As support grows for the need to adjust 30-day readmission-rate penalties for hospitals serving impoverished communities, hospital groups remain concerned that new measures and higher penalties anticipated next year will continue to hurt efforts to achieve the very quality measures the penalties are supposed to address.
Last Thursday, a group of U.S senators introduced legislation called the Hospital Readmission Accuracy and Accountability Act, which would require the CMS to account for patient socio-economic status when calculating risk-adjusted readmissions penalties. The impact of that measure could be to reduce some penalties for hospitals in the most impoverished areas by adjusting for readmission factors beyond a hospital's control.
Holding all other factors constant, socio-economic 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. Adjusting for these factors would improve accountability and quality of care, according to the text of the bill.
“Having the financial resources to do quality improvement work is important,” said Akin Demehin, senior associate director of policy for the American Hospital Association. “The program is complex, the formula is complex and it's an area we'd like to see some improvement.”
By fiscal 2015, under current CMS requirements enacted as part of the Patient Protection and Affordable Care Act, hospitals with excess readmissions will be fined up to 3%.
When CMS' Readmission Reduction Program began in fiscal 2013, there was a maximum 1% penalty for hospitals with excess readmissions for three conditions: heart failure, heart attack and pneumonia.
In 2014, more than 2,200 hospitals across the U.S. received Medicare readmission penalties, according to the CMS, a total loss of nearly $230 million in Medicare funding. In fiscal 2015, total hip replacement, total knee replacement and COPD will be added to the measures, and penalties are estimated at $440 million.
The individual hospital impact varies based on each hospital's volume of Medicare patients. For some the penalty could be in the hundreds of thousands, and others well into the millions. The penalties add additional burden that makes it harder for hospitals to meet their quality goals, some hospital policy leaders argue.
“Taking away resources puts tremendous financial strain on hospitals who are trying to do right by their patients,” Demehin said. “When you're looking at a measure, you want to be sure you're isolating those pieces that are critical to a hospital's role.”
Earlier this year, a National Quality Forum open comment period generated more than 650 responses for a project in which the forum seeks to develop a set of recommendations on the inclusion of socio-economic status , race and ethnicity into risk adjustment for outcome and performance measures, including 30-day readmissions.