Find-A-Code Focus Newsletter

Hospital-Acquired Conditions (HAC) in Acute Inpatient Prospective Payment System (IPPS) Hospitals

October 24, 2014

The Deficit Reduction Act of 2005 (DRA) requires a quality adjustment in Medicare Severity Diagnosis Related Group (MS-DRG) payments for certain hospital-acquired conditions. CMS has titled the provision “Hospital-Acquired Conditions and Present on Admission Indicator Reporting” (HAC & POA).

Read more about it here: Medicare learning network fact sheet, ICN 901045 October 2012

Affected Hospitals

The Hospital-Acquired Conditions payment provision applies only to IPPS hospitals. At this time, the following hospitals are EXEMPT from the HAC payment provision:

  • Critical Access Hospitals (CAHs),
  • Long-Term Care Hospitals (LTCHs),
  • Maryland Waiver Hospitals,
  • Cancer Hospitals, Children’s Inpatient Facilities,
  • Rural Health Clinics,
  • Federally Qualified Health Centers (FQHCs),
  • Religious Non-Medical Health Care Institutions,
  • Inpatient Psychiatric Hospitals,
  • Inpatient Rehabilitation Facilities (IRFs), and
  • Veterans Administration/Department of
  • Defense Hospitals

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