Hospitals in D.C., Va. to lose millions from Medicare

Hospitals in the District and Northern Virginia will lose millions of dollars in Medicare funding over the next year because too many of their patients were re­admitted to a hospital within weeks of being released, according to Medicare data and interviews with hospital officials.

Beginning Monday, the hospitals will receive lower reimbursements on Medicare claims filed with the government for each admitted patient. Over the year, the total amount of those reductions will vary from $1.2 million for MedStar Washington Hospital Center in Northwest Washington, the region’s largest private hospital, to about $12,000 for Reston Hospital Center in Virginia. Of 16 hospitals in the District and Northern Virginia, all but three will get paid less.

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Medicare will begin penalizing hospitals if readmission rates for patients with heart failure, heart attack or pneumonia are too high.

The penalties do not apply to Maryland hospitals because the state has a special payment arrangement with Medicare, the federal health program for the elderly and disabled.

Although the penalties represent a tiny fraction of the institutions’ revenue, they have caught the attention of hospital executives, who already are grappling with tight budgets and taking steps to avoid even steeper penalties next year.

The readmission penalty, authorized by the 2010 health-care law, is one of the first examples of the incentives Medicare, the single largest payer of hospital services, is using to try to lower costs and improve care.

Some of the hardest-hit facilities are inner-city hospitals that tend to treat sicker, poorer patients. These patients sometimes end up being readmitted because they have a harder time getting medication and follow-up doctors’ appointments, often because they lack transportation, hospital officials said.

“Not only do we have the very sick patients, they also have very significant social needs,” said
Kamaljit Sethi, who heads quality and safety at Providence Hospital in Northeast, where officials estimate they will lose about $320,000 in the coming year.

Cash-strapped Howard University in Northwest was the only area hospital hit by the maximum penalty of 1 percent of its Medicare payments. Howard will receive about $400,000 less in payments in the coming year, according to an analysis of Medicare data for fiscal 2011.

The hospital said that the penalty wouldn’t affect its services but that it planned to “give greater assistance to this population.” Officials declined to comment or provide details.

Besides Howard and Providence, the other District facilities with the highest penalty rates are MedStar Washington Hospital Center and George Washington University Hospital.

Hospitals generally are paid for each admission. All too often, experts say, the problems that send patients back to the hospital might have been avoided if there had been a better handoff from the hospital to the people responsible for the next phase in a patient’s recovery, whether it’s the patient and his or her family, a home health agency, a nursing home or a hospice.

Many patients aren’t in the best position to understand what hospital staff tell them at discharge. “They’re sleep-deprived, on pain medicine, maybe worried about the dog or whether someone is going to steal the Social Security check in their mailbox,” said Eric Coleman, a national expert on readmissions at the University of Colorado School of Medicine.