Anthem Blue Cross and Blue Shield, Virginia's largest private insurer, is rolling out a new policy that would leave the state's hospitals to pay the bill for certain preventable surgical errors.

While its no-pay list is not as expansive as the one set by Medicare to take effect this fall, Anthem will hold back payment for four core surgical mishaps: operating on the wrong body part; performing the wrong procedure on a patient; leaving medical supplies inside a patient; and operating on the wrong patient.

In health care parlance, such errors are often referred to as "never events" because they are so costly and egregious they should never happen. Medical experts say, for the most part, such events during surgery are rare.

"It was our intent to put these into our contracts to raise the profile on patient safety," said Dr. Jay Schukman, lead medical director for Anthem in Virginia. "That's the main issue."

The policy change is being written into hospital contracts as they are renewed in Virginia this year, Anthem officials said.

So far, 13 of the 90 or so hospitals it contracts with have made the switch in what the insurer has described as a pilot program it hopes to eventually expand to other states where the company has Blue-licensed subsidiaries. The change will also become effective in physician contracts April 1.

Anthem's new policies include nursing homes

Anthem, which is the main provider of health insurance in the Roanoke Valley, is a subsidiary of WellPoint Inc. with 2.9 million clients in Virginia -- about 37 percent of the state's privately insured.

The insurer is also taking its policy one step further than Medicare. In Virginia, Anthem says it will no longer pay nursing homes for the deep-cutting pressure ulcers or bedsores acquired during a patient's stay.

Some long-term care advocates, however, say the measure is likely to have a minimal effect.

The majority of nursing home reimbursements come from Medicare, Medicaid and private pay, said Steve Morrisette, president of the Virginia Health Care Association, a long-term care advocacy group in Richmond. He estimated that between 1 percent and 2 percent of nursing home residents in Virginia are covered by private insurers.

Officials at Anthem say their efforts to curb medical errors predate the Medicare announcement, but the insurer will be watching the federal program closely to see how it implements changes on a national level.

Beginning Oct. 1, Medicare will no longer reimburse for eight largely preventable hospital errors, including bedsores, catheter-caused urinary tract infections and giving patients the wrong blood type.

Anthem officials say they plan to add more errors to the no-pay list.

Medicare estimates the move could save the government about $190 million over five years, a small sum compared with the $429.7 billion it spent in 2007 on the program.

Anthem did not have figures on how much its no-pay program could save the company, Schukman said, but their contracts prevent hospitals from billing the injured patient for extra costs.

Right now, when medical errors occur at hospitals, insurers typically pay the doctors and hospitals as if everything went fine.

"The reality of medical errors is when an error is made, there isn't someone who stops the payment process," said Doug Gray, executive director of the Virginia Association of Medical Plans, a Richmond advocacy group for managed health care companies.

Many health care experts say that could change with Medicare leading the way and other insurers, like Anthem, following as is often the standard in the industry.

"I think it does send a message to patients and family that not only are payers paying attention to the care delivered in hospitals but so are the hospitals," said Dr. Anthony Slonim, vice president of medical affairs at Carilion Roanoke Memorial Hospital.

Hospital officials have safety plans in place

Still, many hospital administrators say the new policies by Medicare and Anthem are no surprise, and that while they help bring patient safety to the forefront, hospitals for years have striven to adopt policies that take aim at reducing the number of medical errors.

"This is not something that just dropped out of the sky," Slonim said.

Hospital-acquired infections, for instance, have long concerned medical providers because they often require additional care, laboratory testing and longer inpatient stays, Slonim said. He estimated that such infections could tack on an additional $30,000 to $50,000 cost for a single hospitalization, depending on the kind.

And many hospitals have gone to great lengths to introduce new safety measures, such as hand-washing spies and surgical sponges that sound alarms if left inside the body.

Carilion Clinic, for instance, has taken a team-based approach to making its staff more vigilant for errors, Slonim said. Rather than having treatment standards vary from doctor to doctor, its staff instead works cooperatively to abide by preset protocols and check lists.

"Doctors, nurses, respiratory therapists all are working from the same playbook," Slonim said.

Last year, the surgical error rate at Roanoke Memorial for "never events" that would fall into Anthem's no-pay category was 0.01 percent, occurring three times out of 30,000 surgeries, according to officials with the not-for-profit organization.

Slonim would not specify what exactly they were, but said that each mistake is a learning experience and it's not unusual for hospitals providing complex care to have a minimal number of errors.

Local hospitals' practice is not to bill for errors

In general, Carilion has refrained from billing for errors that occur at its hospital and are categorized as "never events" by Medicare and Anthem -- a practice Carilion has made policy in the past few months, said spokesman Eric Earnhart.

Lewis-Gale Medical Center's surgical error rate in 2007 for the four core "never events" targeted by Anthem was 0.0128 percent, said Nancy May, a regional spokeswoman for HCA Inc., which owns the Salem facility along with Montgomery Regional Hospital in Blacksburg, Alleghany Regional Hospital in Low Moor, and Pulaski Community Hospital.

May declined to specify the exact number of errors, what they were, or the total number of surgeries performed last year at the hospital, explaining "with our number of errors being so low we would not want to jeopardize the privacy of the patients by providing a specific number."

The hospital chain, however, has also made it a general practice not to collect money for medical errors.

According to May, numerous practices are in place to keep mishaps to a minimum, such as having bed alarms to prevent patient falls, completing a "timeout" checklist prior to each surgery, double-checking blood types in the lab, testing high-risk patients upon admission for infections acquired outside the hospital, and outfitting hospital beds with a mechanism that reduces pressure ulcers by raising the patient's heels.

Chris Bailey, senior vice president of the Virginia Hospital and Healthcare Association in Richmond, said that, in general, hospitals "have no quarrel with the intentions of not billing for so-called never events."

But the group questioned how insurers plan to determine the source of an error and worry that hospitals could be blamed for blunders originating outside the hospital, such as infections acquired in the community.

Safeguarding against outside errors could result in increased data collection and additional costs, he said.

Bailey added that the payers and hospital executives are still negotiating the "mechanics" of implementing the policy in Virginia and will convene in the coming months to discuss details.

He also noted that Virginia might follow the lead of several other states, such as Massachusetts, whose hospital associations have adopted policies to voluntarily stop billing insurers for certain preventable medical errors that occur on hospital grounds.

The Associated Press contributed to this report.