As is, readmissions penalty may push some hospitals over brink

Failing to adjust measures such as Medicare’s readmissions reduction program for sociodemographic factors will put already financially stressed safety net hospitals at risk and worsen healthcare disparities, according to an editorial published online July 22 in the Annals of Internal Medicine.

Under the readmission penalty, Medicare withholds 2 percent of reimbursement to hospitals with higher than expected 30-day readmissions for heart failure, acute MI or pneumonia. The penalty will increase to 3 percent next year, and other conditions and procedures—including CABG and PCI—are under consideration for coming years. The measures currently adjust for clinical factors but not factors such as income, ethnicity or education level that also may influence outcomes.  

Steven H. Lipstein, MHA, president and CEO of BJC HealthCare in St. Louis, and W. Claiborne Dunagan, MD, MS, vice president of BJC’s Center for Clinical Excellence, dissect differing positions of the National Quality Forum (NQF) and the Centers for Medicare & Medicaid Services (CMS) in the editorial. The two authors sit on NQF’s Expert Panel, which in July recommended including sociodemographic factors in scoring methodologies unless there is a lack of empirical evidence or a conceptual relationship to outcomes.

CMS, on the other hand, has balked at including sociodemographic factors, countering that inclusion actually might create different standards and mask disparities in care for low income and disadvantaged patients. The agency also argued the evidence is not yet sufficiently developed to allow for reliable and valid results.   

The authors compared discharge-weighted census track poverty rates and hospital all-cause readmission rates at different adult hospitals within the BJC system. The four hospitals with the highest poverty rates also showed the highest readmission rates. Two of the hospitals were safety nets, one was rural and the other a teaching hospital. Two hospitals that served a disproportionate number of Medicaid and uninsured patients posted negative margins, one at $6 million and the other at $28 million.

“The imposition of readmission rate penalties that are not SDS [sociodemographic status] risk-adjusted only exacerbates these losses and financial challenges,” they wrote. “While some safety net providers across the United States are able to keep their readmission rates below national averages, policy makers should not assume that all safety net providers are equally resourced at the local level so that the playing field is indeed level. It is not.”

Some safety net hospitals receive local tax support to maintain infrastructure and better prepare and sustain discharged patients, Lipstein and Dunagan suggested. Those hospitals may meet predicted 30-day readmissions rates and avoid penalties. Less resourced hospitals may not, creating a downward spiral.

“If safety net providers fail, disparities in outcomes and access will only worsen for low income and disadvantaged patients,” they warned.

The argument fell on receptive ears. On July 23, the NQF supported a trial to assess the impact of sociodemographic adjustments, which may pave the way for new NQF-endorsed measures. NQF announced it will release details on the trial’s duration, submission requirements and objectives later.