CMS Final Rule will Prohibit Medicaid Payments for Preventable Healthcare-Acquired Conditions

On June 1, 2011, the Centers for Medicare & Medicaid Services (CMS) issued a final rule prohibiting states from paying providers under Medicaid for healthcare-acquired conditions. This final rule implements Section 2702 of the Patient Protection and Affordable Care Act of 2010 (Pub. L. 111-148; the Affordable Care Act), which requires that regulations be issued effective as of July 1, 2011, to prohibit federal payment to states under Section 1903 of the Social Security Act for any amounts expended in providing medical assistance for certain healthcare-acquired conditions. This new rule, in effect, prohibits states from paying providers under Medicaid for certain, reasonably preventable conditions. The regulations set forth under this final rule represent the latest in efforts to improve quality of care for federal health program beneficiaries. The following provides a brief description of two earlier regulatory initiatives, both of which are discussed in the preamble to the final rule.

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