In a correction notice published in the October 3, 2012 Federal Register, CMS stated that it erroneously included admission data predating the “applicable period” for the FY 2013 Hospital Readmissions Reduction Program when it calculated the Readmissions Adjustment Factors released in the FY 2013 Hospital IPPS Final Rule.  Contrary to the policy adopted in the Final Rule, it “inadvertently included Medicare inpatient claims from the FY 2008 MedPAR file with discharge dates occurring prior to July 1, 2008 in determining the base operating DRG payment amounts in the calculation of aggregate payments for excess readmissions and aggregate payments for all discharges that were used to calculate the readmissions adjustment factors published for the FY 2013 IPPS/LTCH final rule.”  CMS has published corrected Readmissions Adjustment Factors, and now estimates that 2,217 hospitals will have their base operating DRG payments reduced under the Program (up from 2,206 estimated in the Final Rule).

A decrease in a hospital’s Readmissions Adjustment Factor results in a corresponding increase in the hospital’s penalty under the Program.  Our own calculations indicate that of 3500 listed providers, 1422 hospitals’ (40.6%) Readmissions Adjustment Factors decreased from the values published in the FY 2013 Hospital IPPS Final Rule, published August 31, 2012.  These reductions ranged from 0.01% to 0.11%.  There was no change for 2023 hospitals (57.8%), while Adjustment Factors increased for 55 hospitals (1.6%).

A copy of the correction notice is available by clicking here, and may also be viewed on the CMS website.  The corrected FY 2013 Readmission Payment Adjustment Factors are available in the “Downloads” section of the Readmissions Reduction Program website.

Reporter, Susan Banks, Washington, D.C., +1 202 626 2953, sbanks@kslaw.com.