CMS Credits Obamacare for Slight Decrease in Hospital Readmissions

The Affordable Care Act (ACA) was a key driver in reducing the national rate of hospital readmissions of Medicare beneficiaries within a month of discharge, according to a top Centers for Medicare & Medicaid Services (CMS) official.

As ACA implementation continues to take force, it has already made “significant progress,” CMS said in a Thursday update, noting better health outcomes for Medicare beneficiaries, provider interest in Accountable Care Organizations (ACOs), and slowed growth in healthcare spending. 

The 30-day readmission rate has hovered at about 19% for the past five years, but CMS estimates it decreased slightly to 17.8% in the last half of 2012, translating to about 70,000 fewer rehospitalizations for any cause throughout last year.


That drop in readmissions, according to CMS official Jonathan Blum, is “largely the result of provisions of President Obama’s healthcare law,” reports The Washington Post, listing components of the ACA such as financial penalties for hospitals with Medicare readmissions above an accepted threshold, along with extra funding and incentives for hospitals and outpatient providers to coordinate more comprehensive post-acute care upon discharge. 

The data doesn’t pinpoint why rehospitalizations went down, the Post points out, but CMS stressed the reduction resulted from hospitals putting larger focus on reducing readmissions—partially because of incentives under healthcare reform, and partially because of penalties for failure to do so.

Healthcare spending has been slowing down at a national level, growing by less than 4% in 2011 for the third straight year, said CMS citing the annual Report of National Health Expenditures, while Medicare spending per beneficiary only increased by 0.4%, down from the preceding three years’ 1.9% average growth.


CMS also pointed to the more than 250 organizations—which can include skilled nursing and home healthcare agencies—participating in ACOs, serving about 4 million Medicare beneficiaries. These organizations will save up to an estimated $940 million in their first four years of operation, CMS projects, and more are expected to form. 

Written by Alyssa Gerace