Wachter and Jha trudge through the CMS readmissions Slough of Despond

When two of my favorite observers of health care policy talk, I pay attention.  So I was captured by Bob Wachter's comment on Twitter:

.@ashishkjha blog on readmissns is mastrpiece: rigorous anlysis, wise interpretatn, willing 2 change mind w/ new data

Recall that Ashish was pretty hard on the readmissions penalty in the past, citing the disproportionate impact on safety net hospitals.  In March 2014, I summarized an earlier piece prepared by him and Karen Joynt here:

Over two years ago, I summarized a research paper from Karen E. Joynt and Ashish K. Jha at Brigham and Women's Hospital that suggested that a one-size-fits-all readmission rate penalty policy would have the unintended consequence of harming safety net hospitals.  They said: 

"Conclusions—Given that many poor-performing hospitals also have fewer resources, they may suffer disproportionately from financial penalties for high readmission rates.  As we seek to improve care for patients with heart failure, we should ensure that penalties for poor performance do not worsen disparities in quality of care.  (Circ Cardiovasc Qual Outcomes. 2011;4:53-59.)"

So, I was intrigued by Bob's summary, limited by Twitter to 140 characters. The click-through got me to Ashish's article, here. Here's the lede:

I was initially quite unenthusiastic about the HRRP (primarily feeling like we had bigger fish to fry), but over time, have come to appreciate that as a utilization measure, it has value. Anecdotally, HRRP has gotten some hospitals to think more creatively, focusing greater attention on the discharge process and ensuring that as patients transition out of the hospital, key elements of their care are managed effectively. These institutions are thinking more carefully about what happens to their patients after they leave the hospital. That is undoubtedly a good thing. Of course, there are countervailing anecdotes as well – about pressure to avoid admitting a patient who comes to the ER within 30 days of being discharged, or admitting them to “observation” status, which does not count as a readmission. All in all, a few years into the program, the evidence seems to be that the program is working – readmissions in the Medicare fee-for-service program are down about 1.1 percentage points nationally. To the extent that the drop comes from better care, we should be pleased.

OK.  But on a key point, Ashish has not changed his tune at all:

HRRP penalties began 3 years ago by focusing on three medical conditions: acute myocardial infarction, congestive heart failure, and pneumonia. ... [W]e know that when it comes to readmissions after medical discharges such as these, major contributors are the severity of the underlying illness and the socioeconomic status of the patient. The readmissions measure tries to adjust for severity, but the risk-adjustment for this measure is not very good. And let’s not even talk about SES.

The evidence that SES [socieoeconiomic status] matters for readmissions is overwhelming – and CMS has somehow become convinced that if a wayward hospital discriminates by providing lousy care to poor people, SES adjustment would somehow give them a pass. It wouldn’t. As I’ve written before, SES adjustment, if done right, won’t give hospitals credit for providing particularly bad care to poor folks. Instead, it’ll just ensure that we don’t penalize a hospital simply because they care for more poor patients.

On surgery, he reaches a different conclusion:

Surgical readmissions appear to be different. A few papers now have shown, quite convincingly, that the primary driver of surgical readmissions is complications. Hospitals that do a better job with the surgery and the post-operative care have fewer complications and therefore, fewer readmissions. Clinically, this makes sense. Therefore, surgical readmissions are a pretty reasonable proxy for surgical quality.

He looks at the data, and summarizes the program's experience over three years:

Your interpretation of these results may differ from mine, but here’s my take. Most hospitals got penalties in 2015 and a majority have been penalized all three years. Who is getting penalized seems to be shifting – away from a program that primarily targets teaching and safety-net hospitals towards one where the penalties are more broadly distributed, although the gap between safety-net and other hospitals remains sizeable.  It is possible that this reflects teaching hospitals and safety-net hospitals improving more rapidly than others, but I suspect that the surgical readmissions, which benefit high quality (i.e. low mortality) hospitals are balancing out the medical readmissions, which, at least for some conditions such as heart failure, tends to favor lower quality (higher mortality) hospitals. Safety-net hospitals are still getting bigger penalties, presumably because they care for more poor patients (who are more likely to come back to the hospital) but the gap has narrowed. This is good news. If we can move forward on actually adjusting the readmissions penalty for SES (I like the way MedPAC has suggested) and continue to make headway on improving risk-adjustment for medical readmissions, we can then evaluate and penalize hospitals on how well they care for their patients. And that would be a very good thing indeed.

As Bob suggests, and as comes as no surprise to those of us who know Ashish, he looks at the data and gives his best view of what it all means.  The message for me, though, is a bit less pleasing.  It is clear that this whole program had an insufficient analytical and clinical basis at the start, might be improving a bit, but is a lot of time and effort spent on the wrong things. As things at CMS wend through a statistical Slough of Despond on this issue, the agency knowingly contributes to billions in waste in the system by employing rate structures and regulatory rulings that enable high cost technologies to propagate throughout the land, often in ways that harm the very constituency they are charged with protecting.