Readmission penalties reach record high

The Centers for Medicare & Medicaid Services levied a record number of fines against hospitals for excessive readmissions, according to a Kaiser Health News analysis of federal records released this week.

CMS will penalize more than 2,600 hospitals over the next year and the average fines will be higher--the ceiling for fines increased this year to 3 percent of reimbursements, according to the article. 

Not only will this year's round of penalties bring deeper cuts, it will affect more hospitals. The analysis reveals that Medicare will penalize 433 more hospitals than last year and half of the hospitals in 29 states and the District of Columbia will receive penalties. In New Jersey, only one hospital will avoid the penalties this year, according to KHN. 

Earlier this year, CMS data indicated readmissions were above average in 20 percent of hospitals in six states, FierceHealthcare previously reported.

Of the hospitals that receive the maximum penalty, many are specialty surgical hospitals and small community organizations, according to KHN, as well as the nation's oldest hospital, Pennsylvania Hospital in Philadelphia. 

Hospitals given the smaller 1 percent fine include Chicago's Northwestern Memorial Hospital and Rush University, Manhattan's Beth Israel Medical Center and Boston's Tufts Medical Center. 

The increased fines may be partially due to CMS adding two new categories to its readmission criteria, according to the article. This year Medicare began assessing patients initially admitted for elective knee or hip replacements and patients with lung conditions. "Every time they add conditions, the penalties go up," Nancy Foster, a quality expert at the American Hospital Association, told KHN.

Medicare's penalty system has hospitals nationwide rethinking their prevention strategies, according to NPR. Many facilities provide free medicine for low-income patients, make sure they schedule a follow-up appointment before leaving or send nurses to follow up with them at home. The "really fairly modest step" of readmission penalties "persuaded a lot of hospitals to talk in ways they simply were not talking 10 years ago," consultant Stephen Jencks, M.D., told NPR.

To learn more:
- here's the KHN article
- download the Medicare data (zip file)
- read the NPR article