House bill will change CMS readmission penalties to reflect socioeconomic factors

The Helping Hospitals Improve Patient Care Act was introduced to the House of Representatives last Wednesday, with the goal of reforming Medicare payments to improve care quality. One of the bill’s proposed changes addresses a longstanding argument in the healthcare industry by allowing socioeconomic factors to be considered for the Hospital Readmissions Reduction Program.

"The Helping Hospitals Improve Patient Care Act takes responsible steps to strengthen Medicare and give hospitals and healthcare providers the certainty they need to best serve their patients," said bill co- sponsor and House Ways and Means Health Subcommittee Chairman Pat Tiberi (R-Ohio), in a statement.

The American Hospital Association (AHA) has been a proponent of including socioeconomic factors into CMS reimbursement policies for years. The organization says that many of the factors that drive readmissions, such as poverty and lack of access to services, are beyond hospitals’ control.   While it is still reviewing the language in the bill, the AHA announced its support and approval of the bill and its authors.

“America’s hospitals appreciate the leadership of Chairman [Kevin] Brady and Representatives Tiberi and [Jim] McDermott on behalf of the hospital community,” the AHA wrote.  “They clearly grasped the unintended consequences of last year’s Bipartisan Budget Act that severely impacted hospital outpatient facilities under development and jeopardized access to patient care. We agree with their policy that the readmissions program needs to be adjusted to account for socioeconomic status.”

If passed, the bill would allow CMS to determine acceptable readmission rates by comparing facilities with similar patient populations. The bill’s other provisions include closing a payment loophole for “mid-build” facilities and providing financial relief to cancer centers.