For a large Hospital Group hoping to reduce readmission rates by 3% annually, predictive analytics is helping doctors pinpoint patients with high readmission risk. Hospital staff then administer additional medical care to these patients and thereby reduce readmission rates.
The Hospital Group generates an individualized prediction of a patient’s readmission rate at the time of diagnosis. Using the derived predictions from the analysis, the Hospital Group reaps the following annual savings:
• Utilizes resources more efficiently by providing extra care to high-risk patients.
Recent changes in federal legislation have made hospitals restructure the way they manage patients to save money and avoid government penalties. Section 3025 of the Affordable Care Act added section 1886(q) to the Social Security Act, which took effect October 1, 2012. It established the Hospital Readmissions Reduction Program, which requires the Centers for Medicare & Medicaid Services (CMS)—a federal agency whose mission is to ensure effective healthcare coverage and to promote quality care for Americans—to reduce payments to hospitals with excess readmissions.
Consequently, hospitals have been seeking ways to reduce readmission rates across the board. Doing so would not only reduce unnecessary costs, it would help hospitals avoid CMS-levied payment penalties.
The Hospital Readmissions Program Accuracy and Accountability Act requires CMS to account for patient socioeconomic status when calculating risk-adjusted readmission penalties. Holding all other factors constant, socioeconomic conditions—such as poverty, low literacy, limited English proficiency, minimal social support, poor living conditions, and limited community resources—likely have direct and significant impacts on avoidable hospital readmissions. Adjusting for these factors would improve accountability and quality of care.
Per capita healthcare costs in the US are the highest in the world and have trended upward for decades. Reducing the number of unnecessary readmissions by even a few percent could create huge savings.
A readmission is defined as a hospitalization that occurs approximately 30 days after a previous hospital stay. Readmissions are often the result of a patient’s initial problem not being resolved. They can also be caused by a patient’s mismanagement of the original condition, misunderstanding how to manage the condition, or lack of access to additional medical services or medications.