For the county’s largest hospital, the cuts could amount to $300,000. But efforts are underway among area health care providers to lower those re-admission rates and negate the penalties.
According to records the Centers for Medicare and Medicaid released earlier this week, Regional Medical Center and Stringfellow Memorial Hospital are two of 2,225 U.S. hospitals that will receive less in Medicare reimbursements starting Oct. 1 for the 2014 fiscal year for having too many patient re-admissions. The Medicare penalty program is part of an effort by the federal government to reduce health care costs through improved efficiency. Some health care industry experts say the program, which began in 2012, will benefit hospitals and patients through better care and lower costs. Meanwhile, RMC administrators have worked with area nursing homes and long-term care facilities the past year to reduce re-admissions and don't expect a penalty next year.
The Medicare reimbursement penalty program, which is part of the Affordable Care Act federal health care reform law, will impose a total of $227 million in penalties on hospitals in the 2014 fiscal year. How much a hospital is penalized is based on a variety of factors which when combined show whether the hospital is re-admitting too many patients.
CMS records show RMC will face a 0.4 percent cut in Medicare reimbursements in the 2014 fiscal year, amounting to about $300,000. The penalty is based on RMC's re-admission rate for this year. RMC received a 0.2 percent reduction in Medicare reimbursements at the start of the 2013 fiscal year based on its 2012 re-admission rates.
Medicare is a federal program that provides insurance mainly for Americans who are at least 65 years old.
Stringfellow faces a 0.15 percent reduction in Medicare reimbursements in 2014, an increase from the 0.07 percent reduction it received in 2013. Attempts to reach Stringfellow Thursday and Friday for comment were unsuccessful.
RMC Jacksonville, which RMC purchased in December, received no penalty for the 2014 fiscal year after receiving a 0.4 percent decrease in reimbursements for this year.
Cristina Boccuti, senior associate with the Kaiser Family Foundation, said the program is designed to benefit patients and save Medicare money. Kaiser is a nonprofit, nonpartisan group that focuses on health care issues facing the country.
"Patients will gain from not being re-admitted ... and Medicare will not be spending for a second hospitalization," Boccuti said. "Hospital stays are very costly."
Dr. Mickey Trimm, associate professor of health care management at the University of Alabama at Birmingham, said that overall, the program should help hospitals improve care for patients.
"I think it's a good, interim step because it’s forcing hospitals to take a look at continuity of care," Trimm said. "Hospitals do not always have continuity with health and rehab agencies."
Trimm noted that most hospitals have received some sort of penalty through the program and many of the larger ones are now starting to do something about it, since the maximum possible penalty will increase to a 2 percent reduction in Medicare reimbursements in 2014.
"That's a large amount ... by 2014, there will be some pretty significant efforts to prevent re-admissions," Trimm said.
David McCormack, CEO of RMC, said that when the program was announced two years ago, his director of case management and social services, Mary Ann Crow, organized an initiative among RMC, area home care professionals and nursing homes to lower re-admission rates.
"These patients being re-admitted are all chronically ill people," McCormack said. "What we want to do is keep them out and keep them healthy."
McCormack said that last year, RMC had an approximately 22 percent re-admission rate.
"Last quarter it was down to 6 percent," McCormack said. "The good thing is we won't be penalized next time."
CMS statistics show that re-admission rates in the U.S. reached a low of 18 percent in October 2012 and averaged 18.4 percent for the entire year after averaging 19 percent for the previous five years. CMS estimates there were 70,000 fewer re-admissions nationwide in 2012 compared to the five-year average rate.
Becky Helton, administrator for NHC Health Care in Anniston, which provides long-term care for seniors, said her organization has worked with RMC the past year to cut hospital re-admission rates. Through its efforts, NHC has so far this year reduced its hospital re-admission rates by 50 percent compared to last year, Helton said.
"It'll be a long process, but we are making a big leap here at NHC in care," Helton said.
To lower re-admissions, staff at NHC increased education of patients and their families in the proper use of medication and of the warning signs that will arise to warrant a hospital trip, Helton said.
"Along with that we have a tremendous amount of physician involvement, with a physician available on site three days a week and a nurse practitioner here five days a week," Helton said. "So we can treat conditions quicker and pick up on problems quicker."
Rosemary Blackmon, vice president of the Alabama Hospital Association, said the penalty program is helping improve health care in the area by strengthening coordination between hospitals and other health care providers. Still, some Alabama hospitals are concerned the penalty is being applied unfairly, Blackmon said.
"Hospitals can give the best discharge information they can, provide more information on medication use, but they can't be in charge of compliance when patients leave," Blackmon said. "It almost puts hospitals in a position of being case managers for patients not just in the hospital but once they get out, and I don't know if that is necessarily fair."
Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star.