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Hospitals Fined $529 Million for Serving Medicare Patients Twice in 30 Days


  • Published: 2014-08-08 (Revised/Updated 2018-01-25) : *Press Release: Globe1234 : Contact: Globe1234.com
  • Synopsis: Medicare will fine hospitals for serving Medicare patients twice in 30 days. The fines reduce hospital care for seniors and save Medicare money.

The largest fines are $4 million each for Beaumont Hospital in Royal Oak, MI; Thomas Jefferson University Hospital in Philadelphia; Northwestern Memorial Hospital in Chicago; and Florida Hospital in Orlando.

Total fines by state range from $51 million in New York, $40 million in Illinois, $38 million in Florida, and $33 million in California, to $75,000 in Vermont and zero in Maryland. Medicare's headquarters are in Maryland, and the state promised to cut readmissions by 2019, so Medicare exempts it. All hospitals and states are listed on Globe1234.com.

Hospitals pay fines when patients in five categories stay in a hospital, and then have an unplanned hospital stay within 30 days. It does not matter if the stays are related or not, at the same or different hospitals. Fines apply when hospitals have more readmissions than the national average, adjusted for patient mix. Eighty-three percent of hospitals where Medicare calculated the data will pay fines, because they had more readmissions than average in at least one category.

Hospitals earn fines when patients have Medicare Part B for doctor bills and are in one of these five categories:

These conditions often occur in fragile seniors who need more frequent care than average.

Medicare is trying to reduce the hospital stays it covers for these seniors to save money. Patients can avoid the limits on care by dropping Part B if they have access to other insurance, going to Maryland hospitals, or waiting until the 31st day to go back to a hospital if medically appropriate.

Doctors Joynt and Jha of Harvard in the Journal of the American Medical Association Jan 23, 2013 found that fines fall on hospitals which serve the neediest patients, "large hospitals, teaching hospitals, and SNHs [safety net hospitals] are more likely to receive payment cuts" from readmission penalties, "likely related to both case mix (medical complexity) and socioeconomic mix of the patient population."

The Affordable Care Act has formulas for the fines.

Medicare chooses the exemptions and chose to add hip and knee replacements and COPD this year. Medicare also publishes each hospital's total readmission rate for all Medicare patients, to deter all readmissions for 30 days after a hospital stay.

Medicare posted the rules on its website August 4 and will publish them in the Federal Register August 22. Fines have accrued in the past three years, and payment will start October 1. Estimates for each hospital were prepared and posted by a private site, Globe1234.com.

Globe1234.com is a watchdog site on issues such as readmissions, accountable care and diet guidelines. It is edited by Paul Burke, a retired federal researcher. A graduate of Brown University, he has managed and analyzed data for HUD, Congress' Office of Technology Assessment, and the UN Development Program.

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