Hospitals Question Medicare Rules on Readmissions

As NAHAM News reported in November, part of the Affordable Care Act (ACA) curbs hospital reimbursement rates based on readmission statistics (Curbing Medicare Spending begins with Hospital Readmission).  A few months after implementation, a growing number of hospitals and interest groups are beginning to question the fairness of the policy.

Under the policy, hospitals face penalties for readmitting patients they have already treated, based on the idea that many readmissions result from poor follow-up care. The theory is that lowering readmissions makes for cheaper and better care in the long run, and helps patients stay healthy as opposed to being readmitted for another Medicare funded hospital stay. To comply, hospitals have implemented new procedures both in and out of the facility. Some call patients within 48 hours of discharge to check up on them, others schedule a follow up appointment before the patient is discharged, still others have redoubled their efforts to ensure that patients understand their medication schedule.

The Medicare program reports that nearly two-thirds of hospitals receiving traditional Medicare payments are expected to pay readmission penalties this year, totaling about $300 million. Last month, however, Medicare reported that readmissions had dropped to 17.8 percent by the end of last year, down from 19 percent in 2011.

Critics argue that these penalties unfairly target hospitals with the sickest or poorest patients, and that mortality rates are not properly taken into account. As one doctor put it in a New York Times article, “dead patients cannot be readmitted”, but alive and sick patients can. Critics say that readmissions are tied to social or economic factors; poor patients may not be able to afford medication, have a bed to recover in, or a car to get to follow up appointments.

Despite the criticisms, the changes by hospitals and the decrease in readmission rates is exactly what the policy intended. There will likely be hiccups along the way, but Medicare is hoping to save money and improve care in the long term.