April 22, 2019

Study: CMS policy changes cut readmission fines

By: Judy Mathias
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Editor’s Note

The Centers for Medicare & Medicaid Services (CMS) recent changes to its Hospital Readmission Reduction Program resulted in a drop in readmission fines for academic, safety-net, and rural hospitals, this study finds.

This analysis of 3,049 hospitals found that because of policy changes that now separate hospitals into five peer groups based on the patients they serve:

  • 44.1% of teaching hospitals and 43.7% of rural hospitals had a lower penalty this year than last
  • the average penalty for teaching hospitals is expected to decrease from $287,268 to $283,461
  • the average penalty for rural hospitals is estimated to drop from $55,268 to $53,633
  • as a whole, penalties for hospitals serving the largest number of poor patients are estimated to decline by more than $22 million.

Policymakers should monitor the association of these changes with trends in readmission rates and hospital financial performance as the policy is fully implemented, the authors say.

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