On Friday, CMS reported that readmission rates have continued to improve. Preliminary claims show that from January through August 2013, less than 18% of Medicare beneficiaries ended up readmitting to a hospital within 30 days. For comparison, the 2012 readmission rate was 18.5%.
CMS attributes this reduction to hospital-level transitional care efforts, as well as systems-level initiatives of the Affordable Care Act, including the Hospital Readmissions Reduction Program (section 3025, that reduces Medicare reimbursement rates for hospitals with high readmission rates) and the Community-based Care Transitions Program (section 3026, that funds community-based organizations to work with hospitals to support Medicare beneficiaries reintegrating back into the community after a hospital discharge). What CMS does not mention, however, is how rising rates of “observation status” may affect this lower readmission rate. Dr. Ashish Jha, professor of public health policy at the Harvard School of Public Health in Boston, asks:
“Fundamentally, the question to me is, have we really done a good job of preventing readmissions, or have we just reassigned people who would have been readmitted to a different status?”
For more information on observation status, see AARP’s “Rapid Growth in Medicare Hospital Observation Services: What’s Going On?”, and for a particular look at how observation status may affect beneficiaries financially, see The Atlantic’s “How Hospitals Pass Their Obamacare Penalties on to Patients”. For an analysis on CMS’s announcement, and a chart listing reimbursement penalties for individual hospitals, we recommend reading Kaiser Health News’s “Rehospitalization Rates Fell In First Year Of Medicare Penalties”.