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Brief Report
October 14, 2020

Misclassification of Hospital Performance Under the Hospital Readmissions Reduction Program: Implications for Value-Based Programs

Author Affiliations
  • 1Richard A. and Susan F. Smith Center for Outcomes Research in Cardiology, Beth Israel Deaconess Medical Center, Harvard Medical School, Boston, Massachusetts
JAMA Cardiol. Published online October 14, 2020. doi:10.1001/jamacardio.2020.4746
Key Points

Question  The Hospital Readmissions Reduction Program (HRRP) uses point estimates of 30-day risk-standardized readmission rates (RSRRs) to compare hospitals, but the margin of error around each estimate may affect the program’s ability to accurately evaluate performance; what is the rate at which the hospitals’ penalty status is misclassified under the HRRP?

Findings  In this cross-sectional study of hospitals that participated in the HRRP in fiscal year 2019, the percentages of hospitals that should have been penalized by the program, but were not, was 20.9% for acute myocardial infarction, 13.5% for heart failure, and 13.2% for pneumonia. In contrast, the percentages of hospitals that were incorrectly penalized was 10.1% for acute myocardial infarction, 10.9% for heart failure, and 12.3% for pneumonia.

Meaning  In this analysis, the 30-day RSRR resulted in substantial misclassification of penalty status under the HRRP, suggesting that this measure cannot reliably distinguish hospital performance.

Abstract

Importance  The Centers for Medicare and Medicaid Services (CMS) use point estimates of 30-day risk-standardized readmission rates (RSRRs) to compare hospitals under the Hospital Readmissions Reduction Program (HRRP). An important characteristic of this measure is that it is a point estimate with a margin of error, which may affect the CMS’s ability to accurately evaluate and distinguish hospital performance in the program.

Objective  To determine the number and percentage of hospitals with a penalty status misclassified under the HRRP.

Design, Setting, and Participants  This cross-sectional study used the bayesian deconvolution method to estimate the rate of penalty status misclassification for hospitals participating in the HRRP in fiscal year 2019, using data from the CMS Hospital Compare website that were collected between July 1, 2014, and June 30, 2017. Beneficiaries of Medicare fee-for-service coverage who were 65 years or older and hospitalized with acute myocardial infarction, heart failure, or pneumonia in hospitals with 25 or more discharges per condition were included in the data set. Data analysis occurred from November 2019 to July 2020.

Exposures  None.

Main Outcomes and Measures  The rate of penalty status misclassification for acute myocardial infarction, heart failure, or pneumonia under the HRRP.

Results  The study included 1633, 2626, and 2705 hospitals for acute myocardial infarction, heart failure, and pneumonia, respectively, that participated in the HRRP in fiscal year 2019. The percentages of hospitals that should have been penalized, but were not, were 20.9% (95% CI, 16.0%-25.8%) for acute myocardial infarction, 13.5% (95% CI, 9.8%-17.2%) for heart failure, and 13.2% (95% CI, 10.3%-16.1%) for pneumonia. In contrast, the percentages of hospitals that were incorrectly penalized by the HRRP were 10.1% (95% CI, 5.8%-14.4%) for acute myocardial infarction, 10.9% (95% CI, 7.2%-14.6%) for heart failure, and 12.3% (95% CI, 9.9%-14.6%) for pneumonia.

Conclusions and Relevance  The margin of error associated with the 30-day RSRRs resulted in the misclassification of condition-specific penalty status for up to 31% of hospitals. These findings suggest that the hospital-level 30-day RSRR measure may not reliably distinguish hospital performance in the HRRP. This has important implications for CMS value-based programs that use risk-standardized outcomes to evaluate and compare hospital performance.

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