Reduction in Hospital Re-admissions Results in Medicare Savings

By | January 23, 2013

Now Medicare is doing something about it, and it is saving money.

About one in five Medicare patients who are hospitalized end up bouncing right back within 30 days, so reducing unnecessary hospital readmissions has become a bit of a holy grail.

The 2010 health reform law includes new penalties for hospitals that have particularly high rates of repeat Medicare patients — sometimes called “frequent fliers” — for three specific diseases. The law also creates incentives and programs through Medicare for hospitals to improve discharges and the transition from the hospital back to the community — where lots of things can go wrong and do go wrong, setting the stage for that patient to go home and ricochet right back in.

Now a major multicity Medicare quality initiative, highlighted this week in The Journal of the American Medical Association, has reduced readmissions by nearly 6 percent compared with similar communities over two years. The authors estimate that in an average community with 50,000 Medicare patients, spending $1 million on relatively simple steps to curb hospitalizations would save $4 million per year on hospital bills alone. That would add up fast if these programs were to spread nationwide.

And improving care in the community didn’t just slow readmissions. It reduced all Medicare hospitalizations, not just those round trips.

“We didn’t just bend the [cost] curve — we turned it down, enough to be convincing,” study co-author Joanne Lynn, a leading geriatrician now at the Altarum Institute’s Center for Elder Care and Advanced Illness in Washington, told POLITICO.

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Moss of the solutions to the readmission problem is to make sure that the patient is stable for discharge before the release, and more importantly, make sure they have after care. Patients need to be connected to community agencies that work with the elderly to make sure that their post admission needs are met and are educated about self care.