More than 80 Georgia hospitals will receive lower reimbursements from Medicare because of their high rates of patient readmissions.

This story also appeared in Georgia Health News

Federal statistics compiled by Kaiser Health News show that just 12 eligible hospitals in the state will get no penalty due to readmissions.

Credit: Jake Shore/Stanley R. Boxer

The readmission penalties are required under the Affordable Care Act. The latest round of them pertains to hospital care from July 2016 to June 2019.

More than 50 hospitals in Georgia were not evaluated by the feds under the penalty program, either because they are critical-access hospitals or facilities that specialize in psychiatric patients, children, veterans, rehabilitation or long-term care. (Here’s a link to find out which Georgia hospitals are getting penalized.)

The cuts in payments come as Medicare continues to encourage hospitals to reduce the number of discharged patients who return for another stay within a month. The penalty will be deducted from each payment for a Medicare patient stay over the fiscal year that began Oct. 1.

The federal Centers for Medicare and Medicaid Services said recently that it may suspend the penalty program in the future if the extraordinary problems caused by the COVID-19 pandemic, including the spring 2020 moratorium on elective surgeries, make it too difficult to assess hospitals’ performance, Kaiser Health News reported.

Medicare will lower its payments to 84 Georgia hospitals, the federal data show. The federal program cuts as much as 3 percent for each patient, although the average is generally much lower.

Most of Georgia hospitals’ penalties are below 1 percent. Just one facility is getting the maximum reduction of 3 percent: Perry Hospital in Perry.

Nearly half the nation’s hospitals, many of which are still wrestling with the financial fallout of the unexpected coronavirus, will get lower payments from Medicare, Kaiser Health News reported. The number and severity of penalties are comparable to those of recent years, KHN said.

The penalties are based on the frequency of readmissions of Medicare patients who had originally been treated for heart failure, heart attack, pneumonia, chronic lung disease, hip and knee replacement or coronary artery bypass graft surgery. Readmissions that were scheduled to occur are not counted.

Credit: Justin Taylor/Stanley R. Boxer

Medicare counts the readmission of a patient to a hospital within 30 days even if that hospital is not the one that originally treated and released the patient. In such cases, the penalty is applied to the first hospital.

“It’s unfortunate that hospitals will face readmission penalties in fiscal year 2021,” Akin Demehin, director of policy at the American Hospital Association, told KHN. “Given the financial strain that hospitals are under, every dollar counts, and the impact of any penalty is significant.”

A hospital will be penalized if its readmission rate is higher than expected given the national trends in any one of those categories.

Michael Millenson, a health quality consultant who focuses on patient safety, told KHN that the use of such penalties is an imperfect but useful mechanism to push hospitals to improve care. The designers of the penalty system envisioned it as a way to neutralize the economic benefit that a hospital gets from readmitted patients under Medicare’s fee-for-service payment mode — i.e., getting paid for two stays instead of one.

“Every industry complains the penalties are too harsh,” he said. “if you’re going to tell me we don’t need any economic incentives to do the right thing because we’re always doing the right thing — that’s not true.”

This story is part of a news partnership with Georgia Health News.