CMS' long-standing Hospital Readmissions Reduction Program incorrectly penalizes hospitals or overlooks hospitals that should receive a penalty, according to a new study.
The findings, published Wednesday in JAMA Cardiology, are the latest to uncover flaws in the Hospital Readmissions Reduction Program, which has been heavily criticized by hospitals and quality researchers since its inception in 2012 under the Affordable Care Act.
The new study found CMS incorrectly penalizes hospitals due to margins of error associated with the 30-day risk-adjusted readmission measure the program relies on. The study evaluated three of the six conditions part of the program: acute myocardial infarction, pneumonia and heart failure. Using CMS data from 2014 to 2017, the study found 20.9% of hospitals should have been penalized for their readmission rates for acute myocardial infarction but weren't, while 13.5% should have received a penalty for their readmission rate for heart failure and 13.2% for their readmission rate for pneumonia. At the same time, 10.1% of hospitals received a penalty for their performance on readmissions for acute myocardial infarction but shouldn't have, while 10.9% were incorrectly penalized for heart failure and 12.3% for pneumonia.
In the penalty program, the readmission rate for hospitals is an estimate because CMS is using a measure with a margin of error. Other outcomes measures CMS uses for value-based payment programs also have a margin of error such as 30-day mortality rates.