Concerns Raised on Medicare Penalties on Safety-Net Hospitals

January 13, 2016 | Strategic Insights for Health System


​Concerns have been raised regarding whether, under the Hospital Readmissions Reduction Program, the Centers for Medicare and Medicaid Services (CMS) unfairly penalizes "safety net" healthcare organizations, which, as coverage in Health Affairs notes, "treat a disproportionate number of patients with low socioeconomic status." The article suggests that safety-net hospitals are located in areas where, due to a confluence of factors, the follow-up care that is required to prevent readmission is effectively unattainable. The authors note that the recommendation has been made to add "socioeconomic factors to the current risk-adjustment method for readmission measures and make changes to the penalty calculation to account for those factors." However, authors also explain, opponents of such actions believe that they would "mask disparities in healthcare and, in effect, sanction lower quality standards for patients with low socioeconomic status."

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