Medicare is penalizing 751 hospitals for high rates of hospital-acquired conditions (HACs) as part of the HAC Reuction program ("HAC program"). This represents 22.7% of the 3,306 hospitals participating in HAC program.  The HAC program, which began in fiscal year 2015, was set forth by Section 1886(p)(6)(B) of the Social Security Act, and is designed to improve patient safety by encouraging reductions in HACs and health care associated infections.

Hospitals in the worst-performing quartile of performance on a combination of 15 quality measures are subject to a one percent payment reduction for all . . .

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