Introduction

Health care spending is a significant area of concern as the national health spending is projected to grow at an average rate of 5.6% each year from 2016 to 2025. In 2015, the National health expenditure accounted for 17.8% of the gross domestic product (GDP) and it is projected to grow 1.2 percentage points faster than the GDP over the next 10 years.

In an effort to limit some of the health care costs, several measures, including the Affordable Care Act (ACA), were developed to restructure and potentially reduce health care spending. These measures are focused on reducing health care costs while maintaining or improving quality of care within the nation’s hospitals. The difficulty lies in determining which measures correlate with quality and how to track the delivery of care. Measures such as hospital readmissions, mortality, and patient satisfaction are being used as surrogates for quality health care. Despite its use as a quality metric, the preventability of readmissions is unclear and not well studied. Several readmission risk prediction models have been developed but have limited accuracy in identifying high-risk patients.

A hospital readmission happens when a patient is admitted to a hospital within a specified time period after being discharged from an earlier initial hospitalization. For Medicare, this time period is 30 days, and includes readmissions to any hospital, not just the one in which the patient was originally hospitalized. Some readmissions are unavoidable. While some readmissions are considered to be a planned stage in a patient’s care, many are unplanned and unexpected. Similarly, while some are unrelated to the previous hospitalization, many can be preventable through hospital-based initiatives to decrease readmission rates. The American Hospital Association (AHA) defines the following types of readmissions: (1) planned readmission related to the initial admission, such as a scheduled craniotomy for treatment of an arteriovenous malformation after a prior admission for intracerebral hemorrhage; (2) planned readmission unrelated to the initial admission, such as readmission for scheduled craniotomy following prior admission for acute femur fracture; (3) unplanned readmission unrelated to the initial admission, such as readmission for an acute femur fracture after prior admission for a scheduled craniotomy; and (4) unplanned readmission related to the initial admission, such as surgical site infection after craniotomy. Although Center for Medicare and Medicate Services (CMS) initially did not exclude planned readmissions in the penalty program, they have subsequently developed an algorithm to account for planned readmissions. However, unplanned unrelated readmissions are still included in the Hospital Readmissions Reduction Program (HRRP) penalty calculation even though they are not associated with the care delivered.

Importance of Readmissions

Specific causes for readmissions are varied depending on the patient’s diagnosis, location, socioeconomic status, and hospital system. There is also significant variance between medical and surgical hospitalizations. Studies have shown that events occurring during the index hospitalization, such as an adverse patient safety event or hospital-acquired infections, are associated with increased risk of readmission. Difficulties frequently arise when transitioning to home or postacute care after hospitalization. With discharges to home, the patient and/or their caregivers are expected to assume management of their recovery, many of which may have been handled by health care staff while in the hospital. Patient/families may not have realized how much support or care is needed and may not be able to provide this level of care. Often during hospital stays, multiple teams are involved in different aspects of the patient’s care and require significant coordination. On discharge, there may be confusion as to different teams’ recommendations, follow-ups, or medication changes, and this lack of clarity can result in repeat hospitalizations.

Hospital readmissions are costly with readmissions for Medicare patients alone adding up to $26 billion dollars annually. In 2007, the Medicare Payment and Advisory Commission (MedPAC) estimated that 17.6% of Medicare patients discharged from the hospital were readmitted within 30 days. In all, 76% of these readmissions were considered potentially avoidable, totaling over $12 billion spent on potentially avoidable readmissions. Readmissions can also represent poor care or missed opportunities to coordinate better care. When readmissions occur in these settings, patient satisfaction is often negatively affected.

In response to the rising number and costs of readmissions, the HRRP was established through the ACA in 2012. This program provides financial incentives to hospitals to reduce hospital readmissions. Those hospitals with excess readmissions are subject to reduced payments from the CMS.

The initial emphasis of this program was on readmissions related to four specific medical conditions (myocardial infarction, heart failure, pneumonia, and chronic obstructive pulmonary disease) but has now broadened to include measures related to surgical patients (total hip or knee arthroplasty and coronary artery bypass graft). For example, a hospital can be penalized up to 3% of base inpatient payments if they have above-average readmissions rates (from a prior 3-year period) for one of the six clinical conditions listed above. CMS reports in 2017 that 80% of hospitals will have a reduction in payments because of the HRRP, with over 90% of major teaching hospitals receiving a readmission penalty.

Recent data have shown that potentially preventable readmissions have declined by 2.4% for all conditions since the initiation of this program. Although CMS excludes patients with certain planned readmissions, transferred to another hospital or who left against medical advice, CMS includes patients readmitted for reasons unrelated to the initial hospital stay.

According to the Advisory board, although CMS will reduce reimbursements for 2597 hospitals due to readmissions penalties in fiscal year (FY) 2017, compared to 2665 hospitals in FY 2016, under HRRP they will withhold $528 million in payments in FY 2017, and an increase of ~$108 million from FY 2016. The increase is partially due to changes in how CMS measures pneumonia readmissions and the addition of coronary artery bypass grafts to the program’s procedure list. According to Kaiser Health News , the average penalty will increase from 0.61% in FY 2016 to 0.73% in FY 2017, with hospitals in FY 2017 receiving the maximum 3% penalty.

Under this plan, hospitals paid under the Inpatient Prospective Payment System are eligible for HRRP penalties, while critical access hospitals, inpatient psychiatric facilities, and postacute care providers such as long-term acute care hospitals are excluded. CMS applies a risk adjustment to account for differences in clinical mix such as age, gender, comorbidities, and patient frailty in calculation of the financial penalty, comparing each hospital to others in the nation. However, the plan did not apply a similar risk adjustment to account for sociodemographic factors within a hospital’s service area, although studies have demonstrated that economically disadvantaged patients have a higher risk of readmission making hospitals caring for these patients more likely to incur a penalty under the HRRP.

Owing to growing concerns regarding the unfairness of this plan, changes were made in the 21st Century Cures Act in December 2016. Although the law originated to address biomedical innovation, it included a provision that requires Medicare to account for patients’ backgrounds when determining financial penalties under the HRRP, redistributing the penalties across a greater number of hospitals. The amount of money CMS receives will not change, but instead will come from a different distribution of hospitals. The most likely to benefit from this change are inner-city hospitals and those with a high teaching component, which have been most unfairly affected the penalties, while affluent hospitals will need to work harder to get their readmission rate below the national average.

Methods to Reduce Readmissions

With the increased emphasis on reducing readmissions, several initiatives and strategies have been developed to assist hospitals in decreasing these numbers. Many are aimed at addressing issues that have been shown to be associated with increased risk for readmissions. To aid hospitals in this endeavor, the Advisory Board has developed a “Readmission Reduction Toolkit” to help isolate and correct patient and systemic issues in four stages of care: transition planning during inpatient stay, discharge education, postacute care coordination, and transitional care support. In the Department of Neurosurgery at the University of Minnesota, we have broken down the critical stages of intervention as: prehospitalization, hospitalization, time of discharge, and after discharge.