Almost one fifth (19.6%) of the 11,855,702 Medicare beneficiaries who had been discharged from a hospital were rehospitalized within 30 days, and 34.0% were rehospitalized within 90 days; 67.1% of patients who had been discharged with medical conditions and 51.5% of those who had been discharged after surgical procedures were rehospitalized or died within the first year after discharge. In the case of 50.2% of the patients who were rehospitalized within 30 days after a medical discharge to the community, there was no bill for a visit to a physician's office between the time of discharge and rehospitalization.
It was the first paper to look at all cause Medicare readmission rates since this paper which looked at readmissions in the pre-DRG era. Its findings:
In order to examine the proportion of Medicare expenditures attributable to repeated admissions to the hospital, we assessed the frequency with which 270,266 randomly selected Medicare beneficiaries were readmitted after hospital discharge between 1974 and 1977. Twenty-two per cent of Medicare hospitalizations were followed by a readmission within 60 days of discharge.
Those authors presciently warned:
Even a small decrease in the readmission rate could result in substantial savings for the Medicare program. The recently enacted prospective-payment legislation, however, creates economic incentives that could increase readmission rates.
Although direct comparisons of the two studies are difficult it does indeed appear that the problem has gotten worse in the DRG era, as the 30 day readmission rate in the current study almost equals the 60 day rate from the pre-DRG data. That should surprise no one. I was early in my career during the enactment of Medicare’s prospective payment system. The changes in the way patients were cared for and the sudden administrative pressures to limit hospitalization of Medicare beneficiaries were dramatic. Medicare no longer paid for the care hospitals delivered. Hospitals lost money on Medicare admissions. This resulted in more selective admission criteria for hospitals such that only more severely ill patients were hospitalized. In addition, widespread anecdotal reports of Medicare patients being discharged “quicker and sicker” were confirmed in research reports such as this one:
Instability at discharge (important clinical problems usually first occurring prior to discharge) predicted the likelihood of postdischarge deaths. At 90 days postdischarge, 16% of patients discharged unstable were dead vs 10% of patients discharged stable. After the PPS introduction, instability increased primarily among patients discharged home. Prior to the PPS, 10% of patients discharged home were unstable; after the PPS was implemented, 15% were discharged unstable, a 43% relative change.
Although increased mortality has not, as far as I am aware, been attributed to the enactment of DRG’s, probably due to progressive improvements in the overall quality of care over time, it is highly likely that the prospective payment system has resulted in increased readmission rates.
This is why I disagree with Bob on one point. He likes DRG’s. I don’t. I believe the PPS was an ill-conceived and reactionary move against the largesse and massive inefficiencies of the first 20 years of Medicare’s existence as I pointed out here.
At any rate, we’re stuck now with a perverse system of negative cost incentives that we must make the best of. We can all agree that we have an unacceptable readmission rate and hospitals are doing a lousy job of transitions care. What to do about it? A proposal which is gaining momentum (which will accelerate as a result of the new NEJM paper) is to bundle payment for episodes of care over the 30 days following hospitalization. A part of me rebels at this strategy; it is nothing more than an extension of the perverse cost incentives that got us in this fix in the first place. On the other hand we have to live with these incentives. We can’t dismantle the PPS in 2009. And we have to do something about the horrible transitions process. We know from experience that performance measures won’t cut it. They’ll result in cosmetic improvements only. It may well be that our only recourse now is to make it all about money.