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Medicare changing nursing home incentives to deter poor care

Written by Diane Archer

Kaiser Health News reports on a ghastly phenomenon that appears all too common for people with Medicare in some nursing homes. To increase their revenues, nursing homes create conditions that lead residents to be rehospitalized. Medicare is now changing its nursing home payment policies to try to align nursing home financial incentives to deter poor care.

KHN describes one case in which a nursing home literally dropped a resident, causing a hip fracture, and creating a reason to move the resident to a nursing home. That led to a lawsuit from the patient’s family and a settlement of $1.4 million by Richmond Pines Healthcare and Rehabilitation Center in North Carolina.

All too frequently patients are discharged from hospital to a nursing home and return to hospital in less than a month. One in five Medicare patients are back in hospital after discharge in less than 30 days. And, in many cases, the rehospitalization was preventable–dehydration, medication errors, infections. Keep in mind that Medicare Advantage plans tend to steer people to poorer quality nursing homes than traditional Medicare.

Unfortunately, Medicare payment policies give nursing homes a financial incentive to transfer patients back to hospital. While it may be good for the nursing homes’ bottom line, taxpayers and patients pay more in these cases.

Medicare already financially penalizes hospitals with high readmission rates as a way to rein in costs and protect patients. Its policy has reduced the rate of readmissions more than 10 percent, from 12.4 percent to 10.8 percent over five years.

Medicare is now about to penalize nursing homes for high transfer rates back to hospitals. Today nursing homes with patients who have both Medicare and Medicaid benefit when a patient is rehospitalized because it often triggers a fresh Medicare nursing home care payment for 100 days, which is higher than the Medicaid rate.

Take care when someone you love is being transferred from hospital to nursing home. Often changes in medication regimens and other treatment protocols are misunderstood or not properly communicated. Moreover, choose hospitals and nursing homes carefully.  Some hospitals and nursing homes are better than others, and it is worth understanding which are the good ones. Medicare’s star ratings do not tell you enough. But, for sure, check out a hospital’s readmission rates and a nursing home’s rehospitalization rates, which can vary significantly.

Here’s more from Just Care:


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