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Rick Pollack AHA

Bill would adjust readmissions for socio-economic factors

By Sabriya Rice
Posted: June 20, 2014 - 4:15 pm ET

A group of U.S senators introduced legislation Thursday that aims to address growing concerns that hospitals serving low-income populations are unfairly penalized under Medicare's Hospital Readmissions Reduction Program.

The Hospital Readmissions Program Accuracy and Accountability Act would require the CMS to account for patient socioeconomic status when calculating risk-adjusted readmissions penalties. Holding all other factors constant, socioeconomic conditions—such as poverty, low levels of literacy, limited English proficiency, minimal social support, poor living conditions and limited community resources—likely have direct and significant impacts on avoidable hospital readmissions, and adjusting for these factors would improve accountability and quality of care, according to the text of the bill.

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CMS does not comment on pending legislation. In a previous statement to Modern Healthcare on 30-day readmission penalties, the agency acknowledged the complexity but said its research shows hospitals in poor communities “can and do perform well on readmissions measures.”

The bills' sponsors—Joe Manchin (D-W.Va.), Roger Wicker (R-Miss.), Mark Kirk (R-Ill.) and Bill Nelson (D-Fla.)—noted in a statement that numerous studies show hospitals taking care of large numbers of low-income patients consistently have higher readmission rates. Patients often lack the support and resources to keep them out of the hospital, they said.

Even when hospitals provide high-quality, patient-focused care, those serving disproportionate numbers of disadvantaged, low-income patients will have higher rates of readmissions, Manchin said.

“Failing to recognize this reality has led to unfair penalties,” he said, “which is why we need to reform this program immediately.”

Several groups weighed in with support for the legislation.

Hospitals caring for the poorest patients are not only more likely to incur a penalty, but to incur the maximum penalty, according to the American Hospital Association. The new legislation would improve fairness and correct a weakness in the HRRP, said Rick Pollack, the association's executive vice president in a statement.

“While we absolutely agree that hospitals should do all within their power to reduce readmissions,” Pollack said, “the existing program penalizes hospitals for factors beyond their control and takes away critical resources.” he said.

America's Essential Hospitals, which advocates for the nation's safety net hospitals and health systems, said it strongly supports the bill. Hospitals participating in the group's federal hospital engagement network have seen an average reduction of more than 100 readmissions over an 18-month period, but the organization says recognizing the unique nature of the populations served can lead to additional progress.

The bill would help to level the playing field, explained Beth Feldpush, senior vice president of policy and advocacy.

“Incentive-based payments that don't adjust for socioeconomic status can further disadvantage hospitals,” she said. “The bill will preserve funding vital to hospitals that care for vulnerable people.”

Created as part of the Patient Protection and Affordable Care Act, the readmissions reduction program took effect in October 2012. The CMS calculates each hospital's readmission performance over a three-year period, for conditions such as acute myocardial infarction, heart failure and pneumonia. If a hospital has an excess readmission ratio that is worse than the national average, its Medicare reimbursement is docked up to 2%. The maximum penalty rises to 3% in fiscal 2015. The methodology takes into account individual factors, such as the presence of co-morbidities that disproportionately affect certain patient groups, but not socioeconomic factors.

The CMS has emphasized that actions can be taken within and outside hospital walls to make sure patients don't need to return to the hospital after they're discharged.

Risk-adjusting outcomes for patient socioeconomic status would suggest that hospitals with low-SES or non-white patients are held to different standards, the CMS said. It added that the scope of activities that fall within a hospital's control is wider than it may seem, giving hospitals a range of opportunity to influence readmission rates in their community.

Still, a recent study from the research and data firm Truven Health Analytics found that race and unemployment were particularly strong predictors of higher readmission rates. Unemployment was found to contribute to about 18% of a community's readmissions, and about 6% was related to poverty among the elderly, the analysis found. The chances of a black patient being readmitted were almost 15% higher than they were for a white patient.

A study published in May in the journal Health Affairs looked specifically at the effect of community socio-economic status on readmission rates at Henry Ford Hospital in Detroit. It found patients from high-poverty neighborhoods of the city were 24% more likely to be readmitted to the hospital.

David Nerenz, director of the Center for Health Policy and Health Services Research at the Henry Ford Health System, acknowledged that hospitals can make additional efforts to address readmission factors. Henry Ford, for example, instituted a program to help patients understand discharge instructions and partnered with community healthcare workers to help patients with needs such as nutrition and transportation when they return home. But part of the problem, Nerenz says, is that each effort takes time, costs money and means attention is diverted from other areas of concern.

“The challenge, of course, is 'where is the limit?'” Nerenz said. “Readmission is a problem, but it's not the only problem.”

Follow Sabriya Rice on Twitter: @MHSRice

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