(Last Updated On: December 2, 2016)

In fiscal year 2016, CMS will collect an estimated $420 million in readmission penalties from hospitals under its Hospital Readmissions Reduction Program (HRRP).  Hospitals should be looking at a combination of Chronic Care Management under the Hospital Outpatient Prospective Payment System (OPPS) and CPT 99495/ 99496 for Transitional Care Management as ways to help reduce readmission penalties. The table below summarizes the distribution of readmission penalties for hospitals in FY 2015 and FY 2016 – a staggering 78.4%1 of hospitals will incur some sort of readmission penalties in 2016 under HRRP:

ReadmissionPenaltyComparison2016

Now what methods can hospitals use to avoid these HRRP penalties? 90% of 30 day hospital readmissions stem from patients with 2+ chronic conditions, which happens to be the same criteria for CCM eligibility (see graph below).

30DayReadmissionRatesForChronicCareManagement

Not only do chronically ill patients count for the majority of readmissions, but 3 out of the 5 measures used to calculate penalties for hospitals are also based on chronic conditions. The five measures used in the calculation of HRRP penalties revolve around the following conditions/procedures:

For this reason, many of the patients that ended up being readmitted within 30 days of discharge and cause hospitals to incur penalties are patients that belong in a Chronic Care Management program. Using Chronic Care Management and Transitional Care Management in concert, hospitals can ensure that discharge instructions are being followed and that the patient is compliant with all treatment protocols. TCM would cover both non-face-to-face coordination services plus a face-to-face follow up visit. Using a TCM/CCM combo, hospitals and affiliated physicians practices stand the best chance of not only generating new revenues but also significantly lowering readmission penalties and improving overall patient care.

 

1 https://www.advisory.com/research/financial-leadership-council/at-the-margins/2015/09/cms-final-readmissions-penalties