The recently signed 21st Century Cures Act requires Medicare to account for patient socioeconomic backgrounds when it calculates reductions in its payments to hospitals under the Hospital Readmissions Reduction Program (HRRP). This, provision was included in the Cures Act despite an active public debate about whether patients’ socioeconomic status should be included in the readmission measures used to determine penalties under the HRRP. Using CMS methodology, the authors compared risk-standardized readmission rates (RSRRs) for hospitals caring for high and low proportions of patients of low socioeconomic status (as defined by their Medicaid status or neighborhood income). The authors then calculated risk-standardized readmission rates (RSRRs) after additionally adjusting for patients’ socioeconomic status.
The results demonstrate that hospitals caring for large proportions of patients of low socioeconomic status have readmission rates similar to those of all other hospitals. Moreover, readmission rates calculated with and without adjustment for patients’ socioeconomic status are highly correlated. Readmission rates of hospitals caring for patients of low socioeconomic status changed by approximately 0.1 percent with adjustments for patients’ socioeconomic status, and only 3 to 4 percent fewer such hospitals reached the threshold for payment penalty in Medicare’s HRRP. Overall, this study shows that HRRP adjustments for socioeconomic status as required by the Cures Act will not change hospital readmission results in a meaningful way overall and might only affect 3 to 4 percent of individual hospitals.