Alomere Health has had to forfeit $242,000 in federal payments this year - much of that because of infections affecting very few of its patients.

In June, hospital officials learned they were ranked in the bottom quartile of hospitals around the country when it came to patients developing urinary tract infections caused by catheters. Federal health privacy laws prevent them from releasing exactly how many patients developed these infections, but Medicare rankings indicate just one or two affected patients could have triggered the penalty.

Still, "We take this to heart," said Emmalea Von Felden, infection control officer for the county-owned hospital.

"We don't even like one infection," said Bonnie Freudenberg, Alomere's director of quality and risk management.

At issue is the way the Centers for Medicare and Medicaid Services reimburses hospitals for patient costs. Several years ago, as a way to rein in costs and improve patient care, the federal agency began singling out various areas for improvement. Hospitals that didn't improve, or didn't improve as much as other hospitals in those areas, were penalized, while those who did well received financial incentives.

Among those problem areas were urinary tract infections caused by catheters. Catheters were once commonly used in hospitals, and infections occurred as a result, said Dr. Deborah Dittberner, Alomere's chief medical officer.

Hospitals recognized the problem and have been largely moving away from using catheters, she said. The problem now, Dittberner said, is that hospitals everywhere have gotten so skilled at avoiding infection that even one or two cases can trigger a penalty.

And preventing those cases can be challenging.

Catheters become necessary to measure fluid levels of patients with congestive heart failure, for women undergoing Cesarean sections, and for those unable to urinate, among other cases.

Sometimes, providers are forced to choose between using a catheter or forcing an elderly or unsteady patient to use the bathroom and risk a fall. Other hospitals faced penalties for too many falls, Dittberner pointed out.

"We didn't get that one," she said.

The hospital has taken steps to reduce catheter infections still further. It is testing a new device to collect urine from female patients that is less invasive and therefore less likely to cause infection, and it is also continually educating staff about their proper use.

Alomere was one of seven hospitals in Minnesota to see Medicare and Medicaid payments reduced during the 2017-2018 fiscal year. Its penalty for infections was about $195,000, while it faces an additional penalty of about $47,000 for its rate of hospital readmissions within 30 days of discharge. This rate, too, was too low to disclose actual numbers because of privacy laws, officials said.

Readmission numbers are several years old and since then, a hospital committee reviewed every readmission file to determine what could be done to prevent patients from requiring additional hospital stays. Hospitals have objected to this measure, since they get penalized for situations out of their control. For instance, if a patient has a total knee replacement at Alomere Health, then three weeks later gets into a car wreck that requires another hospital stay, that counts against Alomere.

However, the federal strategy has been useful in accelerating necessary changes, Dittberner said. She expects that in coming years, hospitals will have improved so much in problematic areas that the federal agency will find other areas to measure.

The penalty amount - which could still change somewhat - isn't large enough to hurt the hospital, which operates on a $160 million budget, said communications director Eddie Reif. But it's enough to be noticed.

And partly, the shortfall is made up in other areas where the hospital has outperformed expectations.

During this same year, it will also receive a financial reward of $31,000 - for bringing down its purchasing costs - from the Centers for Medicare and Medicaid Services, the same agency that imposed the fine.

Dittberner said that despite the penalty, Alomere Health consistently earns high marks from watchdog groups. It outperformed much larger hospitals in providing mammograms for low-income women, she said. And indeed, the federal agency has awarded Alomere Health a full five stars for quality.