dr-r-wuebkerReducing avoidable readmissions rapidly is becoming one of the biggest hot-button issues for hospitals, and it’s a matter that involves both medical necessity compliance and patient care concerns.

The Centers for Medicare & Medicaid Services (CMS) reports that 18 percent of Medicare patients are readmitted within 30 days of discharge, and the agency believes that many of these readmissions are avoidable and/or unnecessary. A growing number of programs across the country have demonstrated improvements in the discharge and aftercare process, also known as care transitions, and such improvements can result in a significant reduction in readmissions, reducing overall healthcare costs and improving care quality.

For several years CMS has indicated that rising numbers of readmissions, and especially readmissions clinically related to an initial hospital stay, were responsible for a large portion of Medicare costs. A landmark New England Journal of Medicine article published in 2009 identified a 19.6 percent rate of readmission within 30 days, increasing to 34 percent at 90 days, for Medicare fee-for-service beneficiaries. The study noted that half of those readmitted within 30 days lacked evidence of a physician office visit occurring between discharge and readmission.

At the same time, CMS noted that hospitals were being rewarded for readmissions via additional DRG reimbursement. Medicare Quality Improvement Organizations (QIOs) long had been responsible for monitoring readmissions by performing occasional audits, however this was not effective in reducing overall readmission rates. It has been estimated that Medicare could save an estimated $12 billion through improvements in care transition at the time of hospital discharge. Policymakers have incorporated financial disincentives in the Inpatient Prospective Payment System (IPPS) to take effect in FY 2013 to encourage further reduction in the rate of related, avoidable readmissions in several key diagnostic categories, including heart failure, acute MI and pneumonia.

The drivers of readmissions vary from hospital to hospital, encompassing factors involving both unplanned as well as scheduled readmissions (such as surgery or other elective procedures).

The main emphasis of Medicare’s readmission reduction initiatives, including the QIO-led Care Transitions pilot programs in 14 communities across the U.S., has been on identifying the key components of improved discharge and aftercare that contribute to readmission reduction. QIO support for readmission reduction has been expanded under the Integrate Care for Populations and Communities (ICPC) initiative, which builds on the successes of the Care Transitions projects during the last three years. More information is available online at http://www.cfmc.org/integratingcare/Default.htm.

Due to a wide range of illnesses that can lead to readmission, it can be challenging for hospitals to determine where to focus their limited resources. Some factors to consider when evaluating the drivers of readmissions are:

  • Patients – Initial efforts should focus on the key diagnoses reported nationally under the Hospital Compare program. Many programs have centered their efforts on heart failure patients, with successful reductions following redesign of their discharge process and improvements in medication reconciliation. Other workable strategies include creating tighter links as they pertain to planning, fostering improvements in communication through office-based physician follow-up and employing the use of outreach strategies (telephonic or home visits) to promote self care and treatment adherence.
  • Admission Source – Transfers from skilled and long-term care facilities may have higher readmission rates than most other patients. It may be necessary to get together with staff from post-acute facilities and jointly review cases, looking for opportunities to improve communication or follow-up care.
  • Attending Physicians – Some physicians or specialties may have significantly higher rates of readmissions than others. It is prudent to identify and monitor these particular groups and consider collaborative strategies tailored to the types of patients and circumstances involved.

Related and Unrelated Readmissions

There are several definitions and viewpoints to consider when determining if a particular readmission was related in some way to an initial hospital stay. It is not difficult to look for readmissions with the same DRG or ICD-9 diagnosis codes, however this approach fails to identify readmissions that involve complications or worsening of an initial illness, medication intolerance, or other events that may be clinically linked to the initial stay. For example, prolonged use of a urinary catheter may be linked to a readmission for sepsis several days following treatment for a stroke. Signs of impending infection, such as a rising white blood cell count, pyuria, or altered mental status may be evident at the time of discharge, however the handoff from the hospital to an outpatient provider may be a barrier to management of a UTI, which could have prevented the need for readmission. Other barriers, such as medication adherence or transportation to the physician’s office, may be of a social nature, however education and care coordination resources can address those issues as well.

One important definition of a “related” readmission is contained in Medicare’s QIO Manual, Chapter 4, Section 4240: “Readmission Review.” When considering if a particular readmission is related to an initial hospital stay, QIOs are directed to perform an analysis of the medical records from both the initial and subsequent admission(s), specifically looking for evidence of incomplete care or premature discharge during the initial stay. Factors to be considered include patient stability at the time of discharge and the potential presence of a problem requiring subsequent care following the initial admission.


Another issue to be considered is whether a readmission was related to technical problems, such as scheduling of tests or procedures (i.e., “unavailability of surgical suite,” “the surgeon became ill,” etc.).

Under the QIO Manual, hospitals may be denied payment if the QIO determines that any of the following three circumstances existed (emphasis added):

The readmission was not medically necessary (i.e., outpatient care would have been appropriate);

The readmission resulted from a premature discharge from the same hospital ; or

The readmission was the result of circumvention of Medicare policy by the same hospital.

The QIO Manual focuses on a limited subset of readmissions: generally those cases in which the hospital is found to have contributed directly to the need for readmission or in which the hospital could have avoided readmission by providing outpatient or observation care.

Medicare has undertaken a shift to a much broader definition of related readmissions as required by the Patient Protection and Affordable Care Act (PPACA), Section 3025, “Hospital Readmissions Reduction Program.”  While the details of this new approach still are being worked out and will not take effect until FY 2013, the basic concept is that many readmissions likely will be deemed to be related to the initial stay unless there is clear evidence that the admissions are unrelated. An example of an unrelated admission would be a patient who is involved in a car accident with multiple trauma within 30 days of an admission for pneumonia. The PPACA requires CMS to develop a mechanism to adjust readmission rates such that an accurate identification of hospitals with excess readmissions can be made, leading to reduced DRG reimbursement for those target hospitals.

Utilization review committees should be aware of overall and DRG-specific readmission rates for their facilities, and conduct internal review projects to better understand the issues and identify opportunities to improve care transitions and support patient care following hospital stays. In an era of reduced lengths of stay and limited resources, paying attention to aftercare is more important than ever. Identifying related, potentially avoidable readmissions is the first step toward achieving this goal.

About the Author

Ralph Wuebker, MD, currently serves as Vice President of Executive Health Resources’ (EHR) ACE (Audit, Compliance and Education) Team. This group of physicians conducts audits and regular visits to EHR’s client hospitals to provide ongoing education on a variety of topics including Medicare and Medicaid compliance and regulations, medical necessity, Recovery Audit Contractors, utilization review, denials management and length of stay.

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