The New Year is weeks away but healthcare organizations have already resolved to strengthen their focus on reducing hospital readmissions, which waste at least $26 billion annually.
Thanks largely in part to Affordable Care Act's Hospital Readmissions Reduction Program, which requires CMS to reduce payments to hospitals with excess readmissions, hospitals and medical practices are feeling increased pressure to keep patients out of the ER after hospitalizations.
"CMS started focusing on readmissions with pneumonia, heart attacks, and [CHF], so payment adjustments were focused on just those three, but in 2015, CMS added hip and knee replacements, and in 2016, it will add COPD," notes Laura Palmer, the director of professional development for the Medical Group Management Association.
Making things more intense is the fact that hospitals are starting to feel the financial impact of this legislation: In October 2014, CMS announced that 2,610 hospitals will receive lower payments, totaling an estimated $428 million due to readmissions penalties.
The shift to value-based care, industry-wide, is also playing a big role.
"One of, perhaps, the most impactful elements of the ACA is the subtle, but real, migration of risk from the payers to the providers," says Wayne Sensor, CEO of Ensocare, a care-coordination technology provider and the former CEO of Alegent Health. "Collectively programs such as the Medicare Shared Savings program, bundled payments, value-based purchasing and accountable care organizations have caused the provider community to enlist a broad range of initiatives to more effectively manage the episodes of care, regardless of the setting. Examples include leveraging technology to more efficiently and effectively discharge patients and to coordinate care post-discharge, as well as the use of medical homes."
Hospitals Under Pressure
Unfortunately, the ACA provision that calls for payment penalties has had the greatest effect on hospitals who serve some of the neediest patients. These hospitals are being unfairly penalized because the socio-demographic characteristics of the patients they serve mean it is more likely these impoverished patients will need readmission, notes Akin Demehin, senior associate director, policy, for the American Hospital Association.
Recent data from CMS show that approximately 77% of hospitals serving the poorest patients incur a readmissions penalty. By contrast, only 36% of hospitals with the fewest poor patients will receive a penalty.
"We certainly agree with the goal to address readmissions that should be prevented, but hospitals are concerned with the structure of the program," says Demehin. "Your likelihood of being readmitted has to do a lot with factors the hospitals can't control. Sometimes communities where patients live don’t have primary-care physicians, or patients have difficulties in getting medications. Hospitals treating the poorest patients tend to get the stiffest penalties."
Even with those challenges, hospitals are stepping up their game.
"Planning patient discharge has become a real focus for hospitals," says Demehin. "In terms of understanding what their risk of readmission might be, and which patients are at higher risk. Discharge planning has become something that’s woven into the care plan."
In addition, hospitals have have amped up their patient-education efforts and formed better collaborative relationships with their healthcare partners, such as nursing homes and home health agencies. Efforts such as these have led to a "pretty steady decrease in the national rate of readmission," he notes.
New Technology is Helping
The ACA hospital readmission penalties, coupled with the EHR Incentive "meaningful use" program and other initiatives, have led to a huge growth in technology designed to help providers address readmissions.
"From just a data-tracking standpoint, medical practices need to have good information from the hospital," says Palmer, adding that monitoring devices are just one example of a technology that has allowed physicians to make sure patients are receiving timely follow-up care. Because primary-care physicians are taking on more responsibility as care coordinators, much of the technology on the market is aimed at them, she adds.
And while EHRs have helped care-coordination and data collection efforts, there is a growing market for business intelligence technology that helps healthcare organizations have a better understanding of risk factors.
"Once EHRs are in place, other enabling technology can leverage the rich data for the benefit of better patient care," says Sensor. "Examples include data mining by diagnosis to improve the delivery of care and alerts for the provider that may indicate a need for clinical intervention."