Essay On Hospital Reimbursement

Hospital reimbursement: Outline the significant components that make up the CMS IPPS (inpatient prospective payment system).

In October 1, 2008, the CMS adopted a non-reimbursement policy for certain "never events, which are defined as non-reimbursable serious hospital-acquired conditions (Sollecito & Johnson, 2013, p. 25). Examples of “never events” include surgery on the wrong body part; foreign body left in a patient after surgery; mismatched blood transfusion; major medication error; severe “pressure ulcer” acquired in the hospital; and preventable post-operative deaths (Center for Medicare & Medicaid Services, 2008)

The health care organizations have big opportunity to improve their quality of healthcare service as well as improve life quality of customers through reducing an avoidable readmission. The readmission is defined by Centers for Medicare and Medicaid Service (CMS) “Admission to a subsection hospital within 30 days of a discharge from the same or another subsection hospital” Hoffman, J.H. (2012). Readmissions can be classified four different categories, including (1) Planned readmission which the reason of the readmission is related to the initial admission. For example, reconstructive surgery with subsequent steps or it could be series of treatment such as cancer chemotherapy. (2) Planned but the reason is not related to the initial readmission.

This article reviews the history of Medicare’s Hospital Readmission Reduction Program (HRRP) which began in October 2012. It examines why Medicare and Medicaid initiated the program, clarifies what conditions were originally included in HRRP and analyzes the reasoning behind adding Chronic Obstructive Pulmonary Disease (COPD) to the list of high priority conditions. It also, clarifies what information U.S Centers for Medicare and Medicaid (CMS) take into consideration when calculating readmission rates and points to the fact that high readmission rates could be due to non-hospital factors. The authors review new data that focuses on the potential harm of adding COPD to the list of conditions due to the increased level of patients from lower

This paper deals with the legislative, regulatory components of Medicare Readmission Reduction Program along with recommendation to reduce their readmission rates for a health care facility like Valley hospital in Spokane which has been penalized a higher percentage of 2% as compared to other hospitals in the state of Washington under the third round of penalties.

Hospitals nationwide have been striving to reduce the rate of patient readmissions. Both the federal government and private insurers are tired of picking up the tab. In a 2009 study in the New England Journal of Medicine, researchers estimated that a year's worth of unplanned re-hospitalizations cost Medicare alone $17.4 billion. Congestive heart failure is a particularly big target, as one in four patients end up back in the hospital within 30 days of discharge. Starting in the fall of 2012, the government will cut Medicare reimbursements for hospitals with higher-than-expected 30-day readmission rates for heart failure and two other conditions: heart attack and pneumonia (Avril, 2011).

The Affordable Care Act was enacted to improve health care and to lower health care cost in America. The ACA developed different strategies to meet these goals called the “pay for performance” programs. These strategies are aimed at the different providers to improve quality care. The strategy that I selected is the “Hospital Readmissions Reduction Program” this program/strategy is also known as the HRRP and was begun in October of 2012. HRRP is aimed at hospitals and penalizes hospitals that have a high 30 day readmission rate. The penalties are assessed and based on a number of comparisons, those such as, performance, patient demographics, comorbidities and frailty.

To encourage efforts of hospitals to reduce readmission, the Hospital Readmission Reduction Program (HRRP) was created under Affordable Care Act. The HRRP is mainly a payment penalty program designed to reduce hospital readmission rates for medically expensive conditions- such as heart attack, pneumonia, health failure (penalties levied in 2013 - ‘14). Under this program, hospitals with readmission rates that exceed the national average are penalized by payment cut across all-of their Medicare admissions. For 2015, CMS has added COPD, and elective hip or knee replacement, while types of pneumonia cases following CABG are included starting 2017. In addition to new conditions, the maximum penalty will increase up to 3 percent of the Medicare payment. This penalty is not limited to only above mentioned six conditions, but apply to all Medicare patients. (For HRRP program overview, see attachement-1)

This newer reimbursement system has been a topic of contention amongst a large portion of the professional medical community due to the perceived unfairness that it brings in certain situations where a patient must be readmitted and, as a consequence, the primary care providers may not be reimbursed for the readmission regardless if they were responsible. With the introduction of the Affordable Care Act in 2010, further criteria such as the Readmissions Reduction Program have been added that determines the eligibility of a primary care provider being reimbursed through the Medicare/Medicaid program. These new requirements have led to new avenues of contention amongst healthcare professionals and, in some cases, new avenues for fraud and patient discrimination.

If the Centers for Medicare & Medicaid Services (CMS) change their payer regulations and accreditation requirements, hospitals would need to accommodate their requests for continued supplemental payments. In other words,

The Hospital Readmissions Reduction Program (HRRP) was passed in 2012 under the Affordable Care Act, to help hospitals to improve patient care and reduce costs. (Danner, 2016). The diagnoses with the highest readmissions rates associated with the highest expense are: acute myocardial infarction (AMI), pneumonia, and congestive heart failure. CMS also extended their program in 2015 to incorporate reimbursement reduction for hip/knee replacements, Chronic Obstructive Pulmonary Disease (COPD), and they also have plans in 2017 to include the

Under the ACA there is a new method of payment called value-based purchasing (Yuh et al., 2015). Value-based purchasing focuses on aspects of quality care such as: patient safety, efficient care, and customer satisfaction. By providing quality care, physicians and hospitals are offered incentives that deter them from providing avoidable and pricey care (Yuh et al., 2015). Another way that the ACA is enhancing quality care is through the Readmissions Reduction Program. This program will decrease the reimbursements that the hospital will receive if there are a surplus of readmissions within a 30 day period. Overall, this will also improve quality of care by making sure that the patient is really ready for discharge when leaving the hospital and also strengthen efforts to reduce nosocomial infections (Aoughsten et al.,

The Affordable Care Act (ACA) added to the Social Security Act has increased the financial accountability of healthcare organizations for preventable readmissions. Hospitals have increased their awareness and are looking for system ways to assist in the reduction. The Centers for Medicare and Medicaid Services (CMS) have initiated a process for decreasing the reimbursement for readmitted patients within a 30-day period. CMS identified readmission measures for applicable conditions of acute myocardial infarction (AMI), heart failure (HF), pneumonia and in 2015 chronic obstructive pulmonary disease (COPD) and hip and knee replacement which are included within the measurement to calculate the readmission payment adjustment for

In an effort to curb these costs, in 2013 the Center for Medicare and Medicaid Services (CMS) enacted the Hospital Readmissions Reduction Program. Under this program, hospitals are penalized for readmissions occurring in the first 30 days. The penalties apply to specific conditions for CMS recipients including acute myocardial infarction, heart failure, coronary artery bypass graft

Readmissions is a basis for financial penalties to hospitals as a provision of the Affordable Care Act by reducing payments to hospitals with an” excess” 30-day readmissions. The data showed that patients living in high poverty neighborhoods were more likely to be readmitted, older and male patients were more likely to be readmitted as opposed to young and female patients. Lastly, patients with CHF, acute myocardial infarction, and those with certain diseases, such as diabetes, liver and kidney disease were at higher risk of being readmitted. The data also showed married patients were less likely to have a readmission because of more social support (Study Links Social, Community Factors with Hospital Readmissions,