Medicare will begin penalizing hospitals in the fiscal year starting Oct. 1 because their readmission rates for patients with heart failure, heart attack or pneumonia were too high. The maximum penalty is 1 percent. Of 16 hospitals in D.C. and Northern Virginia, only three were not penalized. If a hospital has a penalty of 0.8 percent, Medicare would reduce each claim for base reimbursement by that amount. Read related article.