CMS introduced a Hospital Readmissions Reduction Program in 2011, which reduces reimbursement payments to hospitals with excess readmission rates. In effect, the program acts as a means to increase the quality of care while reducing spending. Some private payers have also implemented similar programs in an effort to cut costs and promote better care for their members.
Now entering its second year in operation, the HRRPs impact is becoming noticeable. Prior to its implementation, one in five Medicare patients were readmitted annually – an estimated cost of $17.5 billion USD. Under the program’s provisions, Medicare penalized close to 2,200 hospitals with excessive readmission rates – 300 of which were fined the maximum penalty.
At the end of 2012, almost a year after the HRRP was put into effect, readmissions rates dropped to 17.8 percent of patients per year, compared to the average 19 percent for the last five years. This change resulted in 70,000 fewer readmissions in 2012, and a decrease of $53 million USD in spending.
In order to operate within the provisions of the HRRP, many hospitals have implemented programs to ensure their readmissions rates remain at their lowest. These programs have encouraged hospitals to use a combination of approaches including:
- Making a concentrated effort to understand the root causes of readmissions.
- Developing quality initiatives and adopting a system of continuous improvement.
- Following patient focused care models.
- Improving communication with outpatient providers and patients.
- Greater attention to care transitions and post-discharge care.
For example, Mercy Health in Cincinnati employs nurses solely to oversee care transitions for patients being discharged. They are responsible for monitoring patients outside of the hospital and assist with all follow-up instructions and medical procedures.
Many hospitals have also provided funding for organizations that look to promote better care coordination, such as a “hospital engagement network that works with hospitals to identify ways in which they can reduce and prevent unnecessary readmissions.