Hospitals to lose Medicare funds for high readmission rates

More than 2,200 hospitals, including 137 in Ohio, will face financial penalties of up to 1 percent of their Medicare funds  in the next year because too many patients are readmitted to the  hospital within 30 days of discharge (Source: Medicare penalizing hospitals when patients return too soon, Columbus Dispatch, Aug. 17, 2012).  The penalties, authorized by the 2010 Affordable Care Act (ACA), are intended to encourage hospitals to lower patient readmissions by focusing on better patient education and improved follow-up care.  Annually, about 2 million Medicare beneficiaries — 1 in 5 — are readmitted within a 30 days of discharge at a cost of $17.5 billion. The maximum penalty for readmissions increases to 2 percent of regular payments starting in October 2013 and then to 3 percent the following year. 

Across the country, 278 hospitals - nine in Ohio - will lose the 1 percent maximum of their base Medicare reimbursements.  Hospitals hit hardest are generally those that treat a high percentage of low-income patients for whom access to doctors and medications post-discharge can be a challenge.  The average readmission penalty for both Ohio and the nation is 0.28 percent.

For more information on readmission penalty data, see Kaiser Health News’ analysis.