Association of Inclusion of Medicare Advantage Patients in Hospitals’ Risk-Standardized Readmission Rates, Performance, and Penalty Status

IMPORTANCE: The Hospital Readmissions Reduction Program publicly reports and financially penalizes hospitals according to 30-day risk-standardized readmission rates (RSRRs) exclusively among traditional Medicare (TM) beneficiaries but not persons with Medicare Advantage (MA) coverage. Exclusively reporting readmission rates for the TM population may not accurately reflect hospitals’ readmission rates for older adults. OBJECTIVE: To examine how inclusion of MA patients in hospitals’ performance is associated with readmission measures and eligibility for financial penalties. DESIGN, SETTING, AND PARTICIPANTS: This is a retrospective cohort study linking the Medicare Provider Analysis and Review file with the Healthcare Effectiveness Data and Information Set at 4070 US acute care hospitals admitting both TM and MA patients. Participants included patients admitted and discharged alive with a diagnosis of acute myocardial infarction (AMI), congestive heart failure (CHF), or pneumonia between 2011 and 2015. Data analyses were conducted between April 1, 2018, and November 20, 2020. EXPOSURES: Admission to an acute care hospital. MAIN OUTCOMES AND MEASURES: The outcome was readmission for any reason occurring within 30 days after discharge. Each hospital’s 30-day RSRR was computed on the basis of TM, MA, and all patients and estimated changes in hospitals’ performance and eligibility for financial penalties after including MA beneficiaries for calculating 30-day RSRRs. RESULTS: There were 748 033 TM patients (mean [SD] age, 76.8 [83] years; 360 692 [48.2%] women) and 295 928 MA patients (mean [SD] age, 77.5 [7.9] years; 137 422 [46.4%] women) hospitalized and discharged alive for AMI; 1 327 551 TM patients (mean [SD] age, 81 [8.3] years; 735 855 [55.4%] women) and 457 341 MA patients (mean [SD] age, 79.8 [8.1] years; 243 503 [53.2%] women) for CHF; and 2 017 020 TM patients (mean [SD] age, 80.7 [8.5] years; 1 097 151 [54.4%] women) and 610 790 MA patients (mean [SD] age, 79.6 [8.2] years; 321 350 [52.6%] women) for pneumonia. The 30-day RSRRs for TM and MA patients were correlated (correlation coefficients, 0.31 for AMI, 0.40 for CHF, and 0.41 for pneumonia) and the TM-based RSRR systematically underestimated the RSRR for all Medicare patients for each condition. Of the 2820 hospitals with 25 or more admissions for at least 1 of the outcomes of AMI, CHF, and pneumonia, 635 (23%) had a change in their penalty status for at least 1 of these conditions after including MA data. Changes in hospital performance and penalty status with the inclusion of MA patients were greater for hospitals in the highest quartile of MA admissions. CONCLUSIONS AND RELEVANCE: In this cohort study, the inclusion of data from MA patients changed the penalty status of a substantial fraction of US hospitals for at least 1 of 3 reported conditions. This suggests that policy makers should consider including all hospital patients, regardless of insurance status, when assessing hospital quality measures.