from preexisting conditions.  To 
improve validity, studies may rely on two or more reviewers to 
confirm the results of each chart review; however, researchers in one 
 
35 A. N. West, W. B. Weeks, and J. P. Bagian, Rare Adverse Events in VA Inpatient 
Care:  Reliability Limits to Using Patient Safety Indicators as Performance Measures, 
Health Services Research, 2007, pp. 249266.  Available online at 
http://www3.interscience.wiley.com/cgi-bin/fulltext/119390777/PDFSTART.  Accessed on 
October 10, 2008. 
36 M. K. Szekendi, C. Sullivan, A. Bobb, et al., Active Surveillance Using Electronic 
Triggers to Detect Adverse Events in Hospitalized Patients, Quality and Safety in Health 
Care, 15, 2006, pp. 184190.  Available online at 
http://qshc.bmj.com/cgi/content/full/15/3/184?rss=1.  Accessed on August 10, 2008.   
37 M. F. Furukawa, T. S. Raghu, T. J. Spaulding, and A. Vinze, Adoption of Health 
Information Technology for Medication Safety in U.S. Hospitals, 2006, Health Affairs, 27(3), 
MayJune 2008, pp. 865875.  Abstract available online at  
http://content.healthaffairs.org/cgi/content/abstract/27/3/865.  Accessed on October 10, 2008. 
38 M. M. Rosenthal, P. L. Cornett, K. M. Sutcliffe, and E. Lewton, Beyond the Medical 
Record:  Other Modes of Error Acknowledgment, Journal of General Internal Medicine, 
20(5), May 2005, pp. 404409.  Abstract available online at  
http://www.ncbi.nlm.nih.gov/pubmed/15963161.  Accessed on October 10, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  14   
   
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prominent study found moderate to poor interrater reliability 
between reviewers.39   
  Patient Surveys or Interviews.  A number of studies have sought to 
identify adverse events by asking patients and their families 
whether they detected any problems during hospitalization, 
typically through interviews or mail surveys.  This information is 
considered most useful when patients or families are asked about 
events shortly after they occur.  One study found that patients 
contacted within 10 days of discharge identified more adverse events 
affecting their care than medical record reviewers and hospital 
incident reports.40  Another study of medical errors received survey 
responses from 2,000 hospital patients and found that 11 percent of 
patients described problems but that, when verified against medical 
records, only 2 percent described events that represented actual 
medical errors.41  Stakeholders indicated that potential drawbacks 
with patient surveys include low response rate, poor recollection by 
patients, and lack of understanding of adverse events.   
  Observation of Patient Care.  Clinical observation relies on collecting 
information during or immediately after the delivery of care.  
Observational data can derive from direct clinical observation        
(in person or by recording) and surveys of clinicians.  Based on a 
review of several studies using this method, observation typically 
finds a higher incidence of adverse events than other methods and is 
thought to provide more precise descriptions of adverse events than 
other methods.42  For example, one study of operating room 
anesthesia found a 30-percent rate of adverse events identified 
 
39 E. J. Thomas, D. M. Studdert, and T. A. Brennan, The Reliability of Medical Record 
Review for Estimating Adverse Event Rates, Annals of Internal Medicine, 136(11),       
June 2002, pp. 812816.  Available online at   
http://www.annals.org/cgi/reprint/136/11/812.pdf?ijkey=0235f38f381989d08b8fb62bde3bf9f1
ae94951c.  Accessed on October 10, 2008. 
40 S. N. Weingart, O. Pagovich, D. Z. Sands, et al., What Can Hospitalized Patients Tell 
Us About Adverse Events?  Learning from Patient-Reported Incidents, 2005, pp. 830836.  
Abstract available online at http://www.ncbi.nlm.nih.gov/pubmed/16117751.  Accessed on 
October 9, 2008. 
41 L. I. Solberg, S. E. Asche, and B. M. Averbeck, Can Patient Safety Be Measured by 
Surveys of Patient Experiences?  The Joint Commission Journal on Quality and Patient 
Safety, 34(5). May 2008, pp. 266274.  Abstract available online at  
http://www.ncbi.nlm.nih.gov/pubmed/18491690.  Accessed on October 9, 2008. 
42 J. M. Rothschild, C. P. Landrigan, J. W. Cronin, et al., The Critical Care Safety 
Study:  the Incidence and Nature of Adverse Events and Serious Medical Errors in 
Intensive Care, Critical Care Medicine, 33, 2005, pp. 16941700.  Abstract available online 
at http://www.ncbi.nlm.nih.gov/pubmed/16096443.  Accessed on October 10, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  15   
   
KK EE YY    II SS SS UU EE SS   
through a physician survey administered immediately following 
surgery.43  Drawbacks to observation of patient care reported by 
stakeholders include high labor costs, the necessity for highly 
trained observers, human error in recognizing adverse events, and 
concerns about patient confidentiality.   
 
_____________________________  
Issue 2:  Nonpayment policies for adverse events are 
gaining in prominence and are viewed as a powerful 
incentive to reduce incidence but raise potential 
drawbacks   
In 2008, CMS implemented policy to deny hospitals higher payment for 
admissions complicated by selected adverse events.  Stakeholders 
reported their belief that policies of nonpayment to hospitals for care 
associated with adverse events will put financial pressure on providers 
to improve patient safety and reduce the incidence of adverse events.  
They also reported that nonpayment may change clinical practice and 
hospital procedures to more closely follow recommended guidelines for 
quality of care and patient safety.44  However, stakeholders cautioned 
that nonpayment for adverse events may cause negative consequences, 
such as limiting patients access to care and increasing costs to hospitals 
while reducing revenue.   
Private health care payers and hospitals are increasingly adopting 
policies to eliminate payment for hospital-acquired conditions  
A small number of hospitals and health plans instituted nonpayment 
policies in previous years, but these policies are becoming more 
widespread following the change in CMS policy.  The first private health 
plan to deny payment for hospital-acquired conditions, a single State 
insurer with about 2 million enrollees, began its nonpayment policy in 
 
43 A. Oken, M. D. Rasmussen, J. M. Slagle, et al., A Facilitated Survey Instrument 
Captures Significantly More Anesthesia Events Than Does Traditional Voluntary Event 
Reporting, Anesthesiology, 107(6), December 2007, pp. 909922.  Available online at 
http://www.anesthesiology.org/pt/re/anes/pdfhandler.00000542-200712000-
00010.pdf;jsessionid=LyypRm2F9dD90HQ2mH2rh3HvpGQTDpppWhjlhXdNQgJkt9lHvqlp!
691622333!181195628!8091!-1.  Accessed on October 9, 2008. 
44 R. M. Wachter, N. E. Foster, and R. A. Dudley, Medicares Decision to Withhold 
Payment for Hospital Errors:  The Devil is in the Details, Joint Commission Journal on 
Quality and Patient Safety, February 2008, 34(2), pp. 116123.  Abstract available online at   
http://www.ncbi.nlm.nih.gov/pubmed/18351196.  Accessed on October 9, 2008.   
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  16   
   
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2005.45  An increasing number of private health plans, including several 
large national companies, announced plans in 2007 and 2008 to develop 
nonpayment policies, although full implementation may be a year or 
more away.  Similarly, hospitals are increasingly adopting policies to 
withhold billing for care associated with certain adverse events, 
regardless of whether the payer is the government, a health plan, or the 
patient.  A 2007 hospital survey found that 52 percent of responding 
hospitals (1,285 hospitals) had adopted this no bill policy, most within 
the prior year.46   
Stakeholders predict that nonpayment policies will reduce health care 
costs in the long term   
Potential cost savings include both savings in government and    
private-payer reimbursement owing directly to nonpayment and cost 
savings found through reducing adverse events by way of improved 
practices.  This business case for safety argues that any costs 
expended to improve patient safety are outweighed by the reduced 
medical expenses, shorter recovery times, and higher quality of life for 
patients who avoid harm (injury or illness) associated with an adverse 
event.47  Research indicates that the cost of adverse events is high and 
that, prior to nonpayment policies, hospitals did not bear the impact of 
these costs.  A study of individual hospital costs found that the annual 
cost of care associated with adverse drug events for a 700-bed hospital 
was $5.6 million,48 and a 2003 study aggregating costs across hospitals 
 
45 Health Partners, Inc., Health Partners Hospital Payment Policy:  Never Events 
Policy.  Available online at http://www.healthpartners.com/portal/866.html.  Accessed on 
September 8, 2008. 
46 Healthcare Financial Management Association News, Half of U.S. Hospitals 
Reporting to Leap Frog Say They Wont Bill for a Never Event, September 28, 2007.     
Available online at http://www.hfma.org/hfmanews/default,month,2007-09.aspx.  Accessed 
on September 8, 2008. 
47 M. Mello, D. Studdert, E. Thomas, et al., Who Pays for Medical Errors:  An Analysis 
of Adverse Event Costs, the Medical Liability System, and Incentives for Patient Safety 
Improvement, Journal of Empirical Legal Studies, 4(4), December 2007, pp. 835860.  
Available online at http://www3.interscience.wiley.com/cgi-
bin/fulltext/117994376/PDFSTART.  Accessed on October 13, 2008. 
48 D. W. Bates, N. Spell, D. J. Cullen, et al., The costs of adverse drug events in 
hospitalized patients, the Journal of the American Medical Association, 277(4),        
January 22, 2007, pp. 307312.  Abstract available online at http://jama.ama-
assn.org/cgi/content/abstract/277/4/307?ijkey=87ede15670fb1a6e28e177d75d105fde5d61dc1
7&keytype2=tf_ipsecsha.  Accessed on October 13, 2008. 
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estimated that certain medical injuries among hospitalized patients 
nationwide result in excess charges of $9.3 billion annually.49    
Potential drawbacks of nonpayment could include limiting access to care 
and increasing hospital costs while reducing revenue  
The emergence of nonpayment policies has accelerated longstanding 
debates regarding adverse events, such as how readily preexisting 
conditions can be diagnosed and which parties are responsible for 
additional health care costs resulting from adverse events.  
Stakeholders raised the following potential drawbacks to nonpayment:   
Limiting Access to Care.  Stakeholders raised concern that to avoid 
hospital-acquired conditions, hospitals may limit access for high-risk 
patients.  High-risk patients, such as the elderly, are likely to have 
several ailments and therefore require more complicated care.  Such 
patients might be more likely to bring conditions into hospitals that are 
easily missed (such as pressure ulcers) or to have poor outcomes of care 
as a result of their compounded ailments and frailty.   
Increased Hospital Costs.  Hospitals anticipate initial cost increases as a 
result of implementing nonpayment policies, including training and 
systems costs to incorporate changes in processing claims and increased 
costs in testing for and diagnosing conditions POA.  Staff also voiced 
concern that unilateral testing could lead to inappropriate treatment 
that could place patients at clinical risk.  For example, a physician 
specializing in emergency care noted that it is common for elderly 
patients to enter the hospital with mild urinary tract infections 
unrelated to the primary conditions that require urgent care.  A positive 
test for infection could lead the clinician to administer antibiotics that 
serve little clinical benefit but could put the patient at risk for 
additional ailments, such as stomach ulcers, and could ultimately lead 
to the emergence and spread of drug-resistant microorganisms, placing 
patients and health care workers at risk.50   
Changes in Hospital Revenue.  Hospitals could experience decreases in 
revenue for some admissions at the same time as their costs rise.  
 
49 C. Zahn and M. R. Miller, Excess Length of Stay, Charges, and Mortality Attributable 
to Medical Injuries During Hospitalization, the Journal of the American Medical 
Association, 290(14), October 8, 2003, pp. 18681874.  Available online at http://jama.ama-
assn.org/cgi/content/full/290/14/1868.  Accessed on October 9, 2008. 
50 C. Edlund and C. E. Nord, Effect on the Human Normal Microflora of Oral Antibiotics 
for Treatment of Urinary Tract Infections, Journal of Antimicrobial Chemotherapy,  
Suppl. 46(S1), 2000, pp. 4148.  Available online at 
http://jac.oxfordjournals.org/cgi/reprint/46/suppl_1/41.  Accessed on October 10, 2008. 
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Hospitals will no longer be reimbursed for costs related to adverse events 
and formerly covered by Medicare and health plans.  For example, if a 
Medicare patient entered a hospital with pneumonia and developed a 
urinary tract infection during the hospitalization, the hospital would be 
reimbursed approximately $6,254 under the prior payment system 
(pneumonia with complications).  Under the new rule, the hospital would 
be reimbursed approximately $3,705 (simple pneumonia), a difference of 
approximately 40 percent.51  However, stakeholders in interviews and also 
CMS52 have estimated that because the revised CMS payment policy 
provides for larger Medicare reimbursements for sicker patients by 
considering complications and comorbidities in determining MS-DRGs, 
hospitals might experience an overall increase in revenue. 
 
 
Issue 3:  Hospitals rely on staff and managers to report 
adverse events internally, but barriers can inhibit 
reporting 
Hospital managers whom we interviewed typically rely on the staff 
involved or department managers to report adverse events to hospital 
quality improvement or risk management departments.  Stakeholders 
see routine reporting of adverse events as an important component of 
improving patient safety.  Reporting an adverse event is thought to 
create a sense of transparency among providers, regulators, and 
patients, fostering openness, communication, and accountability for 
care.  Reporting adverse events and suspected causes can help hospitals 
develop improved practices to prevent recurrence and ensures 
accountability for substandard care.  Encouraging open staff reporting 
was cited as part of a growing movement toward a just culture that 
emphasizes systems problems over individual blame for mistakes.53        
 
51 M. B. Rosenthal, Nonpayment for Performance?  Medicares New Reimbursement 
Rule, The New England Journal of Medicine, 357(16), October 18, 2007, pp. 15731575.   
Available online at http://content.nejm.org/cgi/reprint/357/16/1573.pdf.  Accessed on   
October 10, 2008.  
52 CMS, Office of Public Affairs, Press Release, CMS Proposes to Expand Program for 
Hospital Inpatient Services in FY 2009, April 14, 2008.  Available online at  
http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=3041&intNumPerPage=10&
checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&keywordT
ype=All&chkNewsType=1%2C+2%2C+3%2C+4%2C+5&intPage=&showAll=&pYear=&year
=&desc=false&cboOrder=date.  Accessed on October 10, 2008.   
53 R. M. Wachter, Understanding Patient Safety, McGrawHill, 2008, pp. 175176.  
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Hospitals may conduct a root cause analysis (RCA) following a report of 
an adverse event.  The RCA is a focused review of systems and 
processes to identify the basic or contributing factors that cause adverse 
events.  RCAs vary considerably in depth and detail, with 
documentation and analysis sometimes including interview transcripts, 
medical records, certification surveys, and billing data.  Once it is 
complete, the RCA results can be assessed by hospital managers or 
quality improvement staff to help them develop a corrective action plan.  
Hospitals may retain RCAs and corrective action plans internally or 
submit them with supporting documentation to oversight entities.   
Hospital staff whom we interviewed also reported using information 
about adverse events to inform affected patients and family members, 
which is thought to boost public trust and lead to improved clinical 
decisionmaking and compliance in treatment.  One study found that 
providers disclosing information and accepting responsibility for 
adverse events was often more important to patients and families than 
receiving financial compensation.54  Some health networks, including 
the Veterans Health Administration, have formalized this effort 
through rapid response teams that are required to immediately assess 
adverse event reports, provide same-day information to patients and 
families, and take action to mitigate harm and prevent recurrence.55     
Hospital staff may not report adverse events because they do not believe 
reports lead to improvement, do not have time, or fear punitive action  
Stakeholders, including hospital managers, indicated that hospital staff 
do not report all adverse events, although estimates of how many 
adverse events are not reported vary widely.  In interviews, hospital 
managers gave estimates as low as 5 percent of adverse events reported 
to as high as nearly 100 percent, attributed to focused training on 
identifying adverse events.  Stakeholders reported the following reasons 
 
54 L. L. Leape, Full Disclosure and Apology:  An Idea Whose Time Has Come, Physician 
Executive, MarchApril, 2006, pp. 2426.  Available online at  
http://findarticles.com/p/articles/mi_m0843/is_2_32/ai_n16123939.  Accessed on          
October 9, 2008. 
55 Veterans Health Administration, 2007 VHA Research Series, Rapid Response Teams:  
A Bridge Over Troubled Waters, 2007.  Available online at 
http://www.vha.com/portal/server.pt/gateway/PTARGS_0_2_6781_1052_505725_43/http%3B
/ContentSrv.VHA.com%3B7087/publishedcontent/publish/vha_public/solutions/clinical_impr
ovement/docs/rrt_final.pdf.  Accessed on October 10, 2008. 
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for not reporting in order of prominence (literature referenced provides 
additional discussion):56 57 58 59 
  lack of followup by responsible staff when reports are made,   
  lack of time to complete incident reports and documentation, 
  fear of punitive action against self or a colleague,  
  assumption that other involved staff will report, 
  failure to track care as patients move through multiple departments 
and caregivers, and  
  difficulty in distinguishing adverse events from harm caused by 
underlying disease.   
Stakeholders also stressed the importance of hospitals taking action to 
encourage staff to report adverse events through such measures as 
strengthening enforcement, streamlining procedures, training staff on 
reporting procedures, and ensuring confidentiality when possible.  
Allowing anonymous reporting or ensuring confidentiality of reporters 
has been shown to increase reporting, but can limit the usefulness of 
reports because those analyzing the adverse events are not able to 
follow up to clarify the event and possible causes.60  
 
 
 
 
 
56 IPRO, Error Reporting Systems:  Feedback and Communication, Patient Safety 
Tools:  Information and Resources on Patient Safety for Health Care Providers Across New 
York State, 1(5), Fall 2007.  Available online at                    
http://providers.ipro.org/index/ps-newsletter-summer07.  Accessed on October 13, 2008.   
57 S. M. Evans, J. G. Berry, B. J. Smith, et al., Attitudes and Barriers to Incident 
Reporting:  A Collaborative Hospital Study, Quality and Safety in Health Care, 15, 2006, 
pp. 3943.  Abstract available at http://qshc.bmj.com/cgi/content/abstract/15/1/39.  Accessed 
on October 13, 2008. 
58 C. Conerly, Strategies to Increase Reporting of Near Misses and Adverse Events, 
Journal of Nursing Care Quality, 22(2), AprilJune 2007, pp. 102106.  
59 J. A. Taylor, D. Brownstein, D. A. Christakis, et al., Use of Incident Reports by 
Physicians and Nurses to Document Medical Errors in Pediatric Patients, Pediatrics, 
114(3), September 2004, pp. 729735.  Available online at 
http://pediatrics.aappublications.org/cgi/reprint/114/3/729.  Accessed on October 13, 2008.    
60 J. Stow, Using Medical Error Reporting to Drive Patient Safety Efforts, AORN 
Journal:  Association of periOperative Registered Nurses, September 2006, pp. 1317.  
Available online at http://findarticles.com/p/articles/mi_m0FSL/is_3_84/ai_n27000693.  
Accessed on October 13, 2008.  
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_____________________________  
Issue 4:  Hospitals report adverse events to various 
oversight entities, although stakeholders suspect 
substantial underreporting 
Although no comprehensive national reporting system for adverse 
events currently exists, various government agencies and other entities 
receive adverse event reports from hospitals.  These outside entities 
typically require or request reports about only a subset of adverse 
events, usually the most serious (such as wrong surgery) or those likely 
to affect the broader hospital population (such as infections).  For 
example, the quality assurance director of one 102-bed hospital reported 
receiving between 250 and 300 reports of adverse events or near 
misses61 a month from hospital staff, of which only 2 or 3 typically 
meet severity levels requiring a report to the State or accrediting body.   
IOM and other stakeholders advocate a two-tiered national system of 
mandatory reporting of serious adverse events and voluntary reporting 
of less serious adverse events and near misses because both systems 
have unique advantages.62  Mandatory reporting of serious events is 
thought to ensure provider accountability for medical errors and 
substandard care.  Voluntary reporting can capture a broader range and 
may uncover underlying problems more readily than a smaller number 
of serious adverse events.  Some researchers advocate reporting near 
misses in particular, believing that because a person or system was in 
place to prevent harm, they uncover not only the cause of potential 
adverse events but possible solutions because harm was averted.  
Including a broader range of adverse events, however, can make the 
number of reports unmanageable.63  One State modified its reporting 
system from including all unusual occurrences that threaten welfare, 
safety, or health to only the 28 adverse events on the NQF list, 
reporting that the original was too global to be administered well.64 
 
61 A near miss is an event or a situation that did not result in patient injury, but only 
because of intervening factors, such as patient health or timely intervention.   
62 L. T. Kohn, J. M. Corrigan, and M. S. Donaldson, eds., To Err is Human:  Building a 
Safer Health System.  A Report of the Committee on Quality of Health Care in America, 
Institute of Medicine, Washington, DC, National Academy Press, 1999. 
63 T. A. Brennan, A. Gawande, E. Thomas, and D. Studdert, Accidental Deaths, Saved 
Lives and Improved Quality, Sounding Board, The New England Journal of Medicine, 
353(13), September 29, 2005.  Available online at 
http://content.nejm.org/cgi/reprint/353/13/1405.pdf.  Accessed on October 10, 2008. 
64 Stakeholder interview with staff of the California Department of Health, January 
2008.  
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State Reporting Systems.  Public health departments in 25 States and 
the District of Columbia operate adverse events reporting systems.65   
States may also have systems targeted toward specific events; for 
example, the Government Accountability Office reported in 2008 that  
23 States require mandatory reporting of health care-associated 
infections in hospitals.66  States typically require that adverse events be 
reported within a specific timeframe.  They may also require that 
hospitals submit the RCA results along with the adverse event report 
and a corrective action plan that outlines how the hospital plans to 
address the problem.  State staff reported using information in a variety 
of ways, including issuing periodic alerts to caution providers about 
specific problems and trends, reporting to the public as a hospital 
quality measure, and routing information about the most egregious 
adverse events to State oversight agencies.   
National Reporting Systems.  Two Federal agencies operate national 
reporting systemsCDC and the Food and Drug Administration (FDA) 
and a variety of accreditation, oversight, and advocacy groups operate 
additional systems.  Some of these national reporting systems collect 
information on a full range of adverse events, such as the Joint 
Commissions Sentinel Event Reporting System and the Veterans 
Health Administrations Patient Safety Reporting System.  Others focus 
on particular types of adverse events.  For example, FDA operates 
systems that monitor adverse events associated with drugs, medical 
devices, vaccines, and blood products, and CDC operates a system to 
monitor health care-associated infections and comanages the vaccine 
system with FDA.   
Patient Safety Organizations.  The Patient Safety and Quality 
Improvement Act of 2005 (Patient Safety Act) established a national 
network of Patient Safety Organizations (PSO), certified by HHS, to, 
among other tasks, accept voluntary reports of adverse events from 
hospitals.67  Further, HHS must develop common formats that PSOs 
can choose to use for reporting information and must maintain a 
 
65 OIG analysis of interviews and documentation from all States and the District of 
Columbia, collected JanuaryApril, 2008.  
66 Government Accountability Office, Health-Care-Associated Infections in Hospitals:  
An Overview of State Reporting Programs and Individual Hospital Initiatives to Reduce 
Certain Infections, September 2008, p. 2.  Available online at 
http://www.gao.gov/new.items/d08808.pdf.  Accessed on October 10, 2008. 
67 P.L. No. 109-41,  923 (July 29, 2005). 
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national database to analyze adverse events reported by PSOs.68  (The 
Patient Safety Act provides Federal legal privilege and confidentiality 
protections for reported information.69)  A variety of entities, including 
hospital networks and health plans, are expected to submit applications 
to serve as PSOs in 2009 and to be operational by 2010.  AHRQ is 
tasked with reviewing these applications, determining which entities 
will serve as PSOs, and developing operational guidelines (including 
common definitions for adverse events).  PSOs will have flexibility in 
developing policies and practices and will receive no Federal funding.   
Some stakeholders expressed concerns regarding PSO implementation, 
including hospitals that may be reluctant to pay contract costs for PSOs 
when many already report to States; analysis of adverse event 
information reported by PSOs may be difficult because the PSOs are not 
required to use the common formats for defining adverse events; and 
hospitals may report the same adverse events to multiple PSOs, causing 
duplicate reports that could skew aggregated data.  
Stakeholders indicate that adverse events are underreported and that 
oversight entities may not have mechanisms to promote compliance 
Stakeholders suspect substantial underreporting of adverse events to 
outside entities, although it is difficult to know the extent to which 
adverse events go unreported.  Underreporting could result from the 
range of barriers and disincentives to report and the inherent difficulty 
in recognizing all adverse events, such as those resulting in only 
temporary harm to the patient.  Stakeholders question whether the 
value of reporting systems is worth the administrative costs, 
particularly when the entity that receives reports does not reciprocate 
by providing information for improving quality of care. 
The number of reports received by various oversight entities varies 
substantially.  For example, States reported that they received as few as 
6 and as many as 16,000 reports in 2006.70  One State that collects 
reports for events on the NQF list of Serious Reportable Events received  
125 reports for approximately 2.8 million patient days between  
 
68 PSO regulations were developed jointly by AHRQ and the Office of Civil Rights.  
Proposed regulations were published February 12, 2008, (73 Fed. Reg. 8112) and are 
expected to be final by early 2009.   
69 P.L. No. 109-41,  922 (July 29, 2005). 
70 OIG analysis of interviews and documentation from all States and the District of 
Columbia, collected JanuaryApril 2008. 
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October 2006 and October 2007.71  National reporting systems also 
indicate a wide range in the number of reports that they receive from 
hospitals.  For example, an FDA source estimated that 10 percent of 
adverse drug events are reported to its reporting system, Medwatch, 
and also expressed concern that many reports are of poor quality
incomplete and poorly documented.72  Officials at the Joint Commission 
estimate that its voluntary Sentinel Event Reporting System captures 
only 1/10th of 1 percent of sentinel events that occur in accredited 
hospitals.73   
Detailed and duplicative reporting requirements may also lead to 
underreporting.  Hospitals are often required to report adverse events 
sometimes the same eventto several different entities, which hospital 
staff indicated takes considerable staff time and effort.  For example, in 
one State, a single adverse event involving a medication error may 
require reporting to eight different entities, each with different 
reporting mechanisms and standards.  Further, some oversight entities 
require substantial information for each reported event, such as an 
RCA, a corrective action plan, staff surveys, and medical records.   
Stakeholders raised concern that even prominent oversight entities 
have limited ability to ensure that serious adverse events are reported 
consistently and accurately.  This was thought to be in part because 
several key reporting systems have only voluntary reporting, and also 
because there may be subjectivity in determining what conditions are 
reported.  Even when reporting is mandatory, systems may have little 
active oversight and enforcement.  Hospitals can have few incentives to 
report adverse events, particularly when reporting involves risks of 
disclosure and punitive action.74  Stakeholders indicated that oversight 
entities do not know the extent of underreporting, so they cannot 
 
71 Minnesota Department of Health, Adverse Health Events in Minnesota:  Fourth 
Annual Public Report, January 2008, p. 9.  Available online at 
http://www.health.state.mn.us/patientsafety/ae/aereport0108.pdf.  Accessed on July 3, 2008. 
72 Board on Health Sciences Policy, Adverse Drug Event Reporting:  The Roles of 
Consumers and Health-Care Professionals, 2007.  Available online at 
http://books.nap.edu/openbook.php?record_id=11897&page=14.  Accessed on               
October 10, 2008. 
73 Stakeholder interviews with staff of the Joint Commission, March and          
September 2007.   
74 J. S. Weissman, C. L. Annas, A. M. Epstein, et al., Error Reporting and Disclosure 
Systems:  Views from Hospital Leaders, the Journal of the American Medical Association, 
293(11), March 16, 2005, pp. 13591366.  Abstract available online at http://jama.ama-
assn.org/cgi/content/abstract/293/11/1359.  Accessed on October 13, 2008. 
 
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determine whether analysis of reported information is an accurate 
characterization of adverse events.   
Many researchers indicated that full reporting of all adverse events may 
be less useful than receiving detailed reports of fewer adverse events 
Many stakeholders conducting research in adverse events assert that it 
is more important for quality improvement to receive detailed 
information about reported adverse events, such as the results of RCAs, 
than to ensure reporting of all adverse events.  These researchers 
maintained that counting particular adverse events is not as critical as 
the underlying problems within hospital processes that resulted in the 
specific events.  Because of underreporting, the number of reported 
adverse events is not considered to be a reliable measure of the incidence 
of adverse events in hospitals.  Researchers note that counting types of 
adverse events can contribute to faulty analysis of problems because it 
does not concentrate on the underlying systems or actions, which they 
view as more important to the goal of reducing adverse events.  For 
example, two medication errors might be counted together for a study of 
incidence, although one is caused by poor product labeling and the other 
by poor communication between nurses and pharmacists.    
 
_____________________________  
Issue 5:  Public disclosure of adverse events can benefit 
patients, but also raises legal concerns for patients and 
providers 
Much debate goes on regarding disclosure of adverse event information 
to affected patients and families, oversight entities, and the public.  
Hospital disclosure of adverse event information can be highly beneficial 
and is viewed by many stakeholders as an ethical obligation among 
health care providers.  However, disclosure can have legal ramifications 
for both patients and providers.  
Disclosure of adverse event information can assist patients in making 
decisions about care and pressure hospitals to improve patient safety 
Stakeholders indicated that public disclosure of adverse events by 
hospitals or oversight entities can provide benefits to patients.  Access 
to event information may allow patients to make informed decisions 
about treatment, and may also provide public scrutiny that could 
pressure hospitals to improve prevention practices.  IOM has promoted 
public disclosure as a principal goal of adverse event reporting, 
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particularly for the most serious adverse events.75  Most State reporting 
systems have traditionally released adverse event data received from 
hospitals, although in aggregate and deidentified form.76  At least one 
State provides a searchable Internet database that displays reported 
adverse events for individual hospitals.77  
Hospitals, clinicians, and patients can lose legal protections when 
adverse event information is reported outside the hospital   
Stakeholders indicated that legal liability can impose constraints on 
disclosure of adverse event information to outside reporting entities.   
In-hospital systems are typically subject to State legal provisions, 
known as peer review protections, which protect information shared 
within hospitals for quality improvement purposes.  This could include, 
for example, information disclosed in an adverse event report or 
discussed in meetings among hospital physicians and staff.   
However, this protection may be lost if information is transmitted 
outside an individual hospital.  Some outside systems allow for 
anonymous reporting to reduce the implication of individuals, but 
according to one stakeholder serving as a risk manager in a large urban 
hospital, this protection may not be useful if the event was serious and 
well-known.  Other reporting systems do not purport to maintain 
confidentiality, other than protecting the identity of patients, and in 
some cases publicly disclose adverse events.  Hospitals potentially 
report information to many entities, such as professional licensing and 
accrediting bodies, State health departments, and patients and families.  
This disclosure to many entities, which one stakeholder called a 
leaking sieve of information, can increase the likelihood that 
individual cases are known and result in loss of patient 
confidentiality.78   
 
75 L. T. Kohn, J. M. Corrigan, and M. S. Donaldson, eds., To Err is Human:  Building a 
Safer Health System.  A Report of the Committee on Quality of Health Care in America, 
Institute of Medicine, Washington, DC, National Academy Press, 1999. 
76 M. Marchev, Medical Malpractice and Medical Error Disclosure:  Balancing Facts and 
Fears, National Academy for State Health Policy, December 2003, p. 10.  Available online 
at http://www.nashp.org/Files/Medical_Malpractice_and_Medical_Error_Disclosure.pdf.  
Accessed on October 9, 2008. 
77 Adverse Health Events Reporting, Minnesota Department of Health, Database. 
Available online at http://www.health.state.mn.us/patientsafety/adverseselect.cfm.  
Accessed on October 9, 2008. 
78 Proposed PSO regulations at 73 Fed. Reg. 8112 (Feb. 12, 2008) would require that 
information reported to PSOs by providers receive significant legal protections through both 
legal privilege and confidentiality requirements.  
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Issue 6:  Information to help prevent adverse events is 
widely available, but some hospitals and clinicians may 
be slow to adopt or routinely apply recommended 
practices 
Information about methods to improve patient safety is considered 
readily accessible to clinicians and hospitals because of the efforts of 
active professional associations and government and private entities to 
improve health care quality.  There is substantial debate about which 
adverse events are considered preventable, but little question that the 
use of recommended guidelines can improve patient safety.  Current 
policy and practice, including CMSs nonpayment policy, hold hospitals 
accountable for conditions that could be reasonably prevented by using 
readily available evidence-based guidelines.79  Still, studies indicate 
that hospitals and clinicians may be slow to implement or to fully 
integrate recommended practices (such as evidence-based clinical 
practice guidelines).   
Strategies and guidelines to help prevent adverse events often focus on 
improving complex hospital systems and processes  
Patient safety research shows that some adverse events can be the 
result of breakdowns in systems as well as individual human error.80  
The systems approach to improving patient safety emphasizes the 
interaction between medical systems (e.g., protocols, devices, and 
infrastructure) and individual practitioners.  A systems approach 
advocates both improving the tools at the disposal of health care 
providers, such as by automating health records, providing clear 
medication labels, and creating checks to catch problems or errors 
before they cause harm.  (This approach aligns with the idea introduced 
previously of a just culture, aspiring to full disclosure of adverse 
events by focusing on systemic issues rather than individual blame.)   
The underpinning of this system approach is recognition of the 
complexity of modern health care and the difficulty even for highly 
trained clinicians of considering all information.  For example, one 
article describes a study that found patients in an intensive care unit 
 
79 DRA,  5001(c), P.L. No. 109-171 (adding Social Security Act,  1886(d)(4)(D)), 
provided for a quality adjustment in DRG payments for certain hospital-acquired 
conditions. 
80 R. M. Wachter, Understanding Patient Safety, McGrawHill, 2008, pp. 1726.  
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required an average of 178 different actions per day.81  As one clinician 
points out, the number of potential mistakes is so high and the potential 
impact is so great that even a 99.9 percent level of proficiency may not 
be adequate to ensure patient safety.  Stakeholders and literature gave 
examples of positive results from the systems approach, particularly 
when efforts addressed specific needs.  For example, anesthesiologists 
nationally have reduced the number of adverse events associated with 
administration of anesthesia by targeting and addressing systems 
breakdowns,82 and the Veterans Health Administration has reduced 
medication errors by as much as 86 percent by adopting medication 
barcoding.83   
Following recommended guidelines, which are readily accessible to 
hospitals and clinicians, can help prevent adverse events and improve 
quality of care  
As the issue of patient safety has gained prominence, a number of 
entities have targeted clinical solutions and recommended practices to 
improve safety and reduce the occurrence of certain adverse events.  
National entities have launched substantial patient safety efforts that 
focus on this technical assistance, including the following: 
  IOM identified 20 diseases and clinical conditions that may be 
significantly improved or effectively managed by using best practice 
treatment guidelines.84   
 
81 A. Gawande, Annals of Medicine:  The Checklist, The New Yorker, 83,          
December 10, 2007, pp. 8695.  Available online at 
http://www.newyorker.com/reporting/2007/12/10/071210fa_fact_gawande?printable=true.  
Accessed on October 10, 2008. 
82 D. M. Gaba, Anaesthesiology as a Model for Patient Safety in Health Care, BMJ, 
March 18, 2000, 320, pp. 785788.  Available online at 
http://www.bmj.com/cgi/content/full/320/7237/785.  Accessed on October 20, 2008.                
J. B. Cooper, An Analysis of Major Errors and Equipment Failures in Anesthesia 
Management:  Considerations for Prevention and Detection.  Abstract available online at  
http://www.ncbi.nlm.nih.gov/pubmed/6691595.  Accessed on October 20, 2008.   
83 M. Glabman, Health Plans Can Learn from VHA Turnaround:  While Plans, 
Hospitals, and Physician Groups Talk the Talk, the Veterans Health Administration is 
Walking the Walk, Managed Care Magazine, 16(2), February 2007, pp. 2629, 3436, and 
38.  Available online at 
http://www.managedcaremag.com/archives/0702/0702.veterans.html.  Accessed on       
August 28, 2008. 
84 K. Adams and J. M. Corrigan, eds., Committee on Identifying Priority Areas for 
Quality Improvement, Priority Areas for National Action:  Transforming Health Care 
Quality, Institute of Medicine, Washington, DC, 2003.  Available online at  
http://www.ahrq.gov/qual/iompriorities.htm.  Accessed on October 13, 2008. 
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  A patient safety advocacy group began providing free onsite 
assistance to hospitals launching safety interventions, including 
clinician assistance and analysis of results.85    
  AHRQ released 17 Patient Safety Toolkits that are publicly 
available and are designed to help practitioners, hospital managers, 
and patients reduce certain adverse events.86  
Evidence-based clinical practice guidelines, generated by systematic and 
evidentiary research, have been shown to be highly effective in preventing 
certain adverse events, particularly in the area of infection control.  
Statutory criteria for CMS selection of categories of hospital-acquired 
conditions for which hospitals would not be paid for more expensive DRGs 
include the provision that the conditions be reasonably preventable using 
readily available evidence-based guidelines.87  In many cases, such 
practices are straightforward and can be implemented with little or no 
cost.  For example, a study of hospital intensive care units found that 
using a checklist of safety steps when inserting central line catheters, 
including draping patients entire bodies instead of only affected areas, 
reduced the incidence of line infections nearly to zero, preventing an 
estimated 43 infections, and eight deaths, and saving nearly $2 million per 
hospital.88   
Some hospitals and clinicians can be slow to adopt or routinely apply 
recommended practices to prevent certain adverse events  
A number of studies indicate that hospital implementation of 
recommended practices can be slow and that not all guidelines are 
practiced widely.  For example, one study found that an average of        
17 years is needed before new knowledge generated through research 
becomes incorporated into widespread clinical practice.89  Further 
 
85 Institute for Healthcare Improvement, Overview of the Five Million Lives Campaign, 
2006.  Available online at 
http://www.ihi.org/IHI/Programs/Campaign/Campaign.htm?TabId=1.  Accessed on  
August 28, 2008. 
86 AHRQ, Patient Safety Tools:  Improving Safety at the Point of Care.  Program Brief.  
AHRQ Publication No. 08-P006, revised April 2008.  Available online at 
http://www.ahrq.gov/qual/pips/pstoolsbrf.htm.  Accessed on September 8, 2008. 
87 DRA, P.L. No. 109-171  5001(c), amends the Social Security Act,  1886(d)(4). 
88 S. M. Berenholtz, P. J. Pronovost, P. A. Lipsett, et al., Eliminating Catheter-Related 
Bloodstream Infections in the Intensive Care Unit, Critical Care Medicine, 32(10),    
October 2006, pp. 20142020.  Abstract available online at 
http://www.ncbi.nlm.nih.gov/pubmed/15483409.  Accessed on October 10, 2008. 
89 AHRQ, Closing the Quality Gap:  A Critical Analysis of Quality Improvement 
Strategies Fact Sheet, AHRQ Publication No. 04-P014, March 2004.  Available online at 
http://www.ahrq.gov/clinic/epc/qgapfact.htm.  Accessed on August 28, 2008. 
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research indicates that a large number of hospitals do not routinely 
practice all patient safety precautions.  As recently as 2001, AHRQ 
reported that a sample of hospitals did not routinely perform the          
11 interventions that researchers deemed most critical to improving 
patient safety, such as administering antibiotics prior to surgery.90  
Additionally, a survey of 1,256 hospitals in 2007 indicated that only      
25 percent followed all 27 safe practices guidelines established by NQF 
and only 13 percent followed all guidelines related to preventing 
common infections.91  Moreover, studies have shown that clinicians 
often do not comply with some of the most fundamental patient safety 
measures; one study found that hospital physicians wash their hands 
about half as often as is recommended while providing care.92   
One explanation for slow adoption of recommended guidelines is that 
some hospitals and clinicians may perceive guidelines as not being 
practical in the real world.  For example, although surgical units 
might count the number of sponges used during surgery to ensure that 
none is retained, in the case of an injured patient, ambulance and 
emergency room staff may employ an unknown number of sponges in 
stabilizing the patient prior to surgery.  Hospitals may also lack the 
infrastructure to implement new strategies, particularly if the strategy 
requires new technology.  Further, patient safety provisions may have 
countervailing implications, as in the example of limiting resident work 
hours.  Accreditation bodies set standards in 2003 to limit medical 
residents hours to 80 per week to combat fatigue,93 but one study found 
 
90 AHRQ, Making Health Care Safe:  A Critical Analysis of Patient Safety Practices, 
Chapter 57:  Practices Rated by Strength of Evidence, 2001.   Available online at 
http://www.ahrq.gov/clinic/ptsafety/.  Accessed on August 28, 2008. 
91  The Leapfrog Group, 41 Hospitals are Designated Leapfrog Top Hospitals for 2007, 
Significant Gaps in Safety and Quality Practices Among Other Hospitals Still the Norm, 
September 18, 2007.  Available online at 
http://www.leapfroggroup.org/media/file/Release_2007_Leapfrog_Survey_and_Top_Hospital
s_9-18.pdf.  Accessed on October 10, 2008.  The Leapfrog Group, 87 Percent of U.S. 
Hospitals Do Not Take Recommended Steps to Prevent Avoidable Infections,        
September 10, 2007.  Available online at 
http://www.leapfroggroup.org/media/file/Leapfrog_hospital_acquired_infections_release.pdf.  
Accessed on October 10, 2008. 
92 D. Pittet, A. Simon, S. Hugonnet, C. L. Pessoa-Silva, and V. Sauvan, Hand Hygiene 
Among Physicians:  Performance, Beliefs, and Perceptions, Annals of Internal Medicine, 
141(1), July 6, 2004, pp. 18.  Available online at 
http://www.annals.org/cgi/reprint/141/1/1.pdf.  Accessed on October 9, 2008. 
93 Accreditation Council for Graduate Medical Education, Common Program 
Requirements, Chapter VI:  Resident Duty Hours in the Learning and Working 
Environment, updated February 2007, effective July 1, 2007.  Available online at  
http://www.acgme.org/acWebsite/dutyhours/dh_ComProgrRequirmentsDutyHours0707.pdf.  
Accessed on October 9, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  31   
   
KK EE YY    II SS SS UU EE SS   
that clinicians perceive limiting shift lengths can cause a greater 
incidence of medical errors resulting from loss of continuity in care.94   
Studies also indicate that clinicians may also be slow to incorporate 
lessons from their own experiences, treating adverse events as isolated 
incidents and arguing that individual practitioner ingenuity is more 
important than regimented standards of care.95  Researchers explain 
that these clinicians may also believe that systems improvements, such 
as computerized decision support systems, can suppress the knowledge, 
experience, and judgment of the practitioner.  Adding to this, physicians 
are usually independent of the hospital and may not have to meet 
hospital training or operational standards.   
 
____________________________  
Issue 7:  Interviews and literature reveal strategies that 
may accelerate progress in reducing the incidence of 
adverse events in hospitals 
Stakeholders described the current environment among hospitals and 
policymakers as being on the verge of accelerating progress and 
indicated that with continued focus, hospitals can reduce the overall 
incidence of adverse events and improve quality of care.  Information 
from interviews and literature suggests the following strategies:   
  Assessing the desirability and feasibility of a national body to lead 
patient safety efforts.  This could entail evaluating the impact of 
involved organizations and determining what tasks a national 
coordinating body might perform.  Stakeholders described adverse 
events as a public health issue that demands an aggressive agenda 
and active policy enforcement.  They indicated that current efforts 
 
94 J. S. Myers, L. M. Bellini, J. B. Morris, et al., Internal Medicine and General Surgery 
Residents Attitudes About the ACGME Duty Hour Regulations:  A Multi-Center Study,  
Academic Medicine, 81(12), December 2006, pp. 10171020.  Available online at 
http://www.academicmedicine.org/pt/re/acmed/pdfhandler.00001888-200612000-
00008.pdf;jsessionid=LyBMNyx0pk10K8sRJs2DmTQD5DPJRQXSnjtJrS7yrGmdv7LKhXgl!
475884353!181195629!8091!-1.  Accessed on October 9, 2008. 
95 F. B. Garfield and J. M. Garfield, Clinical Judgment and Clinical Practice 
Guidelines, International Journal of Technology Assessment in Health Care, 16, 2000,    
pp. 10501060.  Abstract available online at 
http://www.ncbi.nlm.nih.gov/pubmed/11155827.  Accessed on October 13, 2008.                    
S. J. Genuis, The Proliferation of Clinical Practice Guidelines:  Professional Development 
or Medicine-by-Numbers, Journal of the American Board of Family Medicine, 18(5), 
SeptemberOctober 2005, pp. 419425.  Available online at 
http://www.jabfm.org/cgi/reprint/18/5/419.  Accessed on October 13, 2008. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  32   
   
K E Y   I S S U E S  
by government agencies and private entities are necessary and 
useful but may not be sufficient to ensure patient safety; and that a 
national body could coordinate, but not replace, these efforts.   
  Focusing on hospital use of recommended practices and       
evidence-based clinical practice guidelines to reduce the incidence of 
adverse events, including further promulgating these practices, 
measuring hospital use, and improving information sharing.   
  Establishing methods for measuring the incidence of adverse events, 
including a practical and accurate data collection method for routine 
measurement.  
  Expanding the use of electronic health records within and among 
hospitals and other health care settings.  Stakeholders reported that 
widespread use of electronic health records would enhance 
communication, improving continuity of care and potentially 
reducing the incidence of adverse events.  
  Monitoring and analyzing the impact of policies to deny hospitals 
higher payment for admissions complicated by selected adverse 
events, including hospital and payer implementation, the incidence 
of adverse events, access to health care, and health care costs.  
  Improving the utility of adverse event reporting to outside entities, 
including evaluating the comparability of data reported across 
entities and streamlining reporting mechanisms to reduce burdens 
to hospitals. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  33   
   
 S U M M A R Y  
 
Our interviews with stakeholders and review of literature indicate that 
the incidence of adverse events poses a problem in hospitals, 
particularly among the elderly.  A number of barriers exist to reducing 
the incidence of adverse events, including confusion over how adverse 
events are defined and identified, underreporting of events, and legal 
concerns regarding the disclosure of events.  Further, challenges 
associated with accurately measuring the incidence of adverse events 
make it difficult to assess progress and to direct future research and 
policy efforts.     
The extensive range of entities involved in researching and addressing 
adverse events indicates that solving the problem is a high priority for 
policymakers, patients, and providers.  Stakeholders described the 
current environment among hospitals and policymakers as being on the 
threshold of accelerated progress and said that with continued focus, 
hospitals can reduce the incidence of adverse events and improve 
quality of care.  They point to a large body of clinical and policy research 
that has improved the understanding of adverse events, including 
recognition of the critical role of hospital systems in guarding against 
them.  Additionally, new policies, such as nonpayment for care 
associated with adverse events and public disclosure of events, 
strengthen hospitals incentives to develop safer practices.  These 
advancements in clinical understanding, combined with heightened 
controls, hold promise for reducing the incidence of adverse events in 
hospitals and improving the quality of care.       
This overview of key issues is one of a series of OIG reports designed to 
respond to the congressional mandate to inform Congress about policies 
and practices critical to addressing adverse events.  Other OIG studies 
focus on estimating the incidence of adverse events among Medicare 
beneficiaries, State efforts to operate adverse event reporting systems, 
Medicare beneficiaries receiving potentially inappropriate drug pairs 
that may reflect medication errors, and hospital actions to address and 
prevent adverse events.   
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  34   
   
 A G E N C Y   C O M M E N T S  
 
We received comments on a draft of this report from AHRQ and CMS. 
AHRQ concurred with the reports findings.   
CMS commended OIG on succinctly capturing the numerous issues 
surrounding this complex topic, acknowledged technical assistance 
provided to OIG in conducting this study, and indicated that it 
welcomed continued work with OIG on this issue.   
CMS reiterated its policies to encourage the prevention of adverse 
events that are enumerated in the report, including quality 
measurement and reporting, financial initiatives, and program 
oversight.  Regarding financial incentives, CMS outlined the provision 
to deny payment for care associated with hospital-acquired conditions, 
noting that OIGs work is supportive of and will enable more effective 
CMS implementation of the provision.  CMS agreed with the reports 
conclusion that nonpayment for care associated with adverse events 
strengthens hospitals incentives to develop safety practices and reduces 
health care costs in the long term. 
CMS also addressed the three potential drawbacks of nonpayment 
policies raised by stakeholders:  limiting access to care, increasing 
hospital costs, and changes in hospital revenue.  CMS indicated that it 
will monitor the impact of implementation of the nonpayment provision 
but believes that these drawbacks are unlikely to occur.  CMS provided 
further discussion to support this viewpoint, stating that more precise 
payment for high-risk patients will likely offset incentives to limit 
access to care, increased hospital costs to implement safety provisions 
will likely be offset by savings resulting from fewer complications, and 
decreases in hospital revenue will likely be minimal because CMS will 
continue to assign a discharge to a higher paying MS-DRG if the 
selected hospital-acquired condition is present on admission.   
For the full text of AHRQ and CMS comments, see Appendix G. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  35   
   
 A P P E N D I X   ~   A  
 
TAX RELIEF AND HEALTH CARE ACT OF 200696 
P.L. No. 109-432 
 
DIVISION B  MEDICARE AND OTHER HEALTH PROVISIONS 
TITLE IIMEDICARE BENEFICIARY PROTECTIONS 
SEC 203 OIG STUDY OF NEVER EVENTS 
 
(a) Study. 
(1) In general.The Inspector General in the Department of Health and Human 
Services shall conduct a study on 
(A) incidences of never events for Medicare beneficiaries, including types of such 
events and payments by any party for such events; 
(B) the extent to which the Medicare program paid, denied payment, or recouped 
payment for services furnished in connection with such events and the extent to 
which beneficiaries paid for such services; and 
(C) the administrative processes of the Centers for Medicare & Medicaid Services 
to detect such events and to deny or recoup payments for services furnished in 
connection with such an event. 
(2) Conduct of study.In conducting the study under paragraph (1), the 
Inspector General 
(A) shall audit a representative sample of claims and medical records of Medicare 
beneficiaries to identify never events and any payment (or recouping of payment) 
for services furnished in connection with such events; 
(B) may request access to such claims and records from any Medicare contractor; 
and 
(C) shall not release individually identifiable information or facility-specific 
information. 
(b) Report.Not later than 2 years after the date of the enactment of this Act, the 
Inspector General shall submit a report to Congress on the study conducted 
under this section.  Such report shall include recommendations for such 
 
96 Tax Relief and Health Care Act of 2006, P.L. No. 109-432, Division B, Title II,  203, 
December 16, 2007. 
 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  36   
   
A P P E N D I X   ~   A  
legislation and administrative action, such as a noncoverage policy or denial of 
payments, as the Inspector General determines appropriate, including 
(1) recommendations on processes to identify never events and to deny or recoup 
payments for services furnished in connection with such events; and 
(2) a recommendation on a potential process (or processes) for public disclosure of 
never events which 
(A) will ensure protection of patient privacy; and  
(B) will permit the use of the disclosed information for a root cause analysis to 
inform the public and the medical community about safety issues involved. 
(c) Funding. Out of any funds in the Treasury not otherwise appropriated, 
there are appropriated to the Inspector General of the Department of Health and 
Human Services $3,000,000 to carry out this section, to be available until 
January 1, 2010. 
(d) Never Events Defined.For purposes of this section, the term never event 
means an event that is listed and endorsed as a serious reportable event by the 
National Quality Forum as of November 16, 2006. 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  37   
   
 A P P E N D I X   ~   B  
GLOSSARY OF SELECTED TERMS97 
 
Adverse eventAny harm (injury or illness) caused by medical care.  Identifying 
adverse events indicates that the care resulted in an undesirable clinical outcome 
and that the clinical outcome was not caused by an underlying disease, but does 
not imply an error, negligence, or poor quality care. 
Corrective action planPolicy and procedural actions that hospitals prepare to 
respond to an adverse event and to prevent recurrence.  
Evidence-based clinical practice guidelinesPractices found to increase patient 
safety and improve care, generated by systematic and evidentiary research. 
Hospital-acquired conditionMedical condition not present prior to admission to 
a hospital.   
Just cultureAn environment in which personnel feel comfortable disclosing 
errors (including their own) while maintaining professional accountability; 
purports that individuals should not be held responsible for systems breakdowns.  
Medical errorThe failure of a planned action to be completed as intended or the 
use of a wrong plan to achieve an aim.    
Near missAn event or a situation that did not produce patient harm, but only 
because of intervening factors, such as patient health or timely intervention. 
Never eventAn event or a situation that should never occur in a health care 
setting.  The National Quality Forum initially used the term never events to 
describe its list of serious events but began in 2005 to refer to the list as serious 
reportable events.  
Patient safetyFreedom from accidental or preventable injuries caused by 
medical care. 
Root cause analysisA focused review of systems and processes to identify the 
basic or contributing factors that cause adverse events.   
Systems approachTheory that most errors reflect predictable human failings in 
the context of poorly designed systems. 
 
97  Definitions derived from a variety of sources, including L. T. Kohn, J. M. Corrigan, 
and M. S. Donaldson, eds, To Err is Human:  Building a Safer Health System.  A Report of 
the Committee on Quality of Health Care in America, Institute of Medicine,  Washington, 
DC, National Academy Press, 1999; R. M. Wachter, Understanding Patient Safety, 
McGrawHill, 2008; and the glossary of the Agency for Healthcare Research and Quality 
Patient Safety Network.  Available online at http://www.psnet.ahrq.gov/glossary.aspx.  
Accessed on October 10, 2008.    
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  38   
   
 A P P E N D I X   ~   C  
National Quality Forum Serious Reportable Events98 
The National Quality Forum (NQF) list is separated into six categories. 
Serious disability is defined as loss of a body part, disability, or loss of bodily 
function lasting more than 7 days or still present at time of discharge.     
Table C1:  The National Quality Forum List of Serious Reportable Events 
Surgical Events   
A.   Surgery performed on the wrong body part 
B.   Surgery performed on the wrong patient 
C.   Wrong surgical procedure performed on a patient 
D.   Unintended retention of foreign object in a patient after surgery or procedure 
E.   Intraoperative or immediately postoperative death 
Product or Device Events 
A.   Patient death or serious disability associated with the use of contaminated drugs, devices, or biologics provided by the health care facility 
B.   Patient death or serious disability associated with use or function of a device in patient care in which the device is used or functions other than as    
intended 
C.   Patient death or serious disability associated with intravascular air embolism that occurs while being cared for in a health care facility 
Patient Protection Events 
A.   Infant discharged to the wrong person 
B.   Patient death or serious disability associated with patient elopement 
C.   Patient suicide, or attempted suicide resulting in serious disability while being cared for in a health care facility 
Care Management Events 
A.   Patient death or serious disability associated with a medication error 
B.   Patient death or serious disability associated with a hemolytic reaction due to administration of ABO/HLA-incompatible blood or blood products 
C.   Maternal death or serious disability associated with labor or delivery in a low-risk pregnancy while being cared for in a health care facility 
D.   Patient death or serious disability associated with hypoglycemia, the onset of which occurs while patient is cared for in a health care facility 
E.   Death or serious disability associated with failure to identify and treat hyperbilirubinemia in neonates 
F.   Stage 3 or 4 pressure ulcers acquired after admission to a health care facility 
G.   Patient death or serious disability due to spinal manipulative therapy 
H.   Artificial insemination with the wrong donor sperm or wrong egg 
Environmental Events 
A.   Patient death or serious disability associated with an electric shock while being cared for in a health care facility 
B.   Any incident in which a line designated for oxygen or other gas to be delivered to a patient contains the wrong gas or is contaminated by  toxic 
substances 
C.   Patient death or serious disability associated with a burn incurred from any source while being cared for in a health care facility 
D.   Patient death or serious disability associated with fall while cared for in a health care facility 
E.   Patient death or serious disability associated with the use of restraints or bedrails while being cared for in a health care facility 
Criminal Events 
A.   Care provided by someone impersonating a health care provider 
B.   Abduction of a patient of any age 
C.   Sexual assault on a patient within or on the grounds of a health care facility 
D.   Death or significant injury resulting from a physical assault that occurs within or on the grounds of the facility 
 
98 NQF, Serious Reportable Events in Healthcare 2006 Update:  A Consensus Report, 
NQF, Washington, DC, 2007, p. 7.  Available online at 
http://www.qualityforum.org/pdf/reports/sre/txsrepublic.pdf.  Accessed on October 10, 2008.   
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  39   
   
 A P P E N D I X   ~   D  
I N T R O D U C T I O N  
  List of Stakeholders Interviewed 
We identified stakeholders using a variety of sources, including referrals from AHRQ, 
the National Patient Safety Foundation, the Joint Commission, and others, as well as 
contacts references in literature.  The viewpoints of the individuals we interviewed do 
not represent official positions of their organizations. 
 Table D1List of Stakeholder Interview Respondents 
Federal Agencies 
Agency for Healthcare Research and Quality (AHRQ), Center for Quality Improvement & Patient Safety (C-QUIPS) 
Centers for Medicare & Medicaid Services (CMS), Medicare Management Services 
Centers for Medicare & Medicaid Services (CMS), Quality Improvement Group 
Centers for Disease Control and Prevention (CDC)  
Department of Defense, Patient Safety Center (DOD) 
Food and Drug Administration (FDA) 
National Institutes of Health (NIH) 
Veterans Affairs (VA), National Center for Patient Safety (NCPS) 
State Agencies 
California Department of Health 
Georgia Department of Health and Human Services 
Minnesota Department of Social Services 
Pennsylvania Department of Health 
Professional Associations 
American Medical Association (AMA) 
American Hospital Association (AHA) 
American Health Lawyers Association (AHLA) 
American Health Quality Association (AHQA) 
American Nurses Association (ANA) 
Anesthesia Patient Safety Foundation (APSF) 
American Society for Healthcare Risk Management (ASHRM) 
American Society of Health-System Pharmacists (ASHP) 
Georgia Hospital Association:  Partnership for Health and Accountability (PHA) 
Minnesota Hospital Association (MHA) 
Oversight/Standard-Setting Organizations 
Federation of State Medical Boards of the U.S., Inc. (FSMB) 
Leapfrog Group for Patient Safety 
The Joint Commission 
National Committee on Quality Assurance (NCQA) 
U.S. Pharmacopeia (USP) 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  40   
A   P P E N  D I X   ~   D  
 
 
Table D1List of Stakeholder Interview Respondents (continued) 
Patient Safety Advocacy Groups 
American Association of Retired Persons (AARP) 
Center for Medical Consumers 
Consumers Advancing Patient Safety (CAPS) 
Consumers Union 
Mothers Against Medical Errors (MAME) 
Partnership for Patient Safety 
Persons United Limiting Substandard Care and Errors in Healthcare (PULSE) 
Public Policy Groups 
Institute for Healthcare Improvement (IHI) 
Institute of Medicine (IOM) 
Massachusetts Coalition for the Prevention of Medical Errors 
National Academy for State Health Policy (NASHP) 
National Association for Healthcare Quality (NAHQ) 
National Patient Safety Foundation (NPSF) 
National Quality Forum (NQF) 
Urban Institute 
World Health Organization (WHO) 
Private Payers 
Managed Care Organizations4 selected national and regional organizations  
Providers 
Hospitals20 selected hospitals in CA, FL, GA, KS, IL, MA, MN, NY, and PA 
Networks8 selected organizations 
Researchers associated with the following organizations 
Columbia UniversityNational Heart, Lung and Blood Institute (MERS  TH) 
Harvard School of Public Health 
Johns Hopkins University 
University of CaliforniaSan Francisco 
University of Chicago 
Service Contractors 
Cardinal Health, Inc. 
CRG Medical, Inc., Patient Safety Quality Management Solutions 
Emergency Care Research Institute (ECRI), Inc. 
Qualidigm, Inc. 
University HealthSystem Consortium, Patient Safety Net (UHC/PSN) 
Source:  Office of Inspector General data collection, October 2007April 2008. 
 
 
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  41   
   
 A P P E N D I X   ~   E  
 
Examples of Data Analysis:  Stakeholder Interviews and Literature 
Review 
Summary statements represent the predominant viewpoint of the 78 stakeholder 
entities that we interviewed as well as analysis from literature.  The text of the 
report does not include the proportion of sources that contributed to summary 
statements for three reasons:   
  Interview respondents represent a wide variety of entities and interests that 
are not easily grouped to provide a sum of responses.  For example, entities 
included group interviews with representatives from large national 
organizations as well as individual interviews with hospital staff and 
researchers.  
  Interviews and literature often entailed nuanced discussions of complex 
issues, and analysis of the resulting data could not be accurately quantified.  
In these cases, the report summarizes the range of viewpoints and provides 
relevant examples.   
  Not all interview respondents chose to or were able to answer each question, 
changing the number of potential responses throughout the report.  For 
example: 
o  Ten interview respondents declined to respond regarding whether the 
current incidence of adverse events remains at the level reported by the 
Institute of Medicine (IOM), indicating that it would not be useful for 
them to speculate and that they were unaware of any accurate 
measurement. 
o  The Centers for Medicare & Medicaid Services nonpayment policy was 
finalized only 2 months prior to our data collection period, and 
representatives from 11 entities declined to respond because they did not 
believe they were adequately informed to state an opinion. 
o  In some cases, interview respondents provided information and insight 
based on the occurrence of adverse events in all health care settings as 
opposed to only the hospital setting.   
Table E1 on page 42 includes examples of our analysis of interviews and 
literature to arrive at summary statements.  Although the frequencies represent 
the general opinions of the interview respondents, further related discussion 
often provided additional insight.  The report presented this additional insight 
when it represented a prominent alternative view or otherwise aided 
understanding.    
    
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  42   
   
A P P E N D I X   E  
 
 
Table E1.  Data Analysis of Stakeholder Interviews and Literature Review 
 
Summary Statements  Page  Interview Questions  Interview Responses 
Stakeholders perceive that the incidence of  11  What do you perceive  Incidence similar = 63  
adverse events remains that reported by the  is the current incidence  Substantial progress =  5 
Institute of Medicine in 1999  of adverse events in 
(n = 68) 
hospitals? 
Stakeholders view nonpayment policies for  16  What impact do you  Primarily positive impact = 65 
adverse events as a powerful incentive to  anticipate will result  Primarily negative impact = 2 
improve care   from nonpayment 
(n = 67) 
policies for adverse 
events in hospitals?  
Hospitals rely on staff and managers to  19  How does your hospital  Hospital staff report to risk managers or quality 
report adverse events internally  identify adverse  assurance departments = 20 
events?  (n = 20) 
Stakeholders suspect substantial  22  What proportion of  Only a portion of events (underreporting) = 72 
underreporting of adverse events to outside  adverse events do you  All events are reported (no underreporting) = 1 
entities  perceive are reported? 
(n = 73) 
 
Information about preventing adverse  28  What are the barriers 
Most prominenthospitals do not routinely use 
events is widely available, but hospitals do  to progress in reducing 
guidelines to increase safety = 43  
not always apply this knowledge  adverse events in 
hospitals?  (n = 78) 
 
Suggested Policy Strategies to Accelerate Progress (n = 78)  
 
Assessing the desirability and feasibility of  What suggestions do  Consider national entity to coordinate efforts 
33 
creating a national oversight organization  you have for  and/or provide oversight = 37 
accelerating progress 
Focusing on hospital use of guidelines to  in reducing adverse  Further encourage or require hospital adherence 
reduce events  events in hospitals?   to recommended practices = 35 
Establishing methods for determining    Improve methods for measuring progress = 21 
incidence 
Expanding use of electronic health records  Facilitate use of electronic health records = 20 
Measuring and analyzing the impact of  Assess the impact of nonpayment policies = 15 
nonpayment policies 
Improving the utility of adverse event  Improve adverse event reporting systems = 12 
reporting systems 
Source:  Office of Inspector General analysis of 78 stakeholder interviews and 117 published works, October 2007April 2008.  
  OEI-06-07-00470  ADVERSE EVENTS IN HOSPITALS:  OVERVIEW OF KEY ISSUES  43   
  A P  P E N D I X   ~   F  
 
Examples of Research:  Incidence of Adverse Events 
These examples represent a range of adverse events research using a 
variety of data collection methods.  In some cases, the objectives of the 
research were other than deriving a measure of incidence. 
 
 
Table F1.  Incidence Rate of Adverse Events and Related Research Information 
 
       
Population Studied  Incidence Rate  Method  Summary 
General hospital  3.7%  Medical record  Clinical reviews of 30,000 medical records from hospitalizations in 
admissions1  review  New York.  Cited in the Institute of Medicine (IOM) report, To Err is 
Human:  Building a Safer Health System.    
General hospital  17.7%  Observation  Qualitative observational study of 1,047 patients at a large urban 
admissions2  hospital.  The risk for an adverse event increased by 6 percent for 
each day spent at the hospital.  
General hospital  2.9%  Medical record  Clinical reviews of 15,000 medical records from hospitalizations in 
admissions3   review  Colorado and Utah.  Cited in the IOM report, To Err is Human:  
Building a Safer Health System.      
General hospital  8.0%  Medical record  Study of 228 patients included review of medical records and 
admissions4  review and patient  interviews with patients.   
interview 
Intensive care  20.2%  Observation  Study of 391 critically ill patients in yearlong review.  Forty-five 
admissions5  percent of all adverse events were preventable; 55 percent  were 
nonpreventable. 
General hospital  9.0%  Hospital incident  Study of 1,000 incident reports at two hospitals.  Nine percent of 
admissions6  reports  patients had at least one incident report, primarily medication 
administration incidents. 
1 T. A. Brennan, L. L. Leape, N. M. Laird, et al., Incidence of Adverse Events and Negligence in Hospitalized Patients:  Results of the Harvard Medical Practice      
Study 1, New England Journal of Medicine, 324(6), 1991, pp. 370376.  Abstract available online at http://content.nejm.org/cgi/content/abstract/324/6/370.  Accessed on   
October 10, 2008. 
2 L. B. Andrews, C. Stocking, T. Krizek, et al., An Alternative Strategy for Studying Adverse Events in Medical Care, Lancet, 349(9048), February 1997, pp. 309313.  
Abstract available online at http://www.ncbi.nlm.nih.gov/pubmed/9024373.  Accessed on October 10, 2008. 
3 E. J. Thomas, D. M. Studdert, H. R. Burstin, et al., Incidence and Types of Adverse Events and Negligent Care in Utah and Colorado, Medical Care, 38(3), 2000,   
pp. 261271.  Abstract available online at http://www.ncbi.nlm.nih.gov/pubmed/10718351.  Accessed on October 10, 2008. 
4 S. N. Weingart, O. Pagovich, D. Z. Sands, et al., What Can Hospitalized Patients Tell Us about Adverse Events?  Learning from Patient-Reported Incidents, Journal 
of General Internal Medicine, 20(9). 2005, pp. 830836.  Abstract available online at  http://www.ncbi.nlm.nih.gov/pubmed/16117751.  Accessed on October 10, 2008. 
5 J. M. Rothschild, C. P. Landrigan, J. W. Cronin, et al., The Critical Care Safety Study:  The Incidence and Nature of Adverse Events and Serious Medical Errors in 
Intensive Care, Critical Care Medicine, 33(8), August 2005, pp. 16941700.  Abstract available online at http://www.ncbi.nlm.nih.gov/pubmed/16096443.  Accessed on 
October 10, 2008. 
6 T. K. Nuckols, D. S. Bell, and H. Liu, Rates and Types of Events Reported to Established Incident Reporting Systems in Two U.S. Hospitals," by Teryl K. Nuckols, 
M.D., Douglas S. Bell, M.D., Honghu Liu, Ph.D., et al., in the June 2007 Quality & Safety in Health Care 16, pp. 164168.   Abstract available online at 
http://qshc.bmj.com/cgi/content/abstract/16/3/164.  Accessed on October 10, 2008. 
Source:  Office of Inspector General analysis of published works, October 2007April 2008. 
 
 
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 A P P E N D I X   ~   G  
Agency Comments:  Agency for Healthcare Research and Quality 
 
 
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A  P P E N D I  X   G  
 
   Agency Comments: Center for Medicare & Medicaid Services 
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 A A PP PP EE NN DD II  XX    GG   
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 A C K N O W L E D G M E N T S  
This report was prepared under the direction of Kevin K. Golladay, 
Regional Inspector General for Evaluation and Inspections in the Dallas 
regional office, and A. Blaine Collins, Deputy Regional Inspector 
General for Evaluation and Inspections.   
Ruth Ann Dorrill served as the team leader for this study.  Other 
principal Office of Evaluation and Inspections staff from the Dallas 
regional office who contributed to this report include Amy Ashcraft, 
Deborah Cosimo, Anthony Guerrero-Soto, Margaret Knight, Christi 
Macrina, Jeremy Moore, and Lyndsay Patty; central office staff who 
contributed to this report include Alan Levine, Ayana Everett, Mark 
Richardson, and Rita Wurm.    
 
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