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Garden State Hospitals Lead Nation in Penalties for High Readmission Rates

Federal agency penalizes problematic readmission rates by reducing Medicare reimbursements

The federal government penalized all but one New Jersey hospital this year for having too many patients readmitted soon after they were discharged -- and will receive lower Medicare reimbursements as a result.

New Jersey ranked the worst in the country in terms of overall share of hospitals that will be penalized this year, although the range of penalties was wide, with some facilities only receiving minor fines.

The practice of penalizing hospitals for frequent readmissions was introduced as part of the Affordable Care Act; the idea was that this program would serve as an incentive to help ensure that patients stayed well after being discharged. Each year, the federal Centers for Medicare and Medicaid Services (CMS) reviews each hospital’s statistics and determines a range of penalties, reducing Medicare reimbursements from 0 percent to 3 percent.

Hospital officials from across that spectrum said that the Readmissions Reduction Program has served as a wake up and is motivating them to make further improvements, which they expect to be reflected in the penalties next year.

Palisades Med Center
Palisades Medical Center had the highest readmission rate in the state; Medicare reimbursements were reduced by 2.49 percent.

Sixty-four of 65 hospitals in the state were penalized by the CMS. The fines range from 2.49 percent for Palisades Medical Center in North Bergen to 0.01 percent for Saint Barnabas Medical Center in Livingston. Bergen Regional Medical Center, which serves many patients with behavioral-health issues, was the only hospital in the state that wasn’t disciplined.

New Jersey hospitals made progress this year, with the average penalty dropping from 0.79 percent to 0.72 percent. Only Kentucky, Virginia, West Virginia, Arkansas, and New York had higher average penalties, according to Kaiser Health News. The penalties will take effect starting on October 1. It is the fourth year of the program, with this year’s penalties based on patient data from 2011 through June 2014.

Palisades Medical Center Chief Nursing Officer Ruben Fernandez said the hospital made changes intended to reduce readmissions last year, when its penalty was 2.65 percent.

“What we have done is taken (the penalty) as an opportunity to look internally” at how the hospital manages the discharge of patients, Fernandez said. The hospital is supplying more data to patients’ primary-care providers and ensuring that patients have a plan of care that reduces the possibility of readmissions. He added that the hospital’s internal data indicates that its penalty should drop again next year.

Barnabas Health Chief Medical Officer Dr. John F. Bonamo said the penalties have caught the attention of the entire healthcare system.

“I think we in the healthcare world have been asked to step up and make our patients better. We were really not focused on the patient once they were discharged,” Bonamo said. “This has made us take notice, and I think it’s a good thing.”

Saint Barnabas’ success -- its penalty has dropped each year -- has inspired its parent system to copy its “transitions of care” program at all seven of its hospitals.

In this program, the hospital screens all patients when they enter the hospital and assigns them a score for their risk for readmission, based on their condition and medical history. They then assign a nurse practitioner to meet with high-risk patients while they are still in the hospital and to follow up with a visit to the patients’ homes within 48 to 72 hours of discharge. They continue to check in on patients for the next 30 days, ensuring that they stay on track.

“It seems like we’re really starting to see some success; we’re starting to see the needle move,” in reducing readmissions, Bonamo said, adding that the program was replicated at all Barnabas hospitals beginning in January. “We think it’s important. It’s good care for the patients, and it keeps people out of the hospital.”

National organizations have raised concerns that the penalties don’t account for the social and economic factors that affect patients’ health, leaving some hospitals that largely serve poor populations with persistently high penalties. The National Quality Forum, a nonprofit dedicated to improving healthcare quality, is supporting a study of how social and economic factors affect readmission rates

Aline Holmes of the New Jersey Hospital Association shares these concerns, based on research the NJHA has done.

“It does make a big difference if you’re a Medicaid beneficiary in Newark or Paterson. It’s hard for them to find a Medicaid provider who’s going to see them in the suggested 10 days” after discharge from a hospital, said Holmes, the association’s senior vice president of clinical affairs.

Other factors that contribute to higher readmissions rates include language barriers; lack of access to high-quality food, which contributes to chronic conditions like diabetes; cultural concerns with allowing strangers into homes; and safety concerns that can interfere with home-health visits.

“It’s a very complicated kind of an issue,” Holmes said, adding that fundamental issues of how community is built are at the heart of whether older patients make repeated trips to hospitals.

These patients are some of the “frailest of our populations. We really need to design communities that can support these folks,” she said.

She emphasized that the members of the hospital association, through its Partnership for Patients program, have made readmissions a priority, contributing to two-thirds of the hospitals making progress.

“A third still have some work to do,” Holmes said.

Bonamo said he’s glad that the social factors that determine people’s health and readmissions are getting the attention they deserve.

“I’m very encouraged that people are finally starting to understand that,” he said. “Housing, transportation, food challenges -- all of the things that people who are challenged financially from a socioeconomic perspective have to deal with -- they have a lot to do with their health.”

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