House Members Send Letter to CMS Addressing Readmission Penalties

A bipartisan group of House members have sent a letter urging CMS to work with Congress to help ensure the readmission reduction program does not harm healthcare organizations that provide services to dual-eligible beneficiaries and low-income seniors, according to a Bloomberg report.

The readmission reduction program, which was established by the Patient Protection and Affordable Care Act, took effect in fiscal year 2013. During the first year, CMS cut Medicare reimbursement by up to 1 percent for 2,213 hospitals with high readmission rates for heart attack, heart failure and pneumonia. The second round of penalties started Oct. 1, 2013, and CMS cut reimbursement for 2,225 hospitals in 49 states by up to 2 percent.

According to the reduction program, a readmission occurs when a Medicare patient is readmitted to the same or another acute-care hospital within 30 days of discharge, with certain exceptions such as transfers to another hospital and planned readmissions for chemotherapy, rehabilitation or other treatment. CMS penalizes hospitals for readmissions exceeding a hospital's expected readmission rate, which is the national mean readmission rate risk-adjusted for demographic characteristics and the severity of illness for a particular provider's patients.

In fiscal year 2015, the stakes will get even higher. Hospitals could see their Medicare payments cut by as much as 3 percent, and CMS plans to add chronic obstructive pulmonary disorder and total hip and knee replacement to the program.

Congress has taken notice of many hospitals' view that the readmission reduction program is flawed. In their letter, 34 lawmakers said CMS needs to ensure hospitals are not being penalized for readmissions unrelated to the initial reason for admission. The lawmakers supported their position by citing to numerous studies that concluded many readmissions hospitals are being penalized for under the program are more closely linked to community factors than hospital quality, according to Bloomberg.

There has also been legislation introduced that would require the readmissions reduction program to account for socioeconomic status as well as dual-eligible beneficiaries. The legislation is sponsored by Rep. James B. Renacci (R-Ohio).

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