Who benefits from the Hospital Readmissions Reduction Program?
By David Shields
WealthMark Advisors, Inc
Is punishing medical facilities really the best way to cut costs? Are we seeing the practical consequences of what we’ve been warned of all along — namely, rationing health care?
Hospitals now have something else to worry about. October saw the implementation of the Hospital Readmissions Reduction Program — Section 3025 of Obamacare — a quality-control initiative intended to encourage medical facilities to think twice about admitting patients. In brief, hospitals that receive Medicare money will now be penalized for readmitting Medicare beneficiaries within 30 days of discharging them for acute myocardial infarction (heart attack), heart failure or pneumonia.
According to the Center for Medicare & Medicaid Services (CMS), the measure will improve the quality of care hospitals provide to seniors by guaranteeing their health and recovery before letting them walk out the door. There is now a greater incentive — or decentive — to “get it right the first time” and make sure seniors have an appropriate plan of action at home.
Amending hospitals’ return policies, so to speak, is also intended to cut costs. Taxpayers annually spend $26 billion on Medicare beneficiaries who return to the hospital within a 30-day period of being discharged. The goal is to reduce this amount.
But is punishing medical facilities really the best way? Are we seeing the practical consequences of what we’ve been warned of all along — namely, rationing health care? Along with the rest of Obamacare, the new mandate has faced much criticism, starting with the fact that it’s all stick and no carrot. Medical facilities that are found to be out of compliance will incur a 1 percent Medicare reimbursement reduction, followed by 2 percent in 2014 and 3 percent in 2015. Those that manage to improve their services, however, will see no reward. The government estimates that, in 2013 alone, 2,200 hospitals will each see their Medicare funding slashed by $125,000, for a total of $280 million. Though not a dangerously debilitating amount, the money could be spent instead on patient care. And as predicted, the hospitals that have already been hardest hit since the policy went into effect are those serving the poorest patients.
Another source of contention is the penalty’s apparent arbitrariness. The three ailments currently being tracked account for only a fraction of Medicare admittance, but the CMS is also considering adding joint replacement, heart bypass, stenting and stroke to the list. As things now stand, if a senior is treated for pneumonia but then returns two weeks later with an unrelated issue — a broken hip, say — it still counts against the hospital (should it choose to admit him or her). As more types of illnesses and injuries are added, hospitals will have no other choice than to turn away seniors or see their funding reduced.
Besides the federal government, who are the winners here? Obviously, medical facilities — especially those in needy areas — are none too thrilled with the new policy. The same can be said for Medicare beneficiaries who, rightly or wrongly, depend on the local emergency room for their primary care. Both parties have much to lose. Granted, many hospitals can probably do a better job treating their patients and establishing a post-discharge plan, and many seniors no doubt visit the ER more frequently than they should, costing taxpayers billions of dollars each year. But the Readmissions Reduction Program doesn't give reason to alter the far left's presumed catchphrase and criticism of the American health care system: Don't get sick.