CMS: Initial penalties for hospital readmissions were set too low

Share this article:

Hospitals posting high rates of Medicare patients readmitted for preventable conditions within 30 days of discharge will have to pay higher penalties than previously thought.

In a notice published last Friday, the Centers for Medicare & Medicaid Services said that it made an error when calculating the penalty rates. The penalties should be based on the readmission rates and reimbursements for patients who were discharged from July 2008 through June 2011. However, CMS inadvertently included Medicare claims before July 1, 2008, in its penalty evaluations.

The recalculation is unlikely to have a meaningful impact. According to a Kaiser Health News analysis of the revised rates, the penalties for one Florida hospital will increase from 0.62% to 0.73% of its reimbursements. Another Pennsylvania hospital will see its penalty fall from 0.51% to 0.4%, Kaiser reported.

Penalties for readmissions tied to pneumonia, heart failure and heart attacks went into effect on Oct. 1. Nursing homes stand poised to benefit from the policy as it encourages hospitals to work closely with post-acute care providers to bring down readmission rates. Medicare expects the penalties to recoup $280 million from hospitals with high readmission rates.

Share this article:

More in News

Long-term care continues to lead in deal volume and value: PwC report

Long-term care continues to lead in deal volume ...

Long-term care bucked healthcare industry trends with strong merger and acquisition activity in the second quarter of 2014, according to newly released data from professional services firm PricewaterhouseCoopers.

Empowering nurse practitioners could reduce hospitalizations from SNFs, study finds

Granting more authority to nurse practitioners is associated with reduced hospitalization of skilled nursing facility residents, according to recently published findings.

Pioneer ACO drops out of program, despite reductions in skilled nursing utilization

A California healthcare system has become the latest dropout from the Pioneer Accountable Care Organization program, despite reducing skilled nursing facility utilization and improving its readmission rates. Sharp HealthCare announced its decision in a quarterly financial statement released Tuesday.