A recent study published in Health Affairs (subscription required) found that California essential hospitals are more likely to be penalized than other California hospitals under the Hospital Readmissions Reduction Program, despite having lower 30-day, risk-adjusted mortality rates. Essential hospitals are those that serve a safety net role in their community.
The main findings of the study mirror other recent studies that show hospitals in low-income communities may be disproportionately affected by readmissions penalties. The authors noted that readmission of a patient may represent a high-quality outcome if a patient has lived long enough to be readmitted or could represent a low-quality outcome, if the readmission is due to a lower standard of care. The study also suggests that readmission could be linked to other factors, such as the patient’s lack of access to a primary care physician. Medicare currently penalizes hospitals for excess readmissions. For fiscal year (FY) 2014, the penalty can be as large as 2 percent of a hospital’s revenue from Medicare. For FY 2015, the maximum penalty increases to 3 percent.
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