Traditional Medicare May Trump Medicare Advantage in Reducing Readmissions

Despite previously reported findings, traditional Medicare may have a better track record of lowering hospital-readmission risk compared to the Medicare Advantage (MA) program. While the re-hospitalization difference appears to be small, it’s an important observation for home health providers, especially those that work closely with MA plans.

New insights into re-hospitalization rates in Medicare and Medicare Advantage come from a study published earlier in June in the Annals of Internal Medicine

Conducted by researchers from Brown University, the study compares readmission rates between MA and traditional Medicare by analyzing 2011 to 2014 data from the Medicare Provider Analysis and Review (MedPAR) data set, along with the Healthcare Effectiveness Data and Information Set (HEDIS). 

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As a part of the study, researchers compared 30-day readmission rates after hospitalization for three major conditions included in the Hospital Readmissions Reduction Program (HRRP), a Medicare value-based purchasing program that reduces payments to hospitals with excessive readmissions. Those conditions included acute myocardial infarction (AMI), heart failure and pneumonia. 

Hospital readmissions are relatively common and cost Medicare about $26 billion annually, according to the researchers.

For Hospitals, clinicians, and payers such as Medicare, reducing readmission rates has been a major area of focus. Home health providers have played a significant role in those efforts.

Hospitals with worse than expected 30-day readmission rates for common medical conditions are penalized by HRRP. 

Overall, researchers found that MA patients had higher readmission rates than their traditional Medicare peers. AMI MA patients, for example, were found to have readmission rates of 17.2%, compared to 16.9% for those in traditional Medicare.

Readmission rates were similarly higher for MA patients suffering from heart failure and pneumonia as well.

“Previous studies have reported lower readmission rates in Medicare Advantage than traditional Medicare, leading some policy observers to conclude that Medicare Advantage beneficiaries have better post-acute care outcomes,” the researchers wrote. “However, these studies have been limited by the lack of complete and accurate data on hospitalizations in Medicare Advantage.”

Some of the key reasons for the differences in results between this study and prior studies that reported lower readmission rates for Medicare Advantage beneficiaries are the utilization of a more comprehensive data set, the inclusion of comorbid conditions from a “well-validated model” applied by the Centers for Medicare and Medicaid Services (CMS) and the inclusion of national data focused on the three conditions reported in the HRRP.

Additionally, previous investigations focused on readmissions for patients discharged to

Skilled nursing facilities (SNFs) or in-patient rehabilitation facilities (IRFs).

Medicare Advantage enrollment has grown rapidly over the past decade. About one-third of all Medicare beneficiaries – or about 22 million people – signed up for an MA plan in 2019, mirroring similar levels in 2017 and 2018.

Between 2018 and 2019, total MA enrollment grew by about 8%, according to recent statistics from the Kaiser Family Foundation. The Congressional Budget Office projects the share of beneficiaries enrolled in Medicare Advantage plans to increase to about 47% by 2029.

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