Kaiser Health News recently published a list of 2,225 hospitals that will be penalized through the second year of the federal government’s Hospital Readmissions Reduction Program (HRRP). The list indicated the percentage that the hospitals’ base Medicare reimbursements will be reduced (0.38% on average) due to “excess” readmissions when the next round of penalties takes effect on October 1, 2013.

News of the release brought with it a renewed focus on the program and the efficacy of its approach, which is designed to counter perverse fee-for-service incentives in which hospitals are financially rewarded for readmitted patients. A chorus of concerns related to the methodology used to calculate “excess” readmissions has been raised by hospitals and researchers since the program was mandated by the Affordable Care Act.

Transitioning the health system toward value. Beyond methodological concerns, there is a question of the long-term policy role the HRRP should play as Medicare and other payers promote broader payment and delivery system reforms such as value-based purchasing, bundled payments, accountable care, and medical homes. These reforms may offer more positive and stronger incentives for improvement across the care continuum than the HRRP penalties. However, it is too soon to judge the effectiveness of these reforms, nor is it clear how quickly and widely they will be adopted.

In the short term, some view the HRRP as a first step in helping to transition fee-for-service medicine toward greater value. Perspectives from the field suggest that, despite shortcomings, the HHRP is bringing attention to systemic problems that manifest in avoidable readmissions.

Pointing the way forward. A new issue brief published by The Commonwealth Fund and the Institute for Healthcare Improvement summarizes a recent policy conversation among a group of experts in measurement and improvement that can help point the way forward toward a new policy. The report builds on the Medicare Payment Advisory Commission’s recent recommendations for refining the methodology used by the HRRP.

Participants in the conversation agreed that readmissions serve as an important, if imperfect, proxy for broader concerns about inadequate coordination across the continuum of health care and social services. The goal is to support patients and their caregivers so that patients successfully recover or cope with their condition and know where to turn for help after leaving the hospital. And, panelists agreed, clinicians also would benefit from a better appreciation of the heightened risk that a hospitalization imposes on patients’ particular circumstances.

To reach this goal, a new care paradigm in needed, supported by a broader approach to measurement that is relevant to patients, useful for improvement, and fair for accountability. Panelists discussed the need for:

  • A suite of measures that more broadly reflect patients’ experiences.
  • Balancing measures to help ensure health systems aren’t eliminating necessary hospital care.
  • Holistic measures to reflect how instrumental care coordination and community interventions are to outcomes.
  • Matching measures to the needs of users for improvement and accountability.

Moving beyond measurement. Making progress will also require cultivation of improvement skills among frontline teams, as well as a more nuanced approach to evaluating interventions to understand what works (or doesn’t work) in specific contexts.

We welcome your thoughts about this proposed framework, how it may be helpful to policy and practice, and how it might be operationalized.

NOTE: The views expressed represent the authors’ synthesis of the meeting discussion and of other information; the views do not necessarily reflect those of particular panelists, the Institute for Healthcare Improvement, or The Commonwealth Fund or its directors, officers, or staff.