Section 3025 of the Affordable Care Act added section 1886(q) to the Social Security Act establishing the Hospital Readmissions Reduction Program, which requires CMS (Centers for Medicare & Medicaid Services) to reduce payments to IPPS (Inpatient Prospective Payment System) hospitals with excess readmissions, effective for discharges beginning on October 1, 2012. The regulations that implement these provisions are in subpart I of 42 CFR part 412 of the same Section 3025 of the Affordable Care Act.
In the FY 2012 IPPS (Inpatient Prospective Payment System) final rule, CMS finalized the following policies with regard to the readmission measures under the Hospital Readmissions Reduction Program:
– Defined readmission as an admission to a subsection (d) hospital within 30 days of a discharge from the same or another subsection (d) hospital; Adopted readmission measures for the applicable conditions of acute myocardial infarction (AMI), heart failure (HF), and pneumonia (PN);
– Established a methodology to calculate the excess readmission ratio for each applicable condition, which is used, in part, to calculate the readmission payment adjustment. A hospital’s excess readmission ratio is a measure of a hospital’s readmission performance compared to the national average for the hospital’s set of patients with that applicable condition.
– Established a policy of using the risk adjustment methodology endorsed by the National Quality Forum (NQF) for the readmissions measures to calculate the excess readmission ratios, which includes the adjustment for factors that are clinically relevant including certain patient demographic characteristics, comorbidities, and patient frailty.
– Established an applicable period of three years of discharge data and the use of a minimum of 25 cases to calculate a hospital’s excess readmission ratio for each applicable condition.