FinancialHospitals

New round of Medicare readmission penalties hits 2,583 hospitals

by Jordan Rau, Kaiser Health News | Oct 2, 2019

Medicare cut payments to 2,583 hospitals Tuesday, continuing the Affordable Care Act’s eight-year campaign to financially pressure hospitals into reducing the number of patients who return for a second stay within a month.

The severity and broad application of the penalties, which Medicare estimates will cost hospitals $563 million over a year, follows the trend of the past few years. Of the 3,129 general hospitals evaluated in the Hospital Readmission Reduction Program (HRRP), 83% received a penalty, which will be deducted from each payment for a Medicare patient stay over the fiscal year that begins today.

Although Medicare began applying the penalties in 2012, disagreements continue about whether they have improved patient safety. On the positive side, they have encouraged hospitals to focus on how their patients recuperate, and some now assist them in procuring medications and follow-up appointments.

But the hospital industry and some academics have raised concerns that some hospitals may be avoiding readmitting patients who require additional inpatient care out of fear of the financial repercussions, while others have said the program is not showing major benefits.

“A lot of hard work has gone into trying to reduce readmissions, and the needle has not moved very far,” said Dr. Karen Joynt Maddox, co-director of the Center for Health Economics and Policy at Washington University in St. Louis, who has been skeptical of the initiative. “It’s been a huge investment by hospitals but not very much in outcomes, but some good things have come out of it.”

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Chris J. Stewart

Chris currently serves as Chief Operating Officer at Ortho Spine Partners. Prior to that, he was the assistant vice president and business unit leader of Medical Device Management for HealthTrust.

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