More Than Half of California's Hospitals Dinged for Readmissions

The federal government is fining 64 percent of California hospitals for having too many Medicare patients return to the hospital within a month of being discharged, according to an analysis of Medicare data by Kaiser Health News.

Sutter Surgical Hospital North Valley in Yuba City was the only facility in the state that received the maximum 3 percent fine. Chinese Hospital in San Francisco received the second highest fine: 2.16 percent of all Medicare billings in the coming year.

“Any little bit hurts. We will definitely feel it,” says Peggy Cmiel, chief nursing officer at Chinese Hospital.

The fines are meant to encourage hospitals to do a better job of caring for patients after they’re released. In the past, many hospitals benefited if a patient returned after surgery – more treatment meant more money. Now, the Medicare program that pays for those treatments wants to reverse the trend by fining hospitals that don't do a good enough job transitioning patients out of the hospital.

Nationwide, a record total of 2,610 hospitals were fined this year, according to the Kaiser analysis. Nearly 18 percent of Medicare patients who had been hospitalized were readmitted within 30 days. Officials estimate $17 billion is spent on potentially avoidable readmissions. They expect to recoup $428 million in fines over the next year.

The fines began three years ago and were applied only to patients hospitalized for heart failure, heart attack, and pneumonia. This year, Medicare added chronic lung ailments, as well as elective knee and hip replacements to the list.

This is the first year that Sutter Surgical Hospital North Valley is on the list. It incurred no fines in the last two years, then received the maximum this year.

Hospital executives declined to comment.

Safety Net Hospitals Say Fines Unfair

Chinese Hospital in San Francisco sees an unusually large proportion of low-income, immigrant patients with limited English skills. Many have congestive heart failure or chronic lung problems.

“I rarely have a day in here that we don’t have a patient that’s over 100 years old,” says Cmiel, the hospital's chief nursing officer.

She says the hospital set up a comprehensive program four years ago in anticipation of the fines for readmissions. They have a team of bilingual and trilingual nurses and social workers who meet with patients before they’re discharged and call and visit patients after they’ve returned home. They make sure patients understand and adhere to their medications and help them get to their follow-up appointments. But Cmiel acknowledges that sometimes even all of that is not enough.

“After a certain age, no matter how well, as medical professionals we try to manage their illness, there’s a point where it may not work anymore,” she says.

Many of their patients live alone and can become very frightened if they have trouble breathing for example.

“It’s just not shocking that they call 911 and want to go to the hospital,” she says.

She says the hospital has decreased its readmission rates by almost 30 percent in the last year. But Medicare doesn’t take individual hospital improvements into account in its calculations. It measures rates against a national standard that they deem appropriate.

It also makes no concessions for safety-net hospitals that care for a large number of low-income or immigrant patients, who face more obstacles to follow-up care and are more likely to get sick.

Cmiel says both of these things came into play for Chinese Hospital. She and other health care experts say that the punishments levied against such hospitals are too harsh or even unfair.

“It seems wrong to me to be making your savings based on a very vulnerable, fragile patient population,” she says. “It doesn’t make sense to me.”