The federal program will wthhold 3% of its standard reimbursement over the next year to Lakeland Regional Health, costing the hospital system an estimated $2.9 million loss in revenue.
LAKELAND — Lakeland Regional Health will lose an estimated $2.9 million in Medicare reimbursement payments over the next year after the federal healthcare program levied its maximum 3% penalty on such payments for excessive readmissions during the past year.
It was the third consecutive year Medicare imposed the maximum penalty, according to government statistics. Lakeland Regional was one of 56 U.S. hospitals, including five in Florida, to get the 3% penalty. Another 2,527 U.S. hospitals received lower penalties for their readmission rates.
Meanwhile, two national organizations recognized Lakeland Regional for its advance digital analytics system.
The Healthcare Information and Management Systems Society, a U.S. not-for-profit organization dedicated to improving health care, recognized Lakeland Regional among 10 other hospitals in the world, and the only one in Florida, for using its advanced analytics system to improve patient care, according to a hospital press statement. The award came after the society conducted an onsite inspection earlier this month.
Also, the College of Healthcare Information Management Executives, a professional organization for information technology officers, named Lakeland Regional as one of the Most Wired health care systems for the fifth time in the last six years.
On the Medicare penalty, the federal government levies it on hospitals with higher-than-average readmissions within 30 days of discharge for six conditions: heart attack, heart failure, pneumonia, hip or knee surgery, chronic obstructive pulmonary disease (COPD) and coronary artery bypass graft surgery, said Caroline Gay, the chief population health officer and chief analytics officer, in a Monday email statement.
The federal government calculates the penalty based on combined readmission rates over a rolling three-year period, she said.
According to the Medicare.gov website, Lakeland Regional performed worse than the national average (in parentheses) on four of the six conditions: heart failure (21.6%), pneumonia (16.5%), hip or knee surgery (4%) and COPD (19.5%). It scored “no different than the national rate” on heart attack (15.7%) and the coronary artery surgery (12.8%).
Lakeland Regional declined The Ledger’s request for statistics on its actual readmission rates.
The federal government assesses the penalties based on a computer algorithm that compares a hospital against others in its region and others of similar size and patient demographics, said Jay Wolfson, associate vice president for health law, policy and safety at the Morsani College of Medicine at the University of South Florida in Tampa.
The government tightens the penalty threshold every year for those hospitals that fail to meet the standard, he added.
Medicare has levied the maximum 3% penalty against Lakeland Regional since fiscal year 2018, which ends on Sept. 30, according to the website. The penalty had increased annually from 0.76% in 2015 to 2.74% in 2017.
Lakeland Regional has been stymied in its efforts to bring the readmission rates down, CEO Elaine Thompson said in an Aug. 26 interview with The Ledger.
“With all our efforts, it’s pretty flat,” she said.
Thompson attributed the high rates to social and economic factors beyond the hospital system’s control, including the high population of low-income residents in the area Lakeland Regional serves. She also cited high drug costs.
Consequently, discharged patients do not always follow through with taking their medications or other follow-up care, Thompson said.
“Medicare presents readmission rates as an objective measure of hospitals, but there are so many complex variables not taken into account, such as areas that struggle socioeconomically and physician shortages,” Gay said. “Polk is the sixth-poorest suburban county in the country, according to the Brookings Institution. Our area is 30% shy of primary care for every 100,000 persons.”
Wolfson acknowledged all those factors are true but do not give a complete picture of the hospital management’s performance. A key issue is how long patients are allowed to stay in the hospital after a procedure.
Hospitals have an incentive to discharge patients because Medicare reimbursements begin declining after an average length of stay, thus the hospital loses money, Wolfson said.
“Whether you have a low-income patient base or not is not the question. It’s appropriate care,” he said. “You still have to ask the question: Why are these patients staying longer?”
In many cases, an additional two days in the hospital would prevent a readmission, Wolfson said.
“We should not be playing roulette with patients. We need to practice good medicine,” he said. “The decision should not be on whether you will be punished by keeping them two (additional) days or punished by releasing them too early.”
Hospitals in New York City and San Francisco have had success with using teams of medical professionals who make home visits after discharge to explain medications and do follow-up care, Wolfson said.
“It’s incredibly cost-effective,” he said.
Lakeland Regional is trying to increase follow-up care by working with other community health care providers, Thompson said.
But the Medicare penalties hamper those efforts, Gay said.
“Penalizing hospitals with higher rates year after year could actually be exacerbating the problem,” she said. “What if those millions of dollars are instead invested in our community programs and getting people access to physicians? We could be working together to create a totally different healthcare picture.”
Kevin Bouffard can be reached at firstname.lastname@example.org or at 863-802-7591. Ledger reporter Sara-Megan Walsh contributed to this report.
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