Why are hospitals being penalized for reducing readmissions?

The Hospital Readmissions Reduction Program is designed to provide incentives for hospitals to reduce the number of unnecessary hospital readmissions. However, hospitals that reduce both readmissions and discharges are being penalized under the program, according to data analysis by Altarum Institute's Center for Elder Care and Advanced Illness.

The analysis revealed nearly all of the eligible hospitals in San Diego County are being penalized by the readmission's program, yet San Diego County is doing significantly better than the national average at reducing readmissions.

The hospitals in San Diego County are being penalized due to a problem with the way Medicare measures progress, according to the analysis. Medicare divides the number of readmissions by the number of discharges from each hospital to determine if the hospital is making progress in reducing readmissions. However, "good practices reduce the discharges at nearly the same rate as readmissions, making the ratio stay the same despite substantial improvement," according to the report.

"Some hospitals and communities are creating the standard for best practices, and the rest of the country should be learning from them," said Joanne Lynn, MD, the director of the Center for Elder Care and Advanced Illness. "Instead, the measure that Medicare uses makes them appear to make little progress and most of their hospitals are being penalized."

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