Medicare Eases Up On Readmissions Penalties For Hospitals Serving The Poor

At the direction of Congress, Medicare is easing up on its annual readmissions penalties for hundreds of hospitals serving large populations of low-income patients, records released last week show.

Since 2012, Medicare has punished hospitals for having too many patients end up back in their care within a month. The government estimates the hospital industry will lose $566 million in the latest round of penalties that will stretch over the next 12 months. The penalties are a signature part of the Affordable Care Act’s effort to encourage better care.

But starting next month, lawmakers mandated that Medicare take into account a long-standing complaint from safety-net hospitals. They have argued that their patients are more likely to suffer complications after leaving the hospital through no fault of the institutions, but rather because they cannot afford medications or don’t have regular doctors to monitor their recoveries. The Medicare sanctions have been especially painful for this class of hospitals, which often struggles to stay afloat because so many of their patients carry low-paying insurance or none at all.