While the number of Medicare beneficiaries who were readmitted to the hospital within a month of being discharged dropped to 2 million (18 percent of patients) last year, the annual costs of readmissions still cost Medicare approximately $17 billion. The federal government wants to reduce those costs, and give hospitals an incentive to improve patient outcomes.
The Centers for Medicare and Medicaid Services (CMS) reduces Medicare payments for Inpatient Prospective Payment System hospitals with excess readmissions based on a ratio measurement. By dividing a hospital’s number of “predicted” 30-day readmissions for heart attack, heart failure, and pneumonia by the number that would be “expected,” based on an average hospital with similar patients, CMS considers the resulting ratio to indicate excess readmissions if it is greater than 1.
The original penalty for excess readmissions was no greater than 1 percent of annual Medicare reimbursements, but CMS increased that penalty this year to 3 percent. Also, for the first time, lung illnesses and elective procedures like hip and knee replacements are counted in the CMS readmissions rate formula.
Hospitals that have been successful in reducing their 30-day readmission rates are now being much more involved in the follow-up care of patients, especially those deemed “at-risk” for landing back in their facility. Some of these measures include:
Not all hospital readmissions are preventable; however, many could be avoided with increased care coordination and collaboration. As the penalty data is made public every year, penalized hospitals in competitive markets may also suffer from a tarnished reputation. Health care organizations that take an active approach to reducing readmissions will be most likely to survive and thrive. What has your facility done to reduce readmissions? Has it worked? What do you think still needs to be done? Tell us in the comments below.