Correlation between Low Readmissions and High Death Rates
Heidenreich et al. pubmed.gov/20650356
(2010) Journal of the American College of Cardiology, 56(5), 362-368.
Gorodeski, et al. pubmed.gov/20647209
(2010) New England Journal of Medicine, 363(3), 297-298.
American Hospital Association aha.org/research/reports/tw/11sep-tw-readmissions.pdf
(2011) Trendwatch September 2011
Krumholz et al. pubmed.gov/23403683
(2013) Journal of the American Medical Association. 2013 Feb.13; 309(6): 587–593.
Gilman et al. pubmed.gov/25092831
(2014) Health Affairs, 33, no.8 (2014):1314-1322
Deaths Caused by a Program to Avoid Readmissions:
Fan et al. pubmed.gov/22586006
(2012) Annals of Internal Medicine 2012 May 15; 156(10):673-83
Joynt et al. pubmed.gov/21325183
(2011) Journal of the American Medical Association. 2011 Feb 16;305(7):675-81
Rodriguez et al. pubmed.gov/21835285
(2011) American Heart Journal. 2011 Aug;162(2):254-261.e3
Joynt et al. pubmed.gov/23340629
(2013) Journal of the American Medical Association. 2013 Jan 23;309(4):342-3
Dr Ashish Jha, of Harvard's School of Public Health, told PBS, "If you look at, for instance, the U.S. News [and World Report] publishes its list of top 50 hospitals. Those hospitals tend to have very low infection rates, very low mortality rates, very low death rates. Guess what? They tend to have very high readmission rates, because they do such a good job of keeping their patients alive that many of them are readmitted."
Dr. Sunil Kripalani, of Vanderbilt University Medical Center told Fox News, "Among patients with heart failure, hospitals that have higher readmission rates actually have lower mortality rates. So, which would we rather have -- a hospital readmission or a death?"
1. MedPAC - Medical Payment Advisory Commission, bipartisan appointed by Congress
MedPAC, Report to Congress: Promoting Greater Efficiency in Medicare. June 2007
MedPAC, Report to the Congress: Reforming the Delivery System. June 2008
MedPAC, Report to Congress, Medicare Payment Policy. March 2012
MedPAC, Report to Congress, Medicare Payment Policy. March 2013
MedPAC, Medicare ACO Update, April 2013, Glass & Stensland
MedPAC, Report to Congress, Medicare & the Healthcare Delivery System. June 2013
MedPAC, Data Book. June 2013
MedPAC Report to Congress, Medicare Payment Policy, March 2014
2. See also Medicare Recommendations
1. Readmission Rules
42 CFR 412.154 - Regulations for the Hospital Readmissions Reduction Program.
Medicare's summary web page and separate page of information for FY 2016
August 4, 2014 Final Rule for Fiscal Year 2015 (which starts October 2014)
May 15, 2014 Proposal for Fiscal Year 2015 (which starts October 2014) or individual sections
August 19, 2013 Final Rule for Fiscal Year 2014 (which starts October 2013) or individual sections
May 10, 2013 Proposal for Fiscal Year 2014 (which starts October 2013) or individual sections
August 31, 2012 Final Rule for Fiscal Year 2013 (which started October 2012) or individual sections
2. Methodology for Counting Readmissions
3. Medicare Budget
President, The Budget for Fiscal Year 2014, April 2013
Dept. of Health and Human Services 2014 Budget in Brief, April 2013
Dept. of Health and Human Services 2014 Centers for Medicare & Medicaid Services Justification of Estimates for Appropriations Committees, April(?) 2013
Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds 2013 Annual Report, April 2013
Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds 2012 Annual Report, April 2012
Earlier Trustee Reports
Congressional Budget Office, Letter to Majority Leader, November 2009
"Estimate of Effects on Direct Spending and Revenues for Non-Coverage Provisions of the Patient Protection and Affordable Care Act By fiscal year, in billions of dollars.
... 2013 2014 2015 2016 2017 2018 2019 2010-2019
Hospital Readmissions -0.1 -0.3 -1.1 -1.3 -1.3 -1.4 -1.5 -7.1
Reduction Program" (p.26)
4. Accountable Care Organizations
42 CFR Part 425 - Medicare Shared Savings Program
December 21, 2012 ACO 2013 Program Analysis Quality Performance Standards Narrative Measure Specifications
November 2, 2011 Final Rule for ACOs
2011 Pioneer ACO Request for Application
2009 Physician Group Practice Demonstration Evaluation Report (PGP)
5. See also list of reports from MedPAC, a Congressional Agency
Hospital bills for 100 most common diagnoses, 2011 and 2012, for US and each hospital.
Explanation of General Medicare Payment Formula for Hospitals
The explanation is based on information from
Many numbers change each year. There are links to Medicare's "home page" of each year at the bottom of the main CMS readmission page.
Hospital operating base or "Specific standardized amounts"
Hospital capital base
Both hospital bases are multiplied by the DRG weight (Table 5).
Readmission reduction for "excess" readmissions in past years, based on operating costs plus payments for new technology, but excluding capital, and adjusted for transfers.
DSH for poor people
IME for teaching
Outlier payments for very costly hospital stays cover 80% of hospital losses over $23,000 (90% for burns). These total about $16 billion per year and they average about 2.9% of payments for most procedures, including the procedures subject to readmission penalties. They are higher on a few other procedures.
Summary inpatient costs released by Medicare include DRG amount (operating + capital), disproportionate share, teaching, and outlier payments. Operating cost (the base for readmission penalties) is about 73% of these summary costs.
Transfers after short stay get lower payment
New technology add-on payment (NTAP) added if applicable
Large Urban Areas get extra factor, meaning Metro Statistical Areas over 1 million people and New England County Metro Areas over 970,000.
Organ acquisition is paid separately
Value-based purchasing VBP has adjustments, based on operating costs, not capital.
Sole community hospitals (SCH) are paid by other formulas if higher
Medicare dependent hospitals (MDH) are paid by another formula if higher
Low volume hospitals get more, by formula
Qualifying hospitals are in the bottom quartile of counties on Medicare spending per enrollee, and get more
Hospitals not reporting quality data get reduction
Direct URL: drugs.globe1234.com
Patients can get independent information on drugs from the following (many track your IP address; you can check their privacy statements):
Cost and Number of Prescriptions, Overall, and for Each Doctor
Dr. David Belk has clear data on wholesale (NADAC) and retail costs of generic and branded drugs (from GoodRx) and what drives the costs.
Drug stores in half the states are not allowed to tell you if the cash price is less than your co-pay, but the other half of states have laws letting them tell you. You can always ask anyway.
You can find the number of drug prescriptions from each doctor and costs for Medicare patients in at least 2 places, described below. For non-Medicare prices see above.
ProPublica has Medicare Part D cost for each drug: number of prescriptions and total spending. You can get separate totals for US and each state, so you can get average cost per prescription, and for each doctor who prescribed a drug 50 or more times in 2013.
Medicare itself has more complete Part D data. The US and state summary files (bottom of the link) show for each drug: the number of beneficiaries as well as prescriptions and spending, so you can get average per beneficiary (total during a year), as well as per prescription for each drug.
Medicare's detailed files show number of days prescribed, so you can get average cost of a daily dose, as well as each doctor who prescribed a drug 11 or more times in 2013. This info is in 23 million records, without state or US summaries. However you can get good state and national estimates by opening any of their 36 spreadsheets (divided by last name of prescriber) and getting averages there. The average costs do not vary much by last name of prescriber. (Tips for working with large spreadsheets)
Some doctors and drugs typically have 30-day or 90-day prescriptions, which may be renewed all year. Their averages include the cost for each whole long prescription (30 or 90 days). Docs & drugs with shorter prescriptions only include that lower cost. Medicare's focus seems to be on cutting total costs, not cost per dose.
ProPublica's methodology says it has "retail cost" for these prescriptions.
Medicare's fact sheet gives more detail, saying it includes,
After seeing which drugs a doctor prescribes, you can find drug safety and effectiveness from the sources at the top of the page.
Most doctors send prescriptions to pharmacies electronically. This is more reliable than hand-written faxes, but two problems stand out:
Cancellation orders are crucial to correct mistakes and cancel refills. Patients can overdose when they keep getting the old medicine after the doctor orders a new one. Only a third of prescribers and 40% of pharmacies use software certified to handle cancellations, so less than a third of cancellations can go through. "Electronic health records allow prescribers to stop a prescription, but what many physicians may not realize is that in most cases that directive is not sent to any pharmacy," even though original prescriptions are reliably sent.
Health systems like the Veterans Health Administration and Kaiser Permanente, where prescriber and pharmacy are in the same organization, can cancel electronically. Otherwise only 5 pharmacy chains accept e-cancellations:
No other chain is certified for e-cancellation, such as Walgreens (16% of US prescriptions) and Walmart (7%). Consumer Reports unfortunately recommends Costco and Sam's Club for price (uncertified), Walgreens for its apps (uncertified), and supermarket chains for convenience (only Kroger's is certified). CR should know better.
Doctors can cancel electronically only if their software is certified under "Cancel Rx". Out of 920 systems, only 80 are marked as certified, and usually only the latest updates. If your doctor is part of a large group, you can ask the group to ensure its software gets certified and updated. Individual doctors have little control.
Automatic refills are even more dangerous. When pharmacies call patients to say, "Your prescription is ready," patients and callers do not know whether the doctor recently ordered it or it is a zombie renewal. Costco, CVS, RiteAid and Walgreens encourage patients to sign up for automatic refills, so patients at Costco and Walgreens (two which lack e-cancellations) can get undesired medicine for long periods, thinking their doctor ordered it.
Prior authorization for prescriptions is a system where an insurer tells a pharmacy that a doctor needs to send the insurer detailed information and get the insurer's approval for the prescription. Insurers tell pharmacies, not doctors or patients, when prior authorization is needed, and pharmacies say they have no obligation to tell doctors, though they have the forms and information which the doctor needs, and no one else does. A Massachusetts court says pharmacies must tell doctors, and a doctor says the entire circuitous system of prior authorization for drugs kills patients.
1. Hospital data
Financial data are on a separate page
Medicare has links to a "home page" for each year since 2012 (called IPPS Rule) at the bottom of the main CMS readmission page (and the bottom of the left navigation menu, which is often the only link for the coming year).
Item 4, the Readmissions file, is the source of "Number" and "Readmit Rate" for each of the 5 medical categories in our "Combined list" of all hospitals (methods). The file also shows the number of patients set aside from the data for various reasons (transfers, deaths, etc.), and the total DRG weights of readmitted patients (reflecting their costs).
Item 1, the Impact file, is the source of the price and wage adjustments in our Combined List.
Files of death rates and other quality measures for hospital and other patients. These ignore deaths of people who have been in hospice any time in the past year. (methods)
Medicare has data each year, called tables, on:
Hospital bills for 100 most common diagnoses, each year from 2011 on.
Medicare gives away software to calculate readmission risk. It focuses attention on the frailest patients who are most likely to be readmitted in spite of better care, so are natural targets to promote hospice, comfort care and DNR, even if their condition is treatable.
Data on hospitals' use of Electronic Health Records are on a separate Medicare page.
2. Nursing Home data are on another page
3. Patient and beneficiary data
Medicare has counts for each year since 1985, more detailed in the most recent years, and interviews with a sample of beneficiaries.
File of 15,000,000 hospitalized Medicare patients ($3,700 per year, on DVD)
Medicare Advantage Plans (Part C) encounters with patients.
4. Doctor and treatment data
Medicare has counts and costs for the procedures and tests billed by each doctor and other provider in 2012.
Data on doctors' use of Electronic Health Records are on a separate Medicare page.
5. Drug Use and Costs are on another page.
6. Medical Equipment
Medicare lists doctors who prescribe medical equipment and supplies, by type of equipment, showing numbers and costs, but the file is not organized by provider, so you cannot compare prices at different providers. The goal seems to be to press doctors to prescribe less, rather than help patients or doctors find the best or popular providers.
7. Other sources
Topics are also covered in the MedPAC, Data Book. June 2013
The Agency for Healthcare Research and Quality has data on costs and disease.
Medicare shows, by state or county, number of beneficiaries, as well as users and providers of ambulances, labs, home health, skilled nursing facilities, and hospices.
4. Pain and Palliative Doctors Compared
The Board Certification for "Pain Management" devotes far more time to assessment and treatment of pain, both drug and non-drug, and a little more time to psychological issues. The Palliative and Hospice subspecialty devotes more time to communication and death. Both devote similar time to legal and ethical issues.
Pain Assessment 14%
Diagnostic Testing 11%
Pain Assessment 4.5%
Types of Pain 12%
Pain Management 10.5%
Other Pain Topics 5%
Palliative Sedation <2%
Other Topics in Medical Management <2%
Psychological/Behavioral Aspects of Pain 10%
Psychosocial and Spiritual Considerations 11%
(of which 7% is psychosocial)
Compensation/Disability and Medical‐Legal Issues 7%
Ethical and Legal Decision Making 7%
Pain Medicine Therapies (Nonpharmacology) 15%
Additional Management Strategies (mostly nondrug) 2.5%
Anatomy and Physiology 15%
Approach to Care 9%
Communication and Teamwork 6%
Other Common Conditions (other than pain) 15%
Urgent Medical Conditions 5%
Prognostication and Natural History of Serious Illness 8%
Impending Death 9%
Grief and Bereavement 5%
Discontinuation of Technological Support (breathing, dialysis, etc.) 1.5%
All states now allow doctors to see patients by telehealth even from the first appointment, if they have the right license, but distant doctors refer too rarely to other local specialists, since they don't know them, so patients need to ask.
Industry sources include Concierge Medicine Today, Direct Primary Care Journal, and Direct Primary Care Coalition.
Some apps will call a doctor to visit you at home, or you can use lists here to find doctors who visit homes and assisted living, and call them directly to build a relationship with the same doctor over time.
Some computer systems go through your symptoms and tell you possible diagnoses. 19 systems ranged from 5% to 50% "right" on a 2014 test of 45 vignettes (sets of symptoms, 18 computer systems and one paper system), published in 2015. "Right" means the single diagnosis which the authors of the vignettes expected. No one checked if the other diagnoses offered were also fully consistent with the symptoms given, or perhaps even more consistent.
A long list of other systems use the same algorithms and would have had the same results. Many nurse help telephone lines use the same algorithms and would have about the same results, except when accuracy is changed by the nurses' own judgment.
When the systems were asked for the 3 most likely diagnoses, they included the "right" diagnosis as one of these 3 from 29% to 71% of the time, depending on system. Researchers at Harvard and 3 Boston Hospitals did the test. In 2016 they tested 234 doctors, who identified the "right" diagnosis 72% of the time and got it in their top 3 possibilities 84% of the time. Researchers did not report the range of accuracy from doctor to doctor, as they did for computer systems, but success did not vary much by level of training (intern, resident, attending doctor).
Amazon and Google are expected to expand into health care.
Referral services may give local or distant referrals.
ZendyHealth refers you to a local provider based on how much you want to pay ($49 referral fee). They cover only a few procedures, primarily imaging, tests, counseling, dental extractions or implants, cosmetic procedures. For these and other procedures they also refer you for a free consultation. More details are on the Costs page.
PinnacleCare charges $650 to set up a consultation with a specialist and transfer medical records.
GrandRounds.com (formerly ConsultingMD.com) refers patients to local or distant doctors for initial care or second opinions and transfers medical records to them. They charge $200 to arrange an initial office visit with a local doctor in the "top" 3% or 10% of local doctors, or $7,500 for a remote expert opinion from a doctor in the "top" 0.1%. They also charge $7,500 for "STAT," an emergency telephone consult with the best doctor they can find at short notice.
- The first time you use their services they need time to collect your health records from your doctors and hospitals, and (with your permission) provide them to the doctors they refer you to. They do not say whether your health records are encrypted while stored in their offices.
- They offer their telephone consult ("STAT") 24/7, but don't say how many hours it may take to find a relevant expert. They're ambiguous whether the expert talks to the patient/family or the treating doctor. If you cite both those links to them, you can insist they talk to both.
- The emergency STAT service is expensive, and is based on the idea that Grand Rounds has pre-identified doctors willing to consult by phone, which you would have trouble finding in an emergency. Dr. Kussin recommends that when you know what health conditions you have, make an annual appointment with a top specialist for a checkup, so you can call him/her as an existing patient in any emergency (p.206).
- The non-emergency $7,500 expert opinion seems aimed at big spenders. They warn you that the expert will not have "information that would be obtained by examining you in person and observing your physical condition." Without spending that much you can identify the top national experts in the Specialists tab above, and in your $20 subscription to UpToDate, call for an appointment, and go see them in person.
- Their $200 fee to recommend and set up a local office visit is reasonable. You pay them to research doctors and transfer records instead of doing it yourself. You and your insurance will still have to pay for the visit itself.
- A problem with Grand Rounds is that the terms of service require you to pay their legal bills for any problems which arise: "You agree to indemnify, defend and hold the Company and its directors, officers, employees, agents and contractors harmless from and against any and all claims, damages, losses, costs (including without limitation reasonable attorneys’ fees) or other expenses that arise directly or indirectly out of or from (i) your breach of any provision of these Terms, or (ii) your activities in connection with this Site." They don't provide any examples, but perhaps this would protect them if they misuse your information.
- Grand Rounds does not reveal its algorithm to identify top doctors, but says it includes: "Institution (is the physician associated with a top-quality one?), Training (where did the physician study?), Research (does the physician publish in his or her area of study?), Reputation (what do the physician’s peers think?)" Another page adds, "procedure volumes; and clinical outcomes." Another page says that the doctors' "success rates are well above national averages and that they follow state-of-the-art care practices." They say these top 10% doctors have "15% lower hospital readmission rates. 30% – 40% lower mortality rates, 20% – 25% lower complication rates, but again no information on how these differences were found, over what time frame, comparability of patients, etc. They describe their service as doing some of the same analysis this website describes, on procedure volumes, doctors rating other doctors, and researchers. They simplify the process, while hiding the details.
PinnacleCare and Private Health Management help wealthy clients navigate the health-care system, for $16,000 per year or more, plus the cost of care.
Luxury Suites at Hospitals
utsandiego.com/uniontrib/20050904/news_1n4hospital.html (associated press)
nydailynews.com/new-york/class-ward-lenox-hill-hospital-article-1.1186213 Nurse overwork on non-luxury floor
denverpost.com/news/ci_7746964 Claims a profit
dujour.com/lifestyle/luxury-hospital-accommodations/ They comment, "unclear whether hospitals are actually turning a profit from this enterprise. What they are doing, however, is cultivating future donors"
The Journal of the American Medical Association (JAMA) May 2 2017 summarizes a lot of research on how payments from drug and equipment companies affect doctors' decisions, usually sub-consciously. Where policies change or payments stop or start, average prescribing practices then change. Public Citizen has a less detailed November 2017 update.
Nurses also get payments and meals from drug companies, but only Massachusetts tracks these payments.
Drug companies also have constant access to doctors and give them biased information. A 2012 summary found (emphasis in the original):
- 61% of physicians reported that their own behavior was immune to influence by industry, but only 16% thought that other physicians’ behavior was equally secure
- sometimes the suggestion that such influence exists can be infuriating to them
- The frequency of meetings with pharmaceutical representatives varied across specialties, ranging from two per month for anesthesiologists to 16 per month for family practitioners
- representatives presented only selected, usually positive, information about their products
- In one of the few studies of specific [training] content, 11% of statements in formal lunch presentations by pharmaceutical representatives were found to be inaccurate, all favorable toward the promoted drug, yet only 26% of medical residents attending those presentations recalled hearing any false statement. All statements about competing drugs were accurate, but none favorable
- research supported by industry is more likely to report positive results—3.6 times as likely, according to one meta-analysis
- One study of industry-sponsored review articles and Cochrane [academic] reviews on the same medications found that all of the former recommended the drug in question whereas none of the latter did
- 85% of [US medical students] who thought that accepting a small gift or lunch was inappropriate reported accepting them anyway. This may be partially explained by the fact that 93% of the students had been asked or required by a faculty member to attend a sponsored lunch
- In one survey of internal medicine residents, 100% of those who thought interactions with industry were inappropriate accepted at least a lunch or a pen
- In a random sample of physicians in six specialties in the United States, 94% reported some relationship with industry (18). Eighty-three percent reported receiving food or beverages in the workplace; 78% received samples
- Clinicians often describe the role of samples as helping those who cannot afford medications to receive treatment... Physicians themselves report that samples influence them to prescribe drugs that differ from their preferred choices (32). Although the initial reason may be to avoid cost to the patient, most samples are of the newest and most expensive medications, which patients may not be able to afford after their samples run out. Further, the side effects of newer medications are usually less well established
Life Expectancy, by Age
CDC has instructions to doctors on filling out death certificates, but there are weaknesses, especially for the minority of patients who die without a recent doctor visit.
Average Years of Life Remaining, by Age, US Population, 2014
Life Expectancy, Accounting for Health Status
The C statistic is an estimate, from a research project on particular patients, how often an index is more accurate than chance. Values range from 0.50 (no better than chance) to 1.00 (always right). C statistics for different groups of patients are in supplementary tables 1-4 of Yurkovich et al. (2015) Journal of Clinical Epidemiology. v.68(1):3–14. "A systematic review identifies valid comorbidity indices derived from administrative health data." Details of how big the errors are may be found in the original studies, listed by Yurkovich et al.
An older study is Sharabiani et al. (2012 Dec) Medical Care. v.50(12):1109-18. "Systematic review of comorbidity indices for administrative data." . doi: 10.1097/MLR.0b013e31825f64d0 pubmed.gov/22929993
US Life Expectancy Stopped Improving
Life Added by Hospital Treatment
Table H. Lives Saved by More Hospital Treatment
Hospitals treated 60,000 fewer patients for heart failure in mid 2012-mid 2015, than in mid 2008-mid 2011, or 20,000 fewer patients during a year, compared to four years ago, before the penalties.
(Source, column CZ of: globe1234.org/hospitals1216.xls)
CDC says in the US:
- Death rates from heart failure fell every year from 2000 to 2012,
- Death rates from heart failure rose in 2013 and 2014.
- Source: cdc.gov/nchs/data/databriefs/db231.pdf, CDC instructions on defining causes of death: cdc.gov/nchs/data/misc/hb_cod.pdf
The term "heart failure" is also called "congestive heart failure" or cardiomyopathy. It refers to weak pumping because of muscle deterioration, stiffness, leaking valves, etc. It is not the same as a heart attack or heart stopping.
These are the latest national figures, but five earlier studies from 2010-2014 also found that hospitals which had fewer readmissions had more deaths, especially among heart failure patients.
Medicare said in August 2012, "We are committed to monitoring the measures and assessing unintended consequences over time, such as the inappropriate shifting of care, increased patient morbidity and mortality, and other negative unintended consequences for patients." (p.53376) They have not reported any of these monitoring results in 4 years.
The penalties apply to patients treated under Medicare Part B. Hospitals which face the readmission penalties now admit 5% fewer Part B patients for heart failure, even though the total number of seniors covered by Part B increased 12% in the same period.
Readmission penalties give hospitals incentives to treat fewer seniors. Medicare even gives hospitals an online tool to predict readmission risk for each potential patient.
Hospitals can avoid penalties by any mix of the following:
- Avoid admitting the sickest Medicare patients with heart failure ("There's not much we can do for you. Hospitals are dangerous. You're better off at home.")
- Treat as many as possible of the least sick outside of hospitals
- Change diagnosis to "hypervolemia," too much water in the blood, which is not penalized, but risky if caught
- Improve subsequent care for those admitted, to reduce readmissions
It is easier to give less care than to improve it, though hospitals certainly are doing both. And what we see is that death rates have started to rise.
The following hospitals had the biggest drops in heart failure patients admitted, comparing the most recent 3-year period to the 3 years before penalties:
St Vincent's Medical Center Riverside, Jacksonville, FL, -871 patients
Northwest Community Hospital 1, Arlington Heights, IL, -779 patients
Baptist Medical Center, San Antonio, TX, -724
Community Medical Center, Toms River, NJ, -570
St Luke's Hospital Bethlehem, PA, -543
King's Daughters' Medical Center, Ashland, KY, -536
Beaumont Hospital - Dearborn, MI, -517
Hackensack University Medical Center, NJ, -504
Vassar Brothers Medical Center, Poughkeepsie, NY, -454 patients
On the other hand these hospitals may have unique reasons for their changes, and the real story may be among all the other hospitals with smaller drops in heart failure patients. Changes at all hospitals are in a spreadsheet (in column CZ; changes in Part B enrollment are in column DL):
I counted hospital admissions in July 2012-June 2015, compared to July 2008-June 2011. These are the newest and oldest comparable data available. Medicare released the older data in a comparable form in May 2013. It released the newer data in August 2016.
Hospitals face readmission penalties when they treat Medicare patients for heart failure. Each hospital pays a penalty if more of their heart failure patients than the US average need another hospital stay within a month. So hospitals know they have a 50% chance of a penalty, since about half the hospitals will have readmission rates above average each year.
For pneumonia, which is the other of the three original readmission penalties, we have to compare 3 year periods ending June 2014 and June 2011, since Medicare expanded the pneumonia categories counted in later periods. Pneumonia admissions fell 4% over that period, while the number of Part B beneficiaries rose 9%. Death rates oscillate each year but were on a downward trend from 1999-2012. It looks as if the trend may not have continued in 2013 and 2014, though it is hard to tell.
Readmission penalties are large. Hospitals get $6,000 for treating a Medicare heart failure patient, but pay a $27,000 penalty for each readmission within 30 days, above the national average rate. For other conditions penalties range from $25,000 to $239,000 per readmission above the national average rate. So every hospital tries to be below the average, driving the average down and the risk of penalties up every year. There are also minimal adjustments for the mix of patients each hospital serves. Penalties total $469 million this year.
There are newer penalties for re-hospitalizing patients after coronary bypasses. The penalty is $188,000 for each one above the national average rate; penalties began October 2017. Penalties after elective hip and knee replacements are $239,000 and began October 2014. The penalty calculations are written into the Affordable Care Act. It is too early to see if the number of people treated has fallen, but the American College of Surgeons warned Medicare that treatment would be cut: "the potential that these hospitals will decrease their care for such patients, thereby creating an access issue."
In 67 metro areas, Medicare has a second way to discourage hip and knee replacements, especially for the frailest patients who may need them most: the hospital must pay nearly all medical expenses for 90 days after the hospital stay, though it has no control over these costs. Fewer hip and knee replacements and fewer coronary bypasses, when Medicare patients need them, condemn seniors to reduced activity and faster decline.
For heart attacks and coronary bypasses, Medicare plans the same approach of making hospitals pay 90 days of medical costs, starting July 2017, in 98 metro areas.
Another page explains some arithmetic behind the readmission penalty calculations, which give hospitals a strong incentive to serve fewer patients.
A. Example of One Hospital
B. Cutting Admissions Cuts the Readmission Penalty, for Any or All Hospitals
C. Cutting Readmissions in the Proportion at All Hospitals Leaves All Penalties the Same
D. Cutting Readmissions at Some Hospitals Shifts the Penalty
E. Other Approaches Do Not Cut the National Total of Penalties
G. Graphs of Heart Failure
The only way hospitals overall can reduce the national total of penalties they pay is by treating fewer patients. The arithmetic behind this statement is explained here.
The national total of penalties mathematically equals the penalty per excess readmission, times the number of excess readmissions. Excess means above the national average readmission rate.
A. Example of One Hospital
Consider a hospital with a patient mix similar to the national average (adjustments for patient mix are small, so most hospitals end up like the national average). Suppose this hospital admits 500 patients for one of the treatments subject to readmission penalties.
If the hospital readmits 125 patients, it has a 25% readmission rate.
Suppose the national readmission rate is 20%. At this hospital that national rate would have meant 100 readmissions expected.
The hospital has 25 excess readmissions (= 125 ~ 100).
Since readmission rates are fairly well spread above and below the average, close to half of patients are in hospitals with below-average readmission rates, and half are in hospitals with above-average readmission rates. The latter thus have excess readmissions and pay penalties on them. These hospitals face choices described below,
B. Cutting Admissions Cuts the Penalty, for Any or All Hospitals
Suppose the example hospital cuts admissions 4% without changing its 25% readmission rate:
When a hospital cuts admissions (from 500 to 480) while keeping a similar readmission rate (25%) in that smaller pool of admissions, it reduces four important counts:
- admissions (to 480),
- readmissions (to 120 = 25% of 480),
- expected readmissions (to 96, which is 20% of 480), and
- excess readmissions (to 24, which is 120 ~ 96).
If all hospitals cut admissions similarly, they all cut their penalties, even when their readmission rates do not fall.
Data show hospitals have reduced admissions for heart failure, heart attack and pneumonia, and thus reduced the total national penalties.
C. Cutting Readmissions in the Same Way at All Hospitals Leaves All Penalties the Same
Suppose all hospitals, on average, cut readmissions four percent (from 20% to 19.2%) without cutting admissions. They get no benefit, because the penalty per excess readmission goes up; it is controlled by another formula:
The penalty per excess readmission equals the cost of initial treatment divided by the national readmission rate (MedPac June'13 p.99).
For example suppose the initial treatment averages $6,000. A national readmission rate of 20% means a penalty of $6,000 / 0.2 = $30,000. But when the national readmission rate drops to 19.2%, the penalty becomes $6,000 / 0.192 = $31,250.
Suppose the hospital in the example above cuts readmissions 4% (same as the nation) from 125 to 120, without cutting admissions. Now it faces expected readmissions of 96 (= 500 x .192), and has 24 excess readmissions. Its penalty was $750,000 (= 25 x $30,000), and still is $750,000 (= 24 x $31,250).
When admissions stay the same and the national readmission rate goes down, the penalty per excess readmission goes up, and every hospital which manages to cut at the same rate as the nation keeps the same penalty.
D. Cutting Readmissions at Some Hospitals Shifts the Penalty
Hospitals shift the penalty to other hospitals when they cut readmissions. Suppose a hospital cuts its readmission rate by 4% instead of cutting admissions:
If other hospitals on average don't cut their readmission rates, so the national average stays at 20%, the example hospital's expected readmissions do not change (100 = 500 x 20%). The hospital's total readmissions fall from 125 to 120, so excess readmissions drop from 25 to 20, and the hospital's penalty drops 20%.
Now think nationally, where many hospitals cut readmissions. Think of a million patients with 200,000 readmissions (20%).
- (a) 500,000 patients were at hospitals with readmissions below average, and
- (b) 500,000 were at hospitals with readmissions above average.
- 300,000 each of groups (a) and (b) are at hospitals which cut their readmission rates by an average of 1% of admissions (such as from 25% to 24% of admissions at a particular hospital, or or 19% to 18%), so 6,000 admissions are no longer readmitted.
- 200,000 patients remain at hospitals with excess readmissions which on average make no change in their excess readmissions (some rise a little, some fall a little)
- Hospitals in group (b) which cut readmissions (call them "cutters") saved penalties on 3,000 excess readmissions
- National readmission rate will drop by 6,000 or 0.6% of the million admissions, from 200,000 to 194,000, which is from 20% to 19.4%
- All hospitals face an expected readmission rate which has dropped by 0.6 percentage points (readmissions as percent of admissions at each hospital)
- 500,000 patients at hospitals with readmissions above average (including cutter hospitals) face a lower cutoff for excess readmissions. The cutoff used to be 20% or 100,000, now it is 19.4% or 97,000, which adds 3,000 new excess readmissions, 1,800 at the cutter hospitals, 1,200 at the non-cutter hospitals
- Cutter hospitals cut their net excess readmissions by 1,200, not 3,000
- Penalty per excess readmission will rise from $30,000 to $30,928 (= $6,000 / .194)
- Cutter hospitals pay the higher penalty on all their other excess readmissions. If their 300,000 patients averaged 21% readmissions, which are now down to 20% readmissions, they had excess readmissions 21% ~ 20% = 3,000, and now have 20% ~ 19.4% = 1,800. So penalties dropped by $34 million, from $90 million to $56 million
- If the 200,000 patients at non-cutter hospitals also averaged 21% readmissions, they had excess 21% ~ 20% = 2,000 and now have 21% ~ 19.4% = 3,200, so penalties rose by $39 million, from $60 million to $99 million
- An unknown number of the 500,000 patients are at hospitals with readmissions between 19.4% and 20% which now also have excess readmissions and pay penalties.
Cutting readmissions at some hospitals reduces their penalties, and shifts the penalties to hospitals which did not reduce readmissions as much. Whether the shifting is exact depends on the detailed distribution of readmission rates among the hospitals
E. Other Approaches Do Not Cut the National Total of Penalties
The penalty and national total of penalties could theoretically be reduced by cutting the cost of initial treatment, but Medicare already cuts it as much as they think they can.
Arithmetically the only other way to reduce the national total of penalties is to narrow the dispersion of hospitals below the national rate: raising readmissions in hospitals below the national average. This lets more readmissions be in low hospitals than high hospitals. This does not cause the low-rate hospitals a penalty, and it cuts the number of excess readmissions for high-rate hospitals. No one advocates this or is working on it, and hospitals could not count on it as a strategy.
US Total =
(penalty per excess readmission) x (number of excess readmissions)
(initial payment / readmission rate) x (number of excess readmissions)
(initial payment / [total readmissions / total admissions] ) x (number of excess readmissions)
(initial payment x total admissions / total readmissions) x (number of excess readmissions)
So US Total =
(initial payment) x (total admissions) x (number of excess readmissions / total readmissions)
The last parenthesis, excess over total readmissions, reflects the dispersion of readmission rates. For example a ratio of 0.04 means the average penalized hospital has 4% more readmissions than the national average.
The ratio of excess over total readmissions has risen for pneumonia and dropped for heart conditions:
4.06% 3.91% Pneumonia
3.27% 3.70% Heart Failure
2.94% 4.07% Heart Attacks
4.77% Hip & Knee Replacements
3.39% Coronary Bypasses
G. Graphs of Heart Failure
A more plausible alternative of reducing all readmission rates at all hospitals does move down the dark blue and light blue lines, and does not change the ratio of excess to total readmissions, so it does not reduce the national total of readmission penalties.
The most recent penalties are in the readmissions spreadsheet, for fiscal year 2017 (10/1/2016 to 9/30/2017).
For other types of penalties, this site has older data, for 2015, in the financial spreadsheet, except Electronic Health Records (EHR, see below). United States and state totals are here. EHR totals by state for 2011-2014 are here.
A. HRRP: HOSPITAL READMISSIONS REDUCTION PROGRAM PENALTY
Formal readmissions penalty rules are at 42 CFR 412.152 and 154.
The number of excess readmissions at each hospital, for each diagnosis, derives from two numbers in Medicare's "Readmissions Supplemental File" for the current year:
- Medicare provides the ratio of each hospital's own readmission rate, to the national readmission rate (adjusted for patient mix): (readmit@hosp/admit@hosp) / (readmit@US/admit@US)
- The readmissions spreadsheet subtracts one from that ratio to get just the excess readmission rate at each hospital (still as fraction of national readmission rate): (excess@hosp/admit@hosp) / (readmit@US/admit@US)
- The spreadsheet then multiplies by the national readmission rate (readmit@US/admit@US), to get the hospital's own excess readmission rate: (excess@hosp/admit@hosp)
- The spreadsheet then multiplies by the number of admissions at the hospital (also provided by Medicare, in the same file) to get the number of excess readmissions at the hospital: (excess@hosp)
Medicare's full payment calculation is described in the Payments section. For the local cost level at each hospital, the readmissions spreadsheet calculates a weighted average of 2 numbers, which Medicare provides in the "Impact File" for the current year:
- Wage index for labor-related share of operations
- Cost of living factor for nonlabor share of operations (1 except in Alaska and Hawaii)
Besides dollar estimates described above, the readmissions spreadsheet also shows penalties as a percent of hospital revenue for each of the 6 diagnoses affected. Section F below explains how this is estimated.
In the financial spreadsheet the total readmission penalty at each hospital is Medicare's Readmissions Adjustment Factor times each hospital's "wage-adjusted DRG operating payment plus any applicable new technology add-on... [including] adjustment for transfers" (42 CFR 412.152), same base as VBP, with a different adjustment factor. Subtotals for the 5 diagnoses are based on the national cost of treatment and each hospital's excess readmissions, as shown in the readmissions spreadsheet.
B. HAC: HOSPITAL ACQUIRED CONDITIONS PENALTY
The 1% applies to all inpatient payments, including IME, DSH, outliers, uncompensated care, remote hospitals, early transfer. HAC penalties are calculated after deducting VBP and readmissions penalties (line 71, worksheet E in Medicare Cost reports, p.85 of the form in file R6P240f, 4 MB).
Formal HAC rules are at 42 CFR 412.170 and 172.
HAC penalties here are the same order of magnitude as found by a hospital software publisher 1/5/2015, with differences in detail, since they did not use Medicare's actual data.
C. VBP: VALUE-BASED PURCHASING PENALTY
Medicare provides the Adjustment Factors in .zip files, and calculates them from several measures (pdf item 25). The percent adjustments are scaled so the worst penalty is no more than 1.5% in FY 2015, 1.75% in 2016, 2% in 2017+, and the total bonuses equal the total penalties. After Medicare's correction, the actual range in 2015 was from a 1.24% penalty to a 2.09% bonus.
Formal VBP rules are at 42 CFR 412.160 to 167.
This "Value Based Purchasing" applies to hospitals, and is not the same as the "Value-Based Payment Modifier" also called "Value Modifier," which applies to doctors and doctor groups.
D. IQR: INPATIENT QUALITY REPORTING
The IQR payment cut is half a percent of inpatient payments. It is actually a quarter of the "increase in the market basket index" 42 CFR 412.64(d)(2)(i)(C). The annual increase in the market basket is 1.9% to 2.1% per year in FY2015, so a quarter of it is half a percent.
According to 42 U.S.C. 1395ww(b)(3)(B)(i), the IQR cut applies to 1395ww(d) "Inpatient hospital service payments" and 1395ww(j) "inpatient rehabilitation services". The financial spreadsheet therefore multiplies the half percent penalty by the total of inpatient hospital service payments, the same base as HAC above, or line 71 of worksheet E in the Medicare Cost reports.
Medicare says the IQR cut is 2%, which was true in FY 2007-2014: 42 CFR 412.64(d)(2)(i)(B).
Formal IQR rules are at 42 CFR 412.140 and 412.64(d)(2).
E. MU EHR: MEANINGFUL USE OF ELECTRONIC HEALTH RECORDS
Incentive payments are a fraction of $2 to $6.37 million dollars per hospital, depending on number of patients discharged. The fraction paid in FY2015 is half of Medicare's fraction of the non-charity care (in FY2016 it is a quarter). Medicare has released the 2011-2014 incentive payments for each hospital (bottom of their data page, or see US and state totals). The peak year was 2013, when $4.6 billion went to 3,453 hospitals, an average of $1.3 million per hospital.
Penalties apply starting in 2015 to 200 hospitals for insufficient use of electronic health records. Medicare provided that number in a press briefing, but Medicare has not provided the list of hospitals with penalties, "We do not have the list posted publicly and at present do not intend to publicly post it until the appropriate disclosure reviews and analysis of the potential impact are completed" (email 4/9/15). The penalty in FY2015 is half a percent of inpatient payments (1/4 of market basket increase, the same amount as IQR, though on different hospitals): 42 CFR 412.64(d)(3)(i). It will double to half the increase in the market basket in FY2016 and 3/4 in FY2017 and later years (factsheet).
Meaningful Use means reaching 16 objectives with electronic health records. Outsiders have criticized it for perfection: missing any objective earns the full penalty. Outsiders have also criticized electronic records as a recipe for data breaches and impersonal interaction with doctors. In 2015, Medicare drafted changes, which were summarized by Modern Healthcare.
Formal MU EHR rules are at 42 CFR 412.64(d)(3) through (5) and 42 CFR 495
Finding electronic records for a patient is hard, since most names and birth dates are common. Other items like address, phone number, and insurance number can change. All items can have typos. Addresses can be abbreviated many different ways. Some people do not want to give their Social Security numbers, which can have typos too. In the last 100 years, there are only 36,500 unique birth dates. Some names are more common than that, and even names held by just a few thousand people can have common birth dates, since some names were common in some years. Medical systems try to avoid matching you to anyone else's records, so they may not match you to your own records if there is any ambiguity. Study by Pew.
F. READMISSION PENALTY PERCENTAGES
By definition, the total penalty is the number of extra readmissions (above the national rate) times the penalty for each. The total revenue is the number of admissions times the payment for each admission:
total penalty = #extra readmits x [penalty for each]
total revenue #admit x payment for each admission
As MedPAC says, the penalty equals the [payment for each admission, divided by the national readmission rate]
total penalty = #extra readmits x [payment for each admission / US readmission rate]
total revenue #admit x payment for each admission
which simplifies to:
total penalty = ________#extra readmits
total revenue #admit x US readmission rate
That denominator is the number of expected readmissions, since Medicare expects the US rate to apply to every hospital, with a small adjustment for patient mix.
total penalty = #extra readmits (adjusted for patient mix)
total revenue #expected
If we add 1 we get (adjusted for patient mix):
total penalty + 1 = #extra readmits + #expected
total revenue #expected
Remember the "extra readmits" means just actual readmits above those expected based on the national rate, so in the numerator, #extra plus #expected are the #actual
total penalty + 1 = #actual readmits
total revenue #expected
total penalty = #actual readmits − 1
total revenue #expected
Medicare provides this last ratio, #actual / #expected, adjusted for patient mix, so the spreadsheet subtracts one, to display total penalty / total revenue. Each calculation is approximate, because of the adjustment for patient mix, but those adjustments are small and average out across the country.
A reader wanted to know when updates happen, so I will try to list them here, starting July 25, 2014.
2018 Oct 29 - added treatment links to drugs page. Updated advance directive form and CPR info.
2018 Oct 5 - added note about 2019 readmission penalties. Updated information on VA hospital quality.
2018 Oct 2 - moved Coma explanations to a new section. Updated AMA guidance on patient-doctor negotiations about end of life care
2018 Sep 12 - updated data and graph on CPR and DNR
2018 Sep 9 - added comparison of ways to let medics reach your emergency information instantly online.
2018 Sep 8 - added deadly results of measuring medical outcomes in Veterans Affairs Medical Centers
2018 Aug 13 - added non-Medicare cost data for drugs and office visits.
2018 Aug 8 - added new guidelines for coma prognosis and videos to page on medical representatives
2018 Aug 1 - updated penalties on nursing homes for sending patients to hospitals too often
2018 Jul 27 - added links on telehealth, nursing home data, and Medicare Advantage data on encounters with beneficiaries
2018 Jul 6 - added links on Medicare premiums and FDA regulation of software apps.
2018 Jun 20 - added to advance directives page: report on Gosport hospital overprescribing painkillers, causing deaths of 456-656 patients, and added to drugs page: complexities of prior authorization
2018 Jun 14 - updated data on specialists 2012-2016
2018 Jun 3 - updated medical travel
2018 Mar 5 - Added pills advice and international comparisons
2017 Nov 7 - Added life expectancy adjustments for health status
2017 Sept 21 - Updated maps
2017 July 14 - Added 2015 map and spreadsheet of appointment lengths for general doctors
2017 June 19 - Added 2015 list of specialist doctors
2017 May 25 - Added Conflict of Interest to doctor ratings page
2017 May 23 - Updated FOIA page and spreadsheet of all agency processing times
2017 May 10 - Updated ACO public information, waivers, odds of a bonus for cutting patient care.
2017 Apr 27 - Added Medical Letter to Drugs page and Eye issues to Specialists page
2017 Apr 15 - FOIA results, response times, fees, settlement negotiations
2017 Mar 10 - Added detail on problems with e-cancellation in Drugs page
2017 Feb 27 - Rearranged Specialists page, highlighting and expanding Step C - Other Information for Choosing Doctors
2017 Jan 30 - Wider text, more on costs and referrals
2016 Dec 8 - added sites on FOIAs
2016 Nov 23 - estimated 8,000 heart failure deaths per year, caused by readmission penalties
2016 Nov 3 - rearranged penalty calculations and hospital quality. Added NICHE levels of geriatric care
2016 Oct 21 - updated readmission penalties to FY2017, with bypass operations for the first time. Added detail on Healthgrades data about hospitals and doctors
2016 Sep 27 - noted BCBS of NC costs on Specialists page
2016 Sep 18 - new format to name medical representative and noting organ donation.
2016 Sep 7 - updated codes for medical procedures with 2014 costs and volume
2016 Aug 30 - gave links to search for hospitals with the most experience in each procedure
2016 Aug 26 - put specialists on a new page, and re-wrote it with instructions for using Medicare's interactive site to search for specialists.
2016 Aug 23 - corrected patient strategies to note how hard it is to drop Medicare Part A.
2016 Aug 22 - lists of independent doctors and nursing home organizations
2016 Jul 8 - 2012-2014 data on 683,000 doctors & others, to find those who give long appointments & treat you in multiple settings
2016 Jun 10 - Signs and letters written by Medicare, telling patients about ACOs
2016 Apr 2 - Doctor's incomes, hours, satisfaction, discipline
2016 Jan 6 - More info on Drugs
2015 Nov 30 - Renamed Advance Directive Form to emphasize Medical Representative, and updated CPR statistics with success outside hospitals.
2015 Nov 17 - Improved labels in financial data, and added Google sheet of doctors' office hours.
2015 Oct 22 - Improved labels in office hours data, and gave numbers of new patient appointments instead of the ratio between later and new appointments.
2015 Oct 16 - Updated Hospitals.xls+Penalty.xls with minor price changes issued Oct.5. Also corrected total US penalties to exclude Maryland, which is exempt from penalties. Removed blank columns, since sorting is sometimes blocked by blank columns. Reformatted advance directive pdf. Clarified definition of 1st visit with a patient.
2015 Oct 3-6 - Linked to better file to find doctors' phone numbers. Described California's ratings of hospitals. Stressed agent in advance directive. Expanded Excel instructions. Noted new data on types of patients seen by each doctor.
2015 Sep 30 - Added links on selecting medical representative; changed background photos
2015 Sep 2 - Better labels for Doctors, dropped diabetes education (30') to stay under 200 MB
2015 Aug 22 - Clarified doctor files & advance directives; added a Creative Commons license
2015 Aug 9 - Added data on hospitals cutting treatment.
2015 Aug 6 - Slightly better sort of Doctors, added longer patient education, better labels of countries
2015 Aug 5 - Updated readmission penalties to October 2016
2015 July 25-31 - Compiled ratings of doctors on one page
2015 July 1-9 - Added length+number of appointments for 636,000 generalist doctors. Updated data on 230,000 specialists. Better advance directives.
2015 Jun 12 - Simplified example of advance directives
2015 Apr 25 - Added percent readmitted for various causes
2015 Apr 7 - Added state totals for each penalty
2015 Mar 20-23 - Added penalties, address, latitude + longitude to Hospital financial statements. Fixed omission of last character of amounts. Expanded description of penalties.
2015 Mar 14 - Added name, address, phone & hospital chain to Hospital financial statements
2015 Mar 4 - Re-ordered columns, and added web links in spreadsheets of doctors
2015 Mar 3 - Added spreadsheets of Hospital financial statements, and highest-volume 25 doctors for each procedure
2015 Mar 2 - Added note on how high-volume doctors get their start
2015 Jan 15-Feb 22 - Article on Advance Directives
2015 Jan 23-26 - Reduced readmission penalty estimates, to omit capital and other costs which are not subject to penalties, and use Medicare's October updates.
2015 Jan 7-14 - Split off sections about unnecessary care, knees, legal searches & patient reviews
2014 Dec 31 - Published article on selecting doctors by experience & other measures
2014 Dec 30 - Updated ACO list with 89 new groups starting in 1/1/2015
2014 Dec 18 - Corrected in my files, errors which Medicare had in 650 doctors' state or zip code.
2014 Dec 1-12 - Added research on doctors' experience
2014 Nov 29 - Added maps of doctors' experience
2014 Nov 26 - Added more complete files on doctors' experience
2014 Sep 8 - Added input on 2015 Dietary Guidelines
2014 Sep 2-5 - Added comments on Medicare ACO rules, an option to create nutrition graphs in USDA file of nutrients, and more comparisons of protein sources, in site & USDA file.
2014 Aug 22 - Re-sorted USDA file of nutrients, added nutrition labels for protein alternatives
2014 Aug 18 - Added Calories in the nutrition labels proposed in the salt section, and identified almond milk with less sodium than average
2014 Aug 7 - Updated readmission rates and penalties with data from p.756 of Medicare's final rule, instead of p.1495. Both tables have the same title and have slightly different numbers. Medicare says p.756 applies to readmissions penalties.
2014 Aug 6 - Added the idea of clearer Explanations of Benefits, as a cost-saving alternative
2014 Aug 4 - Updated readmissions with data released by Medicare today
2014 July 27 - Listed doctors' experience on home page, with files on the Northeast and elsewhere
2014 July 25 - Adjusted readmission penalties at each hospital, for variations in local costs
91% of dialysis patients do not participate in Accountable Care Organizations, which have their own incentives to cut costs, so Medicare is trying to set up groups just for kidney patients. These are called End Stage Renal Disease seamless care organizations (ESCO). Dialysis patients are "1.3% of the Medicare population and accounted for an estimated 7.5% of Medicare spending, totaling over $20 billion in 2010."
ESCOs will receive 50%-75% of Medicare's savings on dialysis patients, compared to baseline costs. "Members must place their fiduciary duty to the ESCO before the interests of any ESCO participant" (Medicare's explanatory slides p.39)
They have 23 quality measures, one of which is the death rate. Medicare has not yet announced the weight to be given each measure, but judging by weighting for Accountable Care quality measures, no one measure will have much weight, including the mortality rate, so ESCOs can meet quality standards without minimizing deaths. Since a death stops all costs, the financial rewards for death are large.
Each "beneficiary’s first visit to a given dialysis facility during a particular period will prospectively match that beneficiary to the dialysis facility, and by extension the ESCO, for the upcoming performance year" (Request for Applications-RFA p.12). So a patient can avoid the incentives by changing to another dialysis facility, not part of the same ESCO. An email from Dr. Alefiyah Mesiwala, Medicare's leader for the program, says, "Once a beneficiary is seen by an ESCO facility, they are then matched for the life of the entire model unless the beneficiary dies, has a transplant, or becomes ineligible as stated in the RFA. Once a beneficiary is aligned to a facility, even if that beneficiary visits multiple facilities or providers in a given performance year, all costs associated with that beneficiary will be attributed to the ESCO facility the beneficiary was initially matched to per the matching rules outlined in the RFA" (5/5/2014).
The "first visit" rule gives an incentive for dialysis centers to be unable to find space for high risk patients (old or with multiple sicknesses), so they go to another ESCO at least for the first visit.
When patients find themselves in an ESCO, patients can avoid the cost-cutting incentives by finding a dialysis center which is not part of the same ESCO, and using doctors who are also not part of that ESCO. These other centers and doctors will not face the conflict of interest of being rewarded for cutting costs, so patients are more able to trust their recommendations and treatment decisions.
Dialysis companies and researchers doubt the ESCOs will be successful.
Medicare wants comments by September 8 on fining hospitals in a quarter of metro areas, if their patients who get knee or hip replacements have total Medicare costs above average. "Total" includes costs far beyond the joint replacement, since it includes continuing treatment of pre-existing chronic conditions, like diabetes, dialysis, AIDS, etc. (here, here, and here).
This is rationing by denial of costs: patients with chronic diseases would continue to have above-average costs even after perfect joint replacements, which hospitals cannot afford. So they will hear, "You are not a good candidate for joint replacement." Yet these chronically ill patients especially need the improved mobility and ability to exercise that a joint replacement can provide. Medicare acknowledges that hospitals will try to reduce costs as part of this program, which is why they exclude their favorite technologies, "We do not believe it would be appropriate for the CCJR model to potentially hamper beneficiaries' access to new technologies."
The Center for Healthcare Quality and Payment Reform has a good analysis. Patients with above-average Medicare expenses would be able to avoid the lack of local treatment by going outside their area, reminiscent of the days when divorce or abortion were legal in some states, and people traveled to get them. The adopted final program lists the areas covered in a table. As usual Medicare excludes Maryland, where Medicare has its headquarters and many Medicare family members and retirees live. This time they exclude Washington, DC too. They cover New York City and much of New Jersey, so patients will need to go upstate, or to Connecticut or Long Island. They cover Los Angeles and Orange counties, so patients will need to go to Ventura, Santa Barbara, Riverside, San Bernardino or San Diego. It will be interesting if orthopedists get hospital privileges in those outer counties, to treat their higher-cost patients.
However hospitals and doctors will not be able to tell sicker patients that they might easily get treated in another county, since Medicare will monitor and penalize their efforts to shift care. Patients will have to find out on their own, while lacking mobility because of the poor joint.
"An unintended consequence of a payment model such as (this) may be the 'cherry-picking' of low risk patients," according to a February article written by Drs. Alexandra Page and Mary O'Connor, posted on the website of the American Academy of Orthopaedic Surgeons. "Health systems and surgeons will be subject to financial incentives to avoid patients at higher risk of complications and hence, more expensive care." The two doctors are being polite to call it "unintended." Medicare has been warned about cherry-picking repeatedly, so it is clearly Medicare's goal.
You can read comments on new incentives for Accountable Care Organizations to reduce care, which were due September 2, 2014, including mine.
At the same time the Center for Healthcare Quality and Payment Reform provided substantial and critical comments on other aspects of hospital payments which can hurt patients.
You can read comments on hospital payments which were due June 30, 2014, including mine.
The public submitted comments to Medicare's 2013 rules by June 25, 2013, and you can read them, including mine.
The American College of Surgeons commented to Medicare that doctors and hospitals do reduce care when they respond to readmission penalties and other incentives:
- "penalizing hospitals that care for the highest acuity Medicare patients and the potential that these hospitals will decrease their care for such patients, thereby creating an access issue."
- "catheter is removed as soon as possible in order to comply with the measure, resulting in complications"
- "incentives to limit access to care to such high risk patients [with resistant infections]"
- "discourage the early diagnosis of PE or DVT [clots]... encourage the use of overly aggressive anticoagulation immediately after surgery."
- "decrease in care of patients with small bowel obstruction"
80 Members of the House of Representatives have co-sponsored bill HR 4188, which redefines readmissions to omit "transplants, end-stage renal disease, burns, trauma, psychosis, or substance abuse." This change protects those patients, but half the hospitals will still be above the national average, pay large penalties, and have incentives to deny care to fragile elderly outside these protected classes.
Please support a better fix: ask Congress to change HR 4188 to redefine "excess readmission" in1886(q)(4)(C)(ii) rather than "readmission" in 1886(q)(5)(E). This technical difference means the national average would not change, and the narrower definition of "excess readmission" means far fewer hospitals would be above that national average and face penalties.
4 Senators have introduced a bill to adjust readmissions for income, education, and poverty rate of the patients or neighborhood of the hospital, so hospitals which serve poor or poorly educated patients are not penalized.
It's also aimed at primary care physicians looking to find details about specialists' practice, when deciding where to refer patients having various conditions.
The site covers specialist doctors, generalist doctors, privacy, salt as a nutritional and practical issue, hospitals' financial position, government penalties and incentives. It has a large amount of information on Medicare, because of Medicare's pervasive influence on care.
The site editor is Paul Burke, an independent researcher who has managed and analyzed data for HUD, Congress' Office of Technology Assessment and the UN Development Program.
He is not financed by Medicare or the healthcare industry. There are links to some books with helpful information, but they do not generate fees for the site.
His career has focused on analysis of data.
- He has consulted for the UN Development Program on issues in education, development, the environment, economics, poverty, gender, and government spending.
- He chaired the committee on member surveys of a health care cooperative with 100,000 members in the 1980s.
- He has led seminars at the University of California-Berkeley, Columbia University, Fordham University, Venezuela's National Council on Human Resources, and the International Labor Statistics Center of the US Department of Labor.
- He was President of the Jefferson County (WV) Planning Commission.
- For HUD he designed and analyzed national surveys. He did research on planning, counseling, subsidized and free-market housing.
- As a sworn Census agent, he analyzed data about individuals on the Census Bureau's head office mainframe.
- He has an undergraduate degree in Mathematics, and a Master's degree in Interdisciplinary Urban Studies, both from Brown University.
- He also has a website on election security, VoteWell.net
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2015 August 10 - Hospitals Treat Fewer Seniors when Medicare Charges Penalties
2014 August 6 - Hospitals Fined $529 Million, or here
2014 May 30 - Readmission Penalties Put Burdens on Hospitals, or here
Coverage by Bloomberg BNA
2013 August 14 - Size of Readmission Penalties, or here
Coverage by EHRIntelligence, Orthopedics This Week
Accountable Care Organizations:
2014 July 15 - Medicare Plans to Penalize Hospital Use, or here
2014 February 12 - Medicare Pays Doctors To Cut Treatment
Comments on 2015 Diet Guidelines
Writing for Older Adults
For readers who need to analyze the statistics here, there are suggestions in the page on Excel, including links for statistics at the bottom of that page.
Here are some thoughtful articles on presenting information.
- CMS Toolkit Part 9, "if your written material is for older adults"
- HHS Health Promotion,tips for websites
- NIH MedlinePlus Health Literacy issues
- NIH, "Making Your Printed Health Materials Senior Friendly"
- Institute of Medicine, "A Prescription to End Confusion"
They published only 4 of the ability questions. The 4 questions have big flaws, as is typical in Education Department surveys. Health issues are indeed hard, but this survey did not measure well. They said:
- 74% answered correctly question N110101 on why finding one's blood pressure is hard*
- 64% answered correctly question C080201 by finding a small warning in a medicine label. However the real-world problem isn't finding this warning when you're told to look, the problem is taking time to look, and then remembering all the warnings.
- 60% answered "correctly" question C080101 aboutwhat time to take a medicine which must be 2 hours after lunch. The question said when lunch started, not when it ended, so the right answer depends on how long you think lunch takes.
- 40% answered correctly question N110201 by calculating the Black death rate from the White rate and the ratio of the rates*
Address cleaning provided by Texas A&M University GeoServices
You can read comments on new incentives for Accountable Care Organizations to reduce care, which were due September 2, 2014, including mine.
You can read comments on Hospital Readmission Penalties which were sent by June 30, 2014, including mine. You can also read comments which were submitted in 2013, including mine.
Privacy in the Medical Field
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