Readmission Reduction Incentive Program
The Maryland Readmissions Reduction Incentive Program (RRIP) incentivizes hospitals to reduce avoidable readmissions by linking rewards and penalties to improvements in readmissions rates. Readmissions occur when a patient is discharged from a hospital and is admitted to any hospital within 30 days of the discharge. Preventable hospitals readmissions may result from complications from previous hospitalization and/or inadequate care coordination, and generate substandard care quality for patients and unnecessary costs. The RRIP compares all-payer readmission rates adjusted for the severity of illness (casemix) for all types of inpatient visits for the calendar year with the rates in the base year (Calendar Year 2013).
Most hospitals in the nation are subject to penalties based on their performance on certain diagnosis-specific Medicare readmissions as part of the federal Medicare Hospital Readmissions Reduction Program (HRRP).The Commission made an initial attempt to encourage reductions in unnecessary readmissions when it created the Admission-Readmission Revenue (ARR) program in 2011. The ARR program limited the amount a hospital could charge per admission episode, providing strong financial incentives to reduce hospital readmissions. The rationale for moving towards an episode-based payment model was to encourage hospitals to reduce readmissions and keep the savings from such reductions. To ensure savings were passed on the public, the Commission also created a complimentary program, The Readmission Shared Savings Policy (RSSP) which reduced the hospital payment rates by a prospective amount.
Current Readmissions Reduction Incentive Program (RRIP)
On January 1, 2014 the State of Maryland entered into a new All-Payer Model demonstration contract with the Center for Medicare and Medicaid Innovation. Among other provisions of this contract, the State is required to reduce the statewide Medicare fee-for-service readmission rate to the national Medicare readmission rate level over the 5-year contract term and make yearly progress towards reducing this gap. In order to meet the new Model requirements, the Commission approved the Readmissions Reduction Incentive Program (RRIP) in April 2014 to further increase the incentives to reduce unnecessary readmissions. The RRIP began to impact hospital revenue starting in Rate Year 2016, with the first performance year of Calendar Year 2014. The initial program focused on providing a set amount of rewards for strong reductions in readmission rates. As the program evolved, penalties were added together with sliding scale payment adjustments that recognized the variation in performance. Lastly, for the Calendar Year 2016 performance year, the Commission changed the methodology to measure hospital performance as the better of attainment (already at a high performing level) or improvement to determine payment adjustments, which strengthens incentives for low-performing hospitals to improve and avoids penalizing high-performing hospitals.
The HSCRC established the following guiding principles for the RRIP through stakeholder input from the performance work group:
Key program components of RRIP methodology:
Key program components of RRIP scoring:
Rate Year 18
Rate Year 17
Prior information below - being formatted as above