Every year, Medicare penalizes hospitals that underperform. This year, it penalized 764 hospitals because they had high rates of patient infections and complications that could have been avoided. Jordan Rau of Kaiser Health News reports that, of those it penalized, it gives five star-ratings to 38, signaling that they are among the best in the nation.
Medicare penalized an additional 138 hospitals with four-star ratings. Do not rely on these star-ratings exclusively when choosing a hospital!!!!
Medicare penalizes hospitals financially with a one percent reduction in payments if Medicare patients experienced high readmission rates, death rates, infection rates, and/or said they had a poor experience. The goal is to get hospitals to minimize bedsores, hip fractures, infections and blood clots.
Many hospitals that you might think of as first-rate were penalized this year, including the Cleveland Clinic in Ohio, the Mayo Clinic in Red Wing, Minnesota and Phoenix, Arizona. Each of these hospitals had Medicare five-star ratings.
It’s not at all clear that the penalties are changing hospital practices, based on recent analyses. It’s also not clear that all hospitals are reporting accurate information that would result in assessing penalties against them. The penalties are a big financial hit for hospitals.
The penalties might save Medicare money, but they seem poorly designed. They must be charged to the 25 percent of hospitals with the greatest safety issues, even if these hospitals perform about the same as other hospitals or they have improved significantly from the prior year.
Medicare cannot impose a penalty on critical care access hospitals. They tend to be rural hospitals. They can also be rehab, psychiatric and long-term care hospitals. Hospitals in Maryland are also excluded because they are paid under an all-payer system.
Of note, Medicare does not penalize Medicare Advantage plans that perform poorly in the same way. It is not required to reduce payments to the worst performing MA plans. In fact, it doesn’t even recoup tens of billions of dollars in overpayments to them, driving up costs for everyone with Medicare and eroding the Medicare Trust Fund.
Here’s more from Just Care:
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