Federal penalties hit area hospitals

JC, Columbia facilities focus on reducing readmissions, post-discharge care

MU Health Care will receive a Medicare penalty this year under the Affordable Care Act that it managed to avoid last year. Meanwhile, St. Mary’s Health Center in Jefferson City has cut its penalty by nearly half.

Across the state, 55 hospitals are facing penalties, with 29 seeing increased penalties and 32 seeing reduced penalties. About 20 Missouri hospitals will experience no penalty this year.

Nationwide, Medicare is penalizing hospitals $227 million in the second year of the new rule. More than 2,200 hospitals will see reduced payments, and 18 will see the maximum penalty of 2 percent of their Medicare reimbursements.

Under the Affordable Care Act, hospitals that do not meet certain readmission rates face penalties up to 1 percent of Medicare reimbursement rates in 2013, 2 percent in 2014 and 3 percent in 2015. Readmissions of heart failure, heart attack and pneumonia patients are being measured to determine the penalty.

The penalty for University Hospital this year is set at 0.11 percent of its Medicare reimbursements or approximately $70,000. University Hospital is under the umbrella organization of MU Health Care. The penalty falls under a new federal rule that dings

hospitals for not meeting certain benchmarks for readmission of patients within 30 days of discharge.

Mary Jenkins, MU Health Care spokeswoman, said the penalty won’t have a significant impact on the bottom line of a hospital with operating expenses in the hundreds of millions of dollars.

But she said MU Health Care — like hospital systems across Missouri and the nation — has focused in recent years on reducing and preventing unnecessary readmissions of patients.

St. Mary’s reduced its penalty from 0.48 percent to 0.26 percent by continuing to focus on developing and implementing effective discharge plans and dedicating registered nurses to post-discharge care from the moment a patient is admitted to the hospital as well as following up with patients by weekly or even daily phone calls.

“Seeing our readmissions rate drop was encouraging, and it told us we are working on the right things, going in the right direction,” said Teresa Elliston, care coordination director at St. Mary’s.

According to a Kaiser Health News analysis of the penalty data, 1,371 hospitals received reduced fines from last year while 1,074 hospitals received increased penalties. MU Health Care is joined by 282 other hospitals that are being fined this year for the first time.

Mary Jenkins said MU Health Care first made reducing hospital readmissions a strategic goal in March 2010, establishing a program focused on post-discharge calls to patients.

Jenkins said MU is taking a multidisciplinary team approach to include nurses, doctors, pharmacists and others in discharge planning and calling patients within 48 hours of discharge to check in. Registered nurse care coordinators meet with readmitted patients to review why the patient is returning and to use that situation to improve treatment of others.

The target goal set by the Centers for Medicare and Medicaid Services in 2013 for heart attack readmissions was 16.4 percent in 2013. Between June 2009 and June 2012, MU readmitted 17.7 percent of heart attack patients, which was lower than the national average but still higher than Medicare’s target, Jenkins said.

All eight of BJC Healthcare’s listed hospitals, including the Barnes-Jewish network of St. Louis area hospitals, decreased their penalties from last year or, like Boone Hospital Center, managed a second year of no penalty.

In Jefferson City, Capital Region Medical Center saw a penalty increase from 0.21 percent of reimbursements to 0.34 percent. The hospital has also been focusing in recent years on improving education of patients about post-discharge care, following up with phone calls and making sure patients understand what medication to take when.

“It’s not so much about the money — sure that’s top of mind, it is a business — but what’s most important is the outcomes of patients,” hospital spokeswoman Amy Berendzen said. “If we do that right, the penalties are a moot point.”

Not a perfect penalty

Hospital associations and some policy experts have been critical of the penalty but admit the costs of unnecessary readmissions are substantial. According to the Kaiser analysis, hospitals that serve low-income populations were more likely to struggle meeting Medicare’s benchmarks than others.

According to a February study from The Dartmouth Institute for Health Policy and Clinical Practice, “Many patients are readmitted simply because they live in a locale where the hospital is used more frequently as a site of care for illness, leading to both higher initial admissions and higher readmissions.”

The rate of readmission for patients discharged after a medical admission in 2010 varied from a high of 18.1 percent in Bronx, N.Y., to a low of 11.4 percent in Ogden, Utah, and the spread was even wider for patients hospitalized for surgery, according to the Dartmouth study.

The study cited instances of patients confused about diagnoses, medications and potential complicating factors, family members burned out from caring for loved ones and rushed discharged procedures as challenges the health care industry needs to address to reduce readmissions across the board.

Dave Dillon, vice president of the Missouri Hospital Association, said that in the first year of the penalties, Missouri hospitals experienced a total of about $8.5 million in penalties. He expects the total statewide penalties to be about $6.5 million this year.

Dillon said he thought readmission rates were not the best metric to penalize hospitals because post-discharge care is shared across community providers and the community itself, whereas the penalty affects hospitals only.

He also stressed that some hospitals “might be at greater risk for readmissions because cases are more challenging,” citing the state’s major research and teaching hospitals such as MU.

He said the association has raised its concerns with Centers for Medicare and Medicaid Services, and, though some changes were made in the 2014 rule, all of the rule’s problems have not been addressed, such as accounting for differences in the complexity of cases across hospitals.

“(The hospital staff) can do everything right and still have people come back,” Dillon said.

While he does not think readmissions is the best metric to use for determining penalties, Dillon said the rule has focused attention on the issue of unnecessary readmissions and forced hospitals to work more closely with other providers such as primary care physicians and pharmacies and to follow up more methodically with patients after discharge.

“Reducing readmissions makes good sense,” Dillon said.

‘Process improvement projects’

At St. Mary’s, case managers begin assessing discharge needs at admission, looking for needs such as walkers and oxygen tanks and checking on patients’ family support networks.

Glenda Raithel manages chronic disease nurses, who work alongside care managers, physical therapists, pharmacists and other units providing care in hospital to make sure a patient is ready for discharge.

“Our job is to get all of the pieces of the puzzle for that specific patient, so that they are ready to transition to home,” Raithel said. “And once they get home, we follow-through to make sure what we said we were going to do is actually getting done.”

The nurses call the patient within 72 hours of discharge and continue to stay in touch for a month after discharge.

“We’ll call them weekly or as much as every day if they need it,” Raithel said. “After each phone call, we assess, do they need a call tomorrow or in three days or does it need to be a week?”

Elliston stressed that they are not trying to discourage patients from returning to the hospital but rather focusing on reducing return trips that could be avoided.

“It’s not that we don’t expect people to come back — there’s going be people who need to come back — but we want to make sure that we’ve done everything on our end to give them the best opportunity to stay at home that there is,” Elliston said.

At St. Mary’s, the pharmacist will visit patients prior to discharge to make sure they understand their medication regiment — when to take what pills.

Regardless of whether the penalty is the most effective way to improve patient outcomes, it has focused attention on the problem of unneeded readmissions.

“Everyone’s talking about it, so when everyone’s talking about it, the knowledge level is ramped up … and the patients’ expectations have risen, too,” Raithel said.

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