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Medicare's Hospital Readmissions Reduction Program and the Rise in Observation Stays
Journal article   Open access   Peer reviewed

Medicare's Hospital Readmissions Reduction Program and the Rise in Observation Stays

Brad Wright, Canada Parrish, Anirban Basu, Karen E Joynt Maddox, Joshua M Liao and Amber K Sabbatini
Health services research, Vol.58(3), pp.554-559
06/2023
DOI: 10.1111/1475-6773.14142
PMCID: PMC10154161
PMID: 36755372
url
https://doi.org/10.1111/1475-6773.14142View
Published (Version of record) Open Access

Abstract

To evaluate whether Medicare's Hospital Readmissions Reduction Program (HRRP) is associated with increased observation stay use. A nationally representative sample of fee-for-service Medicare claims, January 2009 - September 2016. Using a difference-in-difference (DID) design, we modeled changes in observation stays as a proportion of total hospitalizations, separately comparing the initial (acute myocardial infarction, pneumonia, heart failure) and subsequent (chronic obstructive pulmonary disease) target conditions with a control group of nontarget conditions. Each model used 3 time periods: baseline (15 months before program announcement), an intervening period between announcement and implementation, and a 2-year post-implementation period, with specific dates defined by HRRP policies. We derived a 20% random sample of all hospitalizations for beneficiaries continuously enrolled for 12 months before hospitalization (N=7,162,189). Observation stays increased similarly for the initial HRRP target and nontarget conditions in the intervening period (0.01 percentage points per month [95% CI -0.01, 0.3]). Post-implementation, observation stays increased significantly more for target versus nontarget conditions, but the difference is quite small (0.02 percentage points per month [95% CI 0.002, 0.04]). Results for the COPD analysis were statistically insignificant in both policy periods. The increase in observation stays is likely due to other factors, including audit activity and clinical advances.
Recovery Audit Contractors Inpatient Hospital Readmissions Reduction Program Observation stays Difference-in-differences Medicare

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