CMS touts lower readmission rates

The Center for Medicare & Medicaid Services recently reported that hospital readmissions have been dropping in 2012 and 2013. The suggestion, of course, is that the new incentives that they have rolled out are responsible, and that this portends lower growth in health care costs.

That the fall in readmissions rate is related to the new incentive programs seems pretty likely, given that the rate held constant for the five years prior to rollout of the incentive programs. What is less clear is whether there are any side effects that we don't know about. For example, is it possible that hospitals have tightened their guidelines for readmissions where subjective judgement is involved? Alternatively, are other services being used more heavily? (That by itself might not be negative since those other services presumably cost less than hospitalizations, but would still be relevant when figuring the total benefit of the new incentives.) As CMS noted in their blog post, it is still too early for any definitive pronouncements, but this is an encouraging sign that measuring and rewarding performance can be effective, even in the health care industry.