title: Redesigning the Medicare inpatient PPS to reduce payments to hospitals with high readmission rates.
abstract: A redesign of the Medicare inpatient prospective payment system (IPPS) that reduces payments to hospitals that have high-risk adjusted readmission rates is proposed. The redesigned IPPS uses a readmission performance standard from best practice hospitals to determine the risk-adjusted number of excess readmissions in a hospital and determines the payment reduction for a hospital based on its excess number of readmissions. Extrapolating from Florida Medicare 2004-2005 discharge data, the redesigned IPPS is estimated to reduce overall annual Medicare inpatient expenditures nationally by $1.25, 1.92, and 2.58 billion for readmission windows of 7, 15, and 30 days, respectively.
authors.affiliation: 3M Health Information Systems, Wallingford, CT 06492, USA. rfaverill@mmm.com
authors.forename: Richard F
authors.initials: RF
authors.lastname: Averill
authors.forename: Elizabeth C
authors.initials: EC
authors.lastname: McCullough
authors.forename: John S
authors.initials: JS
authors.lastname: Hughes
authors.forename: Norbert I
authors.initials: NI
authors.lastname: Goldfield
authors.forename: James C
authors.initials: JC
authors.lastname: Vertrees
authors.forename: Richard L
authors.initials: RL
authors.lastname: Fuller
mesh_terms: D006801:Humans; D006278:Medicare / Q000191:economics*; D009936:Organizational Innovation; D010359:Patient Readmission / Q000191:economics / Q000592:standards*; D011445:Prospective Payment System / Q000458:organization & administration*; D014481:United States