Effect of a Hospital-wide Measure on the Readmissions Reduction Program

The Hospital Readmissions Reduction Program penalizes hospitals that have high 30-day readmission rates across specific conditions. There is support for changing to a hospital-wide readmission measure to broaden hospital eligibility and provide incentives for improvement across more conditions.

We used Medicare claims from 2011 through 2013 to evaluate the number of hospitals that were eligible for penalties, in that they met a volume threshold of 25 admissions over a 3-year period for a specific condition or 25 admissions over a 1-year period for the cohorts included in the hospital-wide measure. We estimated the expected effects that changing from the condition-specific readmission measures to a hospital-wide measure would have on average penalties for safety-net hospitals (i.e., hospitals that treat a large proportion of low-income patients) and other hospitals.

Our sample included 6,807,899 admissions for the hospital-wide measure and 4,392,658 admissions for the condition-specific measures. Of 3443 hospitals, 688 were considered to be safety-net hospitals. Changing to the hospital-wide measure would result in 76 more hospitals being eligible to receive penalties. The hospital-wide measure would increase penalties (mean [±SE] Medicare payment reductions across all hospitals) from 0.42±0.01% to 0.89±0.01% of Medicare base diagnosis-related-group payments. It would also increase the disparity in penalties between safety-net hospitals and other hospitals from -0.03±0.02 to 0.41±0.06 percentage points.

A transition to a hospital-wide readmission measure would only modestly increase the number of hospitals eligible for penalties and would substantially increase the penalties for safety-net hospitals.