The Agency for Healthcare Research and Quality's Patient Safety Indicators (PSIs) were designed to reflect the quality of inpatient care by triggering cases for review using administrative data and examining potentially preventable complications. With an increasing focus on withholding payment for complications of care not present on admission (POA), efforts to make this important distinction continue. This study applied the use of PSIs with and without a POA variable and discovered that event rates were significantly lower for five PSIs using the added variable (decubitus ulcer, foreign body left in, selected infections due to medical care, and postoperative derangements and thromboembolic events). These findings suggest that use of standard PSIs will overstate the number of hospital complications in failing to take into account those clearly POA. The authors conclude that unadjusted PSIs should not be used to profile hospital performance or determine reimbursement.