Hospital-Acquired Condition (HAC) Reduction Program
The Hospital-Acquired Condition (HAC) Reduction Program is a CMS program that lowers Medicare payments to hospitals ranking worst on rates of preventable harms like infections and injuries, financially encouraging improvements in patient safety practices.
What is the Hospital-Acquired Condition (HAC) Reduction Program?
The Hospital-Acquired Condition (HAC) Reduction Program is a Medicare payment program that penalizes hospitals with the highest rates of avoidable patient harm. Hospitals that fall into the worst-performing group on a composite of safety measures have their Medicare payments reduced by a set percentage for the applicable year.
Scoring generally combines measures of patient safety indicators with rates of healthcare-associated infections drawn from national surveillance data. Because the penalty applies only to the lowest-ranked facilities, the program functions as a relative comparison rather than an absolute threshold.
Why is the HAC Reduction Program important?
By attaching a financial penalty to preventable complications, the program gives hospitals a strong incentive to strengthen infection control, fall prevention, and overall safety culture. The reputational weight of being publicly identified as a poor performer adds further pressure to improve.
The program reinforces a principle that extends to every surgical setting: harm that could have been prevented carries both clinical and financial consequences. Ambulatory surgery centers operate under different rules, but the same emphasis on documented, demonstrable safety shapes how outpatient surgery is judged.
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