Revised Readmission Penalties To Affect Numerous Hospitals
More than 1,400 hospitals will receive smaller Medicare reimbursements than they were expecting after CMS discovered errors and revised its original calculations for the penalties that will be levied on hospitals for high readmission rates, Kaiser Health News reports (Rau, Kaiser Health News, 10/2).
On Monday, CMS implemented two programs under the Affordable Care Act that target care quality and readmission rates in hospitals as part of a broader effort by the Obama administration to improve quality of care while aiming to save taxpayer dollars.
Under the Hospitals Readmissions Reductions Program, CMS will withhold up to 1% of regular reimbursements for hospitals that have too many patient readmissions within 30 days of discharge because of certain medical conditions, including heart attack, heart failure and pneumonia (California Healthline, 10/1). A total of 2,217 hospitals will be penalized this year, of which 307 will be penalized the maximum rate of 1%.
CMS previously noted that the penalties would be calculated based on readmission rates and reimbursements for patients who were discharged from July 2008 through June 2011, according to KHN. However, in a notice published recently, CMS said it "inadvertently" included in its calculations Medicare claims before July 1, 2008.
As a result, 1,422 hospitals will receive reimbursements that are less than they were expecting, while 55 hospitals will receive slightly more, according to an analysis by KHN. Two hospitals that previously were told that they would not be penalized will lose 0.01% of their reimbursements, KHN reports.
Atul Grover, chief lobbyist for the Association of American Medical Colleges, described the correction as "disconcerting, particularly with a policy that's bad to begin with" (Kaiser Health News, 10/2).
Preventing Readmissions Requires Integrated Network
Some industry experts say that efforts to prevent hospital readmissions should be a collaborative effort that involves patients' primary care physicians, Colorado Public Radio/Kaiser Health News reports. According to CPR/KHN, Medicare pays roughly $17.4 billion annually for returning patients.
Experts point to hospitals like Denver Health, which has low readmission rates. Providers at the Colorado facility help patients obtain follow-up care after they are discharged, according to Thomas MacKenzie, chief of quality at Denver Health. The hospital refers patients to affiliated neighborhood clinics that are linked by an electronic health record system.
However, many hospitals do not have close relationships with PCPs and would require more resources to develop integrated systems, according to Grover. He added that it is not fair to tie hospital reimbursements to how patients receive care after they have been discharged.
Harlan Krumholz of Yale School of Medicine -- who helped design the Medicare readmissions penalty policy -- said the penalties are fair, noting that hospitals are the "central organizing force for health care in most communities in the nation" and that they receive more revenue than other facilities (Whitney, Colorado Public Radio/Kaiser Health News, 10/2).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.