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Hospital Readmissions Reduction Program:
Keys to Success
̶̶ Bobbi Brown

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Reducing Readmissions
Medicare penalizes hospitals when they
don’t meet readmission benchmarks.
Although hospitals reduced avoidable
readmissions for Medicare patients by
about 100,000 in 2015, and by a total of
565,000 since 2010, there’s still much
room for improvement.
The federal government has estimated
the annual cost of Medicare readmissions
to be $26 billion per year with $17
billion of that considered avoidable.

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Reducing Readmissions
CMS first addressed this financial problem
back in 2009 by publicly reporting hospital
readmission rates on the Hospital
Compare website.
CMS claimed the public reporting of
readmission metrics would increase the
transparency of hospital care, help
consumers choose a care venue, and
provide a benchmark for hospitals in their
quality improvement efforts.

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Reducing Readmissions
In 2012, CMS launched the Hospital
Readmissions Reduction Program (HRRP),
which began to penalize hospitals with high
rates of readmissions for acute myocardial
infarction, heart failure, and pneumonia.
In 2013, the Medicare payment reduction
(penalty) was one percent of the base rate,
increasing to two percent in 2014, and capped
at three percent going forward from 2015.
Also in 2015, chronic obstructive pulmonary
disease (COPD) and total hip and knee
arthroscopy were added to the program.

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Hospital Readmissions Reduction Program Results
CMS Estimated readmission penalties
under the HRRP program as follows:
2013 – 8.0% of hospitals paid a 1% penalty
2014 – 0.6% of hospitals paid a 2% penalty
2015 – 1.2% of hospitals paid a 3% penalty
The average penalty among those
hospitals penalized rose from 0.42 percent
to 0.63 percent over those three years.
This amounted to between $125,000 and
$164,000 per hospital.
2013 2014 2015
READMISSION PENALTIES
(millions)
$290
$227
$428

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Hospital Readmissions Reduction Program Results
The $164,000 is a drop in a bucket
compared to overall Medicare expendi-
tures and the massive budgets of many
of the health systems affected.
Absorbing these losses may not be a
challenge for some hospitals.
Even if hospitals can absorb the
financial hit, they still need to track
reporting metrics—and doing so will
become increasingly complex.

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Keeping up with Tracking and Reporting Demands
CMS places its share of tracking and
reporting demands on the nation’s
hospitals, but the burden increases with
pressures from other entities, as well.
State and federal regulations, licensing,
private payer initiatives, and accredit-
ation bodies all require reports.
Standards of transparency demand
additional reported metrics that
consumers use to make care decisions.

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Keeping up with Tracking and Reporting Demands
Solution, Part 1: The Enterprise Data Warehouse
So what can a hospital do to keep up with these rising demands?
The answer is straightforward: adopt a
healthcare enterprise data warehouse
(EDW) to meet the many reporting
demands.
Here are a few examples of how an
EDW helps solve the reporting burden:

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Keeping up with Tracking and Reporting Demands
Solution, Part 1: The Enterprise Data Warehouse
Users can access integrated views of financial, clinical, and
operational data from throughout the enterprise.
Data collection and the analysis process become automated. Manual
data collection and tracking simply won’t work in the future. These
manual processes consume time and resources and often result in
inaccurate or missing information.
Users can collect data from across the enterprise to integrate clinical,
financial, and operational data from inpatient and outpatient settings.
Reports are generated automatically, ensuring that the right data gets
to the right audience at the right time.
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Keeping up with Tracking and Reporting Demands
Solution, Part 1: The Enterprise Data Warehouse
The benefits of an EDW don’t end with reporting, though.
An EDW delivers the business intelligence tools a hospital needs to
drive real cost and quality improvement initiatives. In specific, an EDW
enables health systems to:
Establish a baseline for all quality measures
Perform analytics to pinpoint opportunities for improving quality
Track the success of improvement interventions
Measure and sustain results over the long term
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Keeping up with Tracking and Reporting Demands
Solution, Part 2: Analytics Applications
Once an EDW is in place, the organization has
a foundation to adopt analytics applications.
Analytics is a powerful tool that enables non-
technical users to make sense of the data and
discover the best areas to make changes.
There are different types of improvement
applications that provide an array of solutions.
• Clinical analytics
• Financial analytics
• Operations and performance analytics

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Keeping up with Tracking and Reporting Demands
Solution, Part 2: Analytics Applications
Effective improvement applications apply to
different categories, including care management
and patient relationships, population health and
accountable care, and research informatics.
Effective analytics solutions share one
important trait: non-technical users gain an
easy and intuitive way to ask complex
questions of the data stored within the EDW.
Nobody needs to be a programmer or wait
weeks or months for a custom-built report.

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Reducing Heart Failure Readmissions
From improved reports to driving
improvements, the benefits of an EDW
and analytics applications are many.
In fact, one large health system
reduced heart failure readmissions by
using an EDW as a foundation for its
advanced analytics applications.
First, the system implemented an EDW
to quickly pool financial, operational,
patient satisfaction, and clinical data
from the inpatient EHR and other
major information systems.

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Reducing Heart Failure Readmissions
With the technology infrastructure in place, the
team in charge of the initiative crafted specific,
measurable objectives by October 2014:
30 percent reduction in the 30-day
all-cause readmission rate
15 percent reduction in the 90-day
all-cause readmission rate for patients
with heart failure
Sustain the reductions through 2016
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Reducing Heart Failure Readmissions
Next, the team outlined specific interventions based on best practices
that would move them toward their goal. Interventions included:
Medication reconciliation – Within 48 hours of discharge, a
physician reviews a list of the patient’s medications with explicit
instructions to the patient about how to properly take them.
Post-discharge appointments – Before being discharged, nurses
schedule patients for follow-up care. When possible, patients at
high risk for readmission are scheduled to be seen within seven
days of discharge.
Post-discharge phone calls – Within a specified timeframe following
discharge, a member from the care team calls patients
to assess their condition and answer any questions.
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Reducing Heart Failure Readmissions
An integrated dashboard was created in
the healthcare EDW platform for each of
the three interventions.
This enabled clinicians and adminis-
trators to track where the interventions
were being applied.
They could also track the impact the
changes were having on readmissions.
Even more, the EDW and analytics
applications allowed the team to assess
the impact of the interventions on costs
and patient satisfaction.

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Reducing Heart Failure Readmissions
The results have been impressive. Just six months after
implementing the EDW, the health system achieved:
A 21 percent seasonally adjusted reduction
in 30-day heart failure readmissions
A 14 percent seasonally adjusted reduction
in 90-day heart failure readmissions
A 63 percent increase in post-discharge
medication reconciliation
It is well on its way to meeting—and even
exceeding—its objective.
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The Right Technology Can Reduce Readmissions
Reducing readmissions contributes significantly
to lowering the overall costs of healthcare in
U.S. hospitals, but tracking the metrics and
reporting the results can be onerous.
The process is greatly facilitated by analytics
applications supported by an enterprise data
warehouse to guide improvement projects.
These are the keys to developing best
practices that will ultimately help hospitals
reduce readmissions, and avoid the penalties
that result from noncompliance.

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For more information:
“This book is a fantastic piece of work”
– Robert Lindeman MD, FAAP, Chief Physician Quality Officer

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More about this topic
Link to original article for a more in-depth discussion.
Hospital Readmissions Reduction Program: Keys to Success
How to Survive CMS’s Most Recent 3% Hospital Readmissions Penalties Increase
Bobbi Brown, Vice President of Financial Engagement
How to Reduce Heart Failure Readmission Rates: One Hospital’s Story
Health Catalyst Success Story
4 Ways to Reduce Penalties Under the Hospital-Acquired Condition Reduction Program
Bobbi Brown, Vice President of Financial Engagement; Michael Barton, Engagement Executive, VP

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© 2016 Health Catalyst
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Bobbi Brown is the Vice President of Financial Engagement for Health Catalyst. Ms.
Brown started her healthcare career at Intermountain Healthcare supporting clinical
integration efforts before moving to Sutter Health and, later, Kaiser Permanente, where
she served as Vice President of Financial Planning and Performance. Ms. Brown holds
an MBA from the Thunderbird School of Global Management as well as a BA in
Spanish and Education from Misericordia University. She regularly writes and teaches
on finance-related healthcare topics.
Other Clinical Quality Improvement Resources
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