Christian Hospital says a costly difference of opinion with Medicare hinges on how to count the large number of poor people that the St. Louis hospital treats.
Medicare penalizes hospitals that readmit too many patients within 30 days of discharge, and Christian expects to lose almost $600,000 in reimbursements this year, hospital officials said. Christian is one of 14 hospitals in the BJC HealthCare system.
Steven Lipstein, CEO of BJC, which includes Barnes-Jewish hospital in St. Louis, said Medicare doesn't play fair because its formula for setting penalties does not factor in patients with socio-economic disadvantages—low-income, poor health habits and chronic illnesses, for instance—that contribute to repeated hospitalizations.
If Medicare did that, the hospital's penalty would have been $140,000, Lipstein said.
As every healthcare executive knows, half a million dollars pays for “a whole lot of nurses,” he said.
In total, hospitals around the country lost $420 million last year under Medicare's Hospital Readmissions Reduction Program, an initiative of the federal health law that seeks to push hospitals to deliver better patient care.
A study published in the journal Health Affairs in January found that socio-economic factors appear to drive some of the difference in readmission rates between safety net hospitals and their peers—but also that hospital performance may play a role. And, the authors concluded, the program's current method for determining excess readmissions “has already considerably narrowed” the gaps in readmission rates among hospitals.
Hospitals, however, have lobbied Congress and Medicare to change the rules and gained some ground May 18 when Rep. Pat Tiberi (R-Ohio) introduced a bill in the House to adjust Medicare's program to account for socio-economic status. The bill was co-sponsored by Rep. Jim McDermott (D-Wash.). The House Ways and Means Committee has scheduled a May 24 meeting to discuss the bill.
Meanwhile, the Missouri Hospital Association is trying to get public opinion behind it.