AAMC Reporter: June 2009

Discussion Grows Over Hospital Readmissions

Hospital patients who are readmitted soon after their discharge are at the center of a push by lawmakers looking for health care savings and streamlined patient care.

Many regulators see readmissions, also known as rehospitalizations, as a relatively easy target for reform. However, hospital leaders stress that real improvement would require sweeping changes in care delivery and coordination, payment methodologies, and even the formula used for defining and evaluating readmissions.

"It is not something that can be turned on like a switch," said Ruben Amarasingham, M.D., M.B.A., associate chief of medicine at Parkland Health and Hospital System and assistant professor of medicine at the University of Texas Southwestern Medical Center at Dallas. "You really have to optimize every aspect of inpatient care, the patient transition as they are preparing for discharge, and the care they receive after discharge. And on top of that, the patient must also be involved in learning what he or she needs to do not to return to the hospital. There has to be a systemic, methodical approach."

An April report in the New England Journal of Medicine found that almost 20 percent of the nearly 12 million Medicare beneficiaries who had been discharged from a hospital between 2003 and 2004 were rehospitalized within 30 days, and 34 percent were rehospitalized within 90 days. Unplanned hospital readmissions cost Medicare $17.4 billion during that time frame, according to the study. A 2007 report by the Medicare Payment Advisory Commission (MedPAC) found that Medicare paid an average of $7,200 dollars per readmission deemed potentially preventable.

Beginning this month, the Centers for Medicare and Medicaid Services (CMS) is posting on its Hospital Compare Web site the readmission rates for Medicare patients who are readmitted within 30 days of the original admission date due to heart failure, heart attack, or pneumonia.

Readmissions reform could be particularly important to teaching hospitals, which tend to admit—and readmit— patients with severe and chronic conditions. According to a recent University HealthSystem Consortium analysis of approximately 100 members of the AAMC's Council of Teaching Hospital and Health Systems, Medicare patients with a higher severity of illness have higher readmission rates—as high as 22 percent within 30 days for the most severe cases.

Meanwhile, President Barack Obama's fiscal 2010 budget calls for $26 billion in savings from readmissions over 10 years, and MedPAC and the Congressional Budget Office have suggested payment reductions for hospitals with high readmission rates. Congress also is interested in readmission payment policy. In late April, the Senate Finance Committee released a paper on reducing Medicare costs that included a readmission payment policy. New policies could reduce payments to hospitals with high, risk-adjusted readmission rates for "potentially preventable" conditions.

"It is critical that any readmission policy takes into account severity of illness. We are pleased that lawmakers seem to recognize this by stating that adjusting statistics for risk would be part of the equation," said Jennifer Faerberg, AAMC director, health care affairs. "In some cases, it's fairly clear that when a patient is readmitted the reason is related to the quality of care from the initial hospitalization. However, in most cases it is difficult to make the distinction and therefore identify truly preventable readmissions."

For the Hospital Compare postings, however, CMS is utilizing what is generally termed the "all-cause" formula for calculating hospital readmission rates. This method counts any readmission, including those unrelated to the original cause of hospitalization, toward the hospital's total count.

Harlan M. Krumholz, M.D., professor of medicine and epidemiology and public health at Yale University School of Medicine, helped design the "all-cause" readmission methodology and said this method was probably still the best means of quantifying readmissions.

"We felt that from a patient's perspective, the all-cause rate was more meaningful," Krumholz said. "If you start parsing it out, it's hard to know what is related and what isn't. I admit the measure is not perfect, but it is good enough to give information and to get people talking."

In any event, according to Faerberg, publishing readmission data could give providers incentives to examine their readmission rates, which could guide improvement initiatives.

Of course, patient care is ultimately at the center of the readmissions debate. One project designed to help create better patient support during and after a hospital discharge is Care Transitions, a national program undertaken by 14 health care facilities designated by CMS as Quality Improvement Organizations. Each organization studies local readmissions patterns and works with community health providers to design a plan for reducing readmissions. A cornerstone of each program is the patient coach, usually a nurse, who works with patients for one month after discharge. According to program data, readmission rates are 50 percent lower for coached patients.

At Parkland, electronic medical records link the central hospital to a vast network of Community Oriented Primary Care clinics to better coordinate and inform care after discharge. Parkland is also developing what Amarasingham calls electronic predictive models, a computer program that identifies patients at high risk for readmission and directs extra education and communication efforts with that person. Parkland ultimately hopes to reduce overall readmission rates by up to 6 percent.

Finally, because fewer readmissions mean fewer occupied hospital beds—and fewer payments from Medicare—nearly all hospital experts and officials agree some kind of new payment system is necessary.

"We need a realignment of the payment system for this to really work, and I think the new administration gets that," said Amarisngham. "For us to stay solvent we need a system that adequately reimburses us for keeping readmissions low. But as they say, the devil is in the details."

—By Scott Harris