As healthcare organizations transition to value-based care, the responsibility for care management is shifting from payers to providers. In response, healthcare providers are seeking strategies to manage this responsibility while simultaneously improving the quality of patient care and lowering costs. For organizations who wish to meet the Institute of Healthcare Improvement's Triple Aim1 to improve population health, improve the patient experience and reduce cost per capita, targeting hospital readmission rates is a good start.

Learn more about how care management software solutions can help you manage high-risk conditions and complex cases to help prevent hospital readmissions and improve patient outcomes.
Care Management Team, Herrick posts

The High Costs of Readmissions

Readmission penalties from CMS are growing in size and severity; the maximum penalty for excess readmissions rises to 3 percent for fiscal year 2015. While some CFOs are willing to overlook negligible readmission penalties while their percentages are still small, there is little doubt that they will continue to increase. Kaiser Health News recently reported that 2,610 hospitals face penalties from Medicare due to high readmission rates. 2The overall cost? $428 million.

Preventing hospital readmissions means that healthcare organizations are lessening the chance they'll be penalized by Medicare, but that's only a small part of the financial picture. According to a recent study, 1 percent of patients make up 22.7 percent of hospital costs3. Patients who are the most vulnerable — those with multiple chronic conditions and those who face barriers to care — provide a major opportunity for healthcare systems to intervene.

Readmissions are also deleterious for both patient care and patient satisfaction. Along with enduring the ordeal of hospitalization all over again, patients who are readmitted with a higher acuity level take far longer to stabilize – and are not likely to view their patient experience favorably upon release.

When a patient has a positive hospitalization experience, the hospital builds a bond of loyalty not only with the patient, but with his or her loved ones, who hear all about the gold standard of care provided during the patient's stay. In order to retain patients and keep them within the network in the future, hospitals must pay attention to the patient experience. Research has shown an inverse relationship between readmission rates and quality scores.

How to Prevent Hospital Readmissions

The key reason to focus on reducing readmissions, however, is simply this: the majority of readmissions are preventable. Many models for preventing hospital readmissions emphasize four different steps organizations can take to decrease readmission rates:

  1. Clear communication during and after the discharge process. Psychologically, a patient just leaving the hospital is likely to be upset, confused and eager to return home. Discharge nurses should make sure that either the patient or the patient's family understands all instructions. Since many patients misplace the discharge information after they leave, hospitals should make a call to the patient's home the next day to help ensure that the patient is following all instructions.
  2. Ensuring correct medication management. Often, information on new medications and the warning signs of potential complications are delivered to a patient during the chaotic discharge process. The hospital should ensure that patients understand their medication lists, have the resources to fill any newly prescribed medications, and are actually taking their medications at the correct dosages.
  3. Follow-up appointment within the first 7 days. Before they leave the hospital, patients should be automatically scheduled for a follow-up appointment with their primary doctor or specialist within the first week after discharge. But the hospital's responsibility shouldn't stop there. The hospital should make sure that the patient has all the necessary resources to make this appointment – including finances to cover any co-pay and transportation to and from the appointment. If the patient fails to show up for the appointment, a hospital representative should contact the patient, address any barriers and reschedule the appointment.
  4. Patient education. Providers should ensure that patients truly understand how to successfully manage their conditions. Recently discharged patients should be aware of the warning signs and symptoms of a worsening condition – and what the appropriate next steps might be.

1"IHI Triple Aim Initiative." Institute for Healthcare Improvement, 2014. Accessed 11 December, 2014.
2Hagland, Mark. "Readmissions: The Numbers Are In, and They Are Dramatic for Hospitals." Healthcare Informactics. Vendome Healthcare Media, 4 October 2014. Accessed December 11, 2014.
3Evans, Melanie. "Reform Update: 1% of Patients Account for 22.7% of Spending, AHRQ Finds." Modern Healthcare. Crain Communications, Inc., 8 October 2014. Accessed December 11, 2014.

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About the author

Andy Herrick is Director of Product Strategy for McKesson Population Health Management solutions. With over 20 years of healthcare experience, Andy has also directed employee wellness programs and served as a faculty member for the School of Professional Studies at Fresno Pacific University. He holds a double B.A. Natural Science and Health Education from Fresno Pacific University and a Ph.D. in Wellness Education from Arizona State University. He is also a Certified Health Education Specialist.