Three North Texas Hospitals Penalized for High Readmission Rate

Three North Texas Hospitals must pay the government’s highest 3% Medicare penalty rate as punishment for a high level of readmitting patients within 30 days after their initial care.

Readmission rate tracking and Medicare penalties were introduced in 2012 with the Affordable Care Act to promote better care.

Kaiser Health News has been tracking the government data and published the 2023 results with links to past data.

KHN writer Jordan Rau said readmission is expensive for the government and difficult for patients.

“This is the first of a number of programs that actually tried to bring quality metrics to determine how much a hospital gets paid,” Rau said. “We want to see how the industry is responding. We think that’s in the public interest.”

A spokesperson with the Centers for Medicare and Medicaid Services (CMS) confirmed three DFW-area hospitals received the 3% penalty for Fiscal Year 2023 under CMS’ Hospital Readmissions Reduction Program (HRRP):

• Baylor Scott and White Medical Center Uptown (Dallas): CCN 450422
  • Penalized 3% in FY 2023
• Baylor Scott and White Surgical Hospital (Fort Worth): CCN 450880
  • Penalized 3% in FY 2023
• Methodist Hospital for Surgery (Addison): CCN 670073
  • Penalized 3% in FY 2023

The penalty will reduce the amount the hospitals receive as payment for every Medicare or Medicaid patient for the entire fiscal year that began in October 2022 through September 2023.

The CMS spokesperson confirmed that all 3 hospitals were also punished in the readmission program for FY 2022 but Methodist in Addison received a lower 1.44% penalty. The Baylor Scott and White Uptown Dallas and Fort Worth Surgical Hospitals received the same 3% penalty in the prior year.

Of some 3,500 hospitals nationwide, KHN found just 17 received the 3% penalty for FY 2023. Rau said fewer were penalized this year compared with last because the government relaxed some criteria due to the COVID-19 pandemic.

Baylor Scott and White spokesman Matt Olivolo pointed out that surgical centers in question generally perform outpatient procedures and send patients home each night.  He said they have very few Medicare patients and the low number may skew results.

But, Rau said CMS divides facilities into five different categories for an appropriate comparison among similar hospitals.

“You definitely are going to have much higher levels of readmissions there,” he said.

Rau said the penalty is significant since hospitals often complain Medicare payments are too small, to begin with.

“I would not call a penalty even at the highest level to be an automatic strike and there’s a bunch of reasons for that,” Rau said.

Variations from year to year of the pool of patients can change results. The doctor performing a procedure and the general reputation of a facility should also be considered, Rau said.

Olivolo provided an e-mail statement from Baylor Scott and White.

“These two surgical hospitals have been recognized for high-quality patient care by various sources, including US News & World Report. It is important to note that readmissions not related to the surgical procedure performed are included in this calculation,” the statement said.

Methodist Hospital Addison did not immediately respond to NBC 5's requests for comment.