83% of hospitals evaluated by CMS get financial penalty

In November, Kaiser Health News reported that 83% of the 3,080 hospitals evaluated by CMS had readmissions that exceeded certain thresholds. CMS enacted a policy of penalizing hospitals that saw too many readmissions in an effort to increase quality (reduce unnecessary patient procedures) at the same time as lowering costs (avoiding paying for unnecessary patient procedures). Understandably, the hospital industry has objected to the readmission measure as imprecise and biased against certain hospitals. The patient readmission metric is undoubtedly imperfect; however, waiting for a perfect measure to be agreed upon by the medical community would likely mean no progress at all.

83% seems like a high number for the percentage of eligible hospitals that failed to demonstrate sufficient progress or had adequate performance. However, it is unclear whether the goals were too lofty, or the penalty was too small, or perhaps most likely, a combination of the two.

A spokesperson for the American Hospital Association pointed out that the timing of this penalty is terrible, given the financial strain that many hospitals experienced this year.