After the Medicare Hospital Readmissions Reduction Program began enforcing financial penalties, disparities in readmissions between white and black patients widened at safety-net hospitals for conditions not targeted by the program. Disparities were stable for conditions targeted by the program. At non-safety-net hospitals, disparities were unchanged for both targeted and non-targeted conditions

Chaiyachati, Krisda

Qi, Mingyu

Werner, Rachel

English

Kosmopolis

University of Pennsylvania
ScholarlyCommons
Research Briefs Leonard Davis Institute of Health Economics
12-6-2018
Changes to Racial Disparities in Readmission Rates
After Medicare’s Hospital Readmissions Reduction
Program Within Safety-Net and Non-Safety-Net
Hospitals
Krisda Chaiyachati
University of Pennsylvania
Mingyu Qi
University of Pennsylvania
Rachel Werner
University of Pennsylvania
Follow this and additional works at: https://repository.upenn.edu/ldi_researchbriefs
This paper is posted at ScholarlyCommons. https://repository.upenn.edu/ldi_researchbriefs/48
For more information, please contact repository@pobox.upenn.edu.
Chaiyachati, Krisda; Qi, Mingyu; and Werner, Rachel. Changes to Racial Disparities in Readmission Rates After Medicare’s Hospital
Readmissions Reduction Program Within Safety-Net and Non-Safety-Net Hospitals. LDI Research Briefs. 2018; No. 48.
https://ldi.upenn.edu/brief/changes-racial-disparities-readmission-rates-after-medicare-s-hospital-readmissions-reduction
" >
https://ldi.upenn.edu/brief/changes-racial-disparities-readmission-rates-after-medicare-s-hospital-readmissions-reduction
Changes to Racial Disparities in Readmission Rates After Medicare’s
Hospital Readmissions Reduction Program Within Safety-Net and Non-
Safety-Net Hospitals
Abstract
After the Medicare Hospital Readmissions Reduction Program began enforcing financial penalties, disparities
in readmissions between white and black patients widened at safety-net hospitals for conditions not targeted
by the program. Disparities were stable for conditions targeted by the program. At non-safety-net hospitals,
disparities were unchanged for both targeted and non-targeted conditions.
Keywords
Readmissions, racial disparities, Medicare, safety-net hospitals
License
This work is licensed under a Creative Commons Attribution-No Derivative Works 4.0 License.
This brief is available at ScholarlyCommons: https://repository.upenn.edu/ldi_researchbriefs/48
THE QUESTION
Medicare’s Hospital Readmissions Reduction Program (HRRP) financially 
penalizes hospitals with higher-than-expected 30-day readmission rates 
for select clinical conditions (acute myocardial infarction, pneumonia, 
and heart failure). Since its implementation, readmission rates have 
declined for the HRRP-targeted conditions, and to a lesser degree, for 
non-targeted conditions. There are, however, concerns that the program 
could exacerbate health care disparities by harming “safety-net hospitals” 
– institutions that disproportionately serve minority patients.
This analysis looks across three time periods: 2007-2010, prior to the 
Affordable Care Act (ACA); 2010-2012, during HRRP implementation; 
and, 2012-2015, after the HRRP enforced penalties. It evaluates how 
readmission disparities between black and white patients changed within 
safety-net and non-safety-net hospitals after the HRRP began enforcing 
financial penalties, and how these trends differed for conditions targeted 
and not targeted by HRRP penalties. 
THE FINDINGS
During the implementation phase of the HRRP, disparities in readmission 
rates were improving within both safety-net and non-safety-net hospitals, 
irrespective of the clinical condition. After the enforcement of the HRRP 
penalties, disparities in readmission rates widened within safety-net 
hospitals, specifically for conditions not targeted by HRRP penalties. 
Comparing safety-net and non-safety-net hospitals
Before the ACA (2007-2010), white and black patients discharged from 
safety-net hospitals had relatively higher risk-adjusted readmission rates 
than those from non-safety-net hospitals. The racial disparity remained 
stable during this time, in both safety-net and non-safety net hospitals. 
Overall, readmission rates for black and white patients across safety-net 
and non-safety-net hospitals declined during HRRP’s implementation 
(2010-2012). In safety-net hospitals, black patients had a steeper decline 
in readmission rates than white patients, resulting in a slight narrowing 
CHANGES TO RACIAL DISPARITIES IN READMISSION RATES AFTER 
MEDICARE’S HOSPITAL READMISSIONS REDUCTION PROGRAM 
WITHIN SAFETY-NET AND NON-SAFETY-NET HOSPITALS
JAMA Network Open – published November 2, 2018
Krisda H. Chaiyachati, Mingyu Qi, Rachel M. Werner
KEYFINDINGS 
After the Medicare Hospital Readmissions Reduction Program began enforcing financial penalties, disparities in 
readmissions between white and black patients widened at safety-net hospitals for conditions not targeted by the 
program. Disparities were stable for conditions targeted by the program. At non-safety-net hospitals, disparities were 
unchanged for both targeted and non-targeted conditions. 
DATA  D R I V E N . P O L I C Y  F O C U S E D
BRIEFResearchLDI
Research to Improve the Nation’s Health System   2018 . No. 16
COLONIAL PENN CENTER   |   3641 LOCUST WALK   |   PHILADELPHIA, PA 19104-6218   |   LDI.UPENN.EDU   |   P: 215-898-5611   |   F: 215-898-0229   |    @PENNLDI
BRIEFResearchLDI
of disparities in readmission rates. Non-safety-net hospitals also saw a 
narrowing of disparities in readmission rates during this time, but at an 
even smaller magnitude. 
Readmissions disparities stopped improving during the HRRP penalty 
period (2012-2015). During this time, readmission disparities widened in 
safety-net hospitals (0.04 percentage point per quarter), whereas they 
remained stable in non-safety-net hospitals. 
Changes in readmission disparities for targeted and non-targeted 
conditions
During the pre-ACA and HRRP implementation periods, the observed 
trends in black and white readmissions did not differ for HRRP-targeted 
conditions and non-targeted conditions in either safety-net or non-
safety-net hospitals. 
However, when the authors compared readmissions by condition 
during the HRRP penalty period, readmission disparities widened (0.05 
percentage point per quarter) within safety-net hospitals for conditions 
not targeted by the HRRP, while disparities for HRRP-targeted conditions 
did not change. Readmission disparities were stable for both targeted and 
non-targeted conditions in non-safety-net hospitals during this period.
THE IMPLICATIONS
This study shows that hospital-based financial incentives may exacerbate 
health care disparities. It highlights how financial penalties for hospital 
readmissions have potential consequences for conditions not targeted 
by the penalties, and that safety-net hospitals are particularly sensitive 
to this risk. The findings suggest that when readmission penalties target 
certain clinical conditions, scarce resources could shift away from other 
operational objectives and affect quality for non-targeted conditions. 
Although the increases in racial disparities in hospital readmission rates 
observed in this study are relatively modest, conditions not targeted by 
the HRRP represent six times more discharges than targeted conditions 
(86.5 percent vs. 13.5 percent). This means that even small increases in 
disparities could have consequences for a larger portion of the population. 
The HRRP has reduced Medicare payments to safety-net hospitals by 
one to three percent. If payments are reduced, safety-net hospitals have 
less revenue to invest in quality-improvement programs, thus potentially 
widening existing disparities. These findings point to the HRRP’s potential 
longer-term consequences on readmission disparities between white and 
black patients, especially for those served by safety-net hospitals. 
Reducing disparities in readmission rates will require an understanding of 
hospital strategies that lead to persistent reductions among vulnerable 
populations. The Centers for Medicare & Medicaid Services and the 
National Quality Forum are considering hospital-wide readmission 
measures, which may help to mitigate differences in trends by clinical 
condition. However, these programs may impose higher penalties 
on more hospitals, penalties to which safety-net hospitals are already 
particularly sensitive. 
THE STUDY
This study looked at nearly 60 million discharges of Medicare fee-for-
service beneficiaries with any clinical condition from 3,871 acute-care 
hospitals between January 1, 2007 and September 30, 2015. About one 
fifth of discharges were from safety-net hospitals, defined as the those 
with the highest proportion of Medicaid discharges in each state.
The analysis relies on three data sources: (1) Medicare Provider Analysis 
and Review files and the Medicare Beneficiary Summary File, which 
include data on demographics and enrollment, and hospital claims for 
fee-for-service Medicare beneficiaries; (2) Medicare Provider of Services 
files, which include hospital characteristics; (3) the American Hospital 
Association Annual Survey of Hospitals, which includes data on Medicaid 
discharges at each hospital. All estimates were adjusted for patient and 
hospital characteristics. 
The authors were primarily interested in whether a patient had an 
unplanned readmission within 30 days of hospital discharge. They 
assessed the patient’s race (white or black), the quarter in which the 
patient was discharged, the clinical condition, and whether or not the 
discharging hospital was a safety-net hospital. They measured changes 
in disparities in safety-net and non–safety-net hospitals after the HRRP 
penalties were enforced and compared with prior trends. 
Chaiyachati KH, Qi M, Werner RM. Changes to Racial Disparities in 
Readmission Rates After Medicare’s Hospital Readmissions Reduction 
Program Within Safety-Net and Non–Safety-Net Hospitals. JAMA Netw 
Open. 2018;1(7):e184154. doi:10.1001/jamanetworkopen.2018.4154
THE FINDINGS SUGGEST THAT WHEN 
READMISSION PENALTIES TARGET CERTAIN 
CLINICAL CONDITIONS, SCARCE RESOURCES 
COULD SHIFT AWAY FROM OTHER 
OPERATIONAL OBJECTIVES AND AFFECT 
QUALITY FOR NON-TARGETED CONDITIONS. 
LEAD AUTHOR
DR. KRISDA CHAIYACHATI
Krisda Chaiyachati, MD, MPH, MSHP, is an Assistant Professor of Medicine at the University of Pennsylvania. He designs, studies, and 
implements innovative strategies for improving health care accessibility, addressing social barriers to care, and managing population health 
goals. His research seeks to understand how to improve health outcomes for low-income and minority populations. 


Changes to Racial Disparities in Readmission Rates After Medicare’s Hospital Readmissions Reduction Program Within Safety-Net and Non-Safety-Net Hospitals

ScholarlyCommons@Penn

University of PennsylvaniaScholarlyCommonsResearch Briefs Leonard Davis Institute of Health Economics12-6-2018Changes to Racial Disparities in Readmission RatesAfter Medicare’s Hospital Readmissions ReductionProgram Within Safety-Net and Non-Safety-NetHospitalsKrisda ChaiyachatiUniversity of PennsylvaniaMingyu QiUniversity of PennsylvaniaRachel WernerUniversity of PennsylvaniaFollow this and additional works at: https://repository.upenn.edu/ldi_researchbriefsThis paper is posted at ScholarlyCommons. https://repository.upenn.edu/ldi_researchbriefs/48For more information, please contact repository@pobox.upenn.edu.Chaiyachati, Krisda; Qi, Mingyu; and Werner, Rachel. Changes to Racial Disparities in Readmission Rates After Medicare’s HospitalReadmissions Reduction Program Within Safety-Net and Non-Safety-Net Hospitals. LDI Research Briefs. 2018; No. 48.https://ldi.upenn.edu/brief/changes-racial-disparities-readmission-rates-after-medicare-s-hospital-readmissions-reduction" >https://ldi.upenn.edu/brief/changes-racial-disparities-readmission-rates-after-medicare-s-hospital-readmissions-reductionChanges to Racial Disparities in Readmission Rates After Medicare’sHospital Readmissions Reduction Program Within Safety-Net and Non-Safety-Net HospitalsAbstractAfter the Medicare Hospital Readmissions Reduction Program began enforcing financial penalties, disparitiesin readmissions between white and black patients widened at safety-net hospitals for conditions not targetedby the program. Disparities were stable for conditions targeted by the program. At non-safety-net hospitals,disparities were unchanged for both targeted and non-targeted conditions.KeywordsReadmissions, racial disparities, Medicare, safety-net hospitalsLicenseThis work is licensed under a Creative Commons Attribution-No Derivative Works 4.0 License.This brief is available at ScholarlyCommons: https://repository.upenn.edu/ldi_researchbriefs/48THE QUESTIONMedicare’s Hospital Readmissions Reduction Program (HRRP) financially penalizes hospitals with higher-than-expected 30-day readmission rates for select clinical conditions (acute myocardial infarction, pneumonia, and heart failure). Since its implementation, readmission rates have declined for the HRRP-targeted conditions, and to a lesser degree, for non-targeted conditions. There are, however, concerns that the program could exacerbate health care disparities by harming “safety-net hospitals” – institutions that disproportionately serve minority patients.This analysis looks across three time periods: 2007-2010, prior to the Affordable Care Act (ACA); 2010-2012, during HRRP implementation; and, 2012-2015, after the HRRP enforced penalties. It evaluates how readmission disparities between black and white patients changed within safety-net and non-safety-net hospitals after the HRRP began enforcing financial penalties, and how these trends differed for conditions targeted and not targeted by HRRP penalties. THE FINDINGSDuring the implementation phase of the HRRP, disparities in readmission rates were improving within both safety-net and non-safety-net hospitals, irrespective of the clinical condition. After the enforcement of the HRRP penalties, disparities in readmission rates widened within safety-net hospitals, specifically for conditions not targeted by HRRP penalties. Comparing safety-net and non-safety-net hospitalsBefore the ACA (2007-2010), white and black patients discharged from safety-net hospitals had relatively higher risk-adjusted readmission rates than those from non-safety-net hospitals. The racial disparity remained stable during this time, in both safety-net and non-safety net hospitals. Overall, readmission rates for black and white patients across safety-net and non-safety-net hospitals declined during HRRP’s implementation (2010-2012). In safety-net hospitals, black patients had a steeper decline in readmission rates than white patients, resulting in a slight narrowing CHANGES TO RACIAL DISPARITIES IN READMISSION RATES AFTER MEDICARE’S HOSPITAL READMISSIONS REDUCTION PROGRAM WITHIN SAFETY-NET AND NON-SAFETY-NET HOSPITALSJAMA Network Open – published November 2, 2018Krisda H. Chaiyachati, Mingyu Qi, Rachel M. WernerKEYFINDINGS After the Medicare Hospital Readmissions Reduction Program began enforcing financial penalties, disparities in readmissions between white and black patients widened at safety-net hospitals for conditions not targeted by the program. Disparities were stable for conditions targeted by the program. At non-safety-net hospitals, disparities were unchanged for both targeted and non-targeted conditions. DATA  D R I V E N . P O L I C Y  F O C U S E DBRIEFResearchLDIResearch to Improve the Nation’s Health System   2018 . No. 16COLONIAL PENN CENTER   |   3641 LOCUST WALK   |   PHILADELPHIA, PA 19104-6218   |   LDI.UPENN.EDU   |   P: 215-898-5611   |   F: 215-898-0229   |    @PENNLDIBRIEFResearchLDIof disparities in readmission rates. Non-safety-net hospitals also saw a narrowing of disparities in readmission rates during this time, but at an even smaller magnitude. Readmissions disparities stopped improving during the HRRP penalty period (2012-2015). During this time, readmission disparities widened in safety-net hospitals (0.04 percentage point per quarter), whereas they remained stable in non-safety-net hospitals. Changes in readmission disparities for targeted and non-targeted conditionsDuring the pre-ACA and HRRP implementation periods, the observed trends in black and white readmissions did not differ for HRRP-targeted conditions and non-targeted conditions in either safety-net or non-safety-net hospitals. However, when the authors compared readmissions by condition during the HRRP penalty period, readmission disparities widened (0.05 percentage point per quarter) within safety-net hospitals for conditions not targeted by the HRRP, while disparities for HRRP-targeted conditions did not change. Readmission disparities were stable for both targeted and non-targeted conditions in non-safety-net hospitals during this period.THE IMPLICATIONSThis study shows that hospital-based financial incentives may exacerbate health care disparities. It highlights how financial penalties for hospital readmissions have potential consequences for conditions not targeted by the penalties, and that safety-net hospitals are particularly sensitive to this risk. The findings suggest that when readmission penalties target certain clinical conditions, scarce resources could shift away from other operational objectives and affect quality for non-targeted conditions. Although the increases in racial disparities in hospital readmission rates observed in this study are relatively modest, conditions not targeted by the HRRP represent six times more discharges than targeted conditions (86.5 percent vs. 13.5 percent). This means that even small increases in disparities could have consequences for a larger portion of the population. The HRRP has reduced Medicare payments to safety-net hospitals by one to three percent. If payments are reduced, safety-net hospitals have less revenue to invest in quality-improvement programs, thus potentially widening existing disparities. These findings point to the HRRP’s potential longer-term consequences on readmission disparities between white and black patients, especially for those served by safety-net hospitals. Reducing disparities in readmission rates will require an understanding of hospital strategies that lead to persistent reductions among vulnerable populations. The Centers for Medicare & Medicaid Services and the National Quality Forum are considering hospital-wide readmission measures, which may help to mitigate differences in trends by clinical condition. However, these programs may impose higher penalties on more hospitals, penalties to which safety-net hospitals are already particularly sensitive. THE STUDYThis study looked at nearly 60 million discharges of Medicare fee-for-service beneficiaries with any clinical condition from 3,871 acute-care hospitals between January 1, 2007 and September 30, 2015. About one fifth of discharges were from safety-net hospitals, defined as the those with the highest proportion of Medicaid discharges in each state.The analysis relies on three data sources: (1) Medicare Provider Analysis and Review files and the Medicare Beneficiary Summary File, which include data on demographics and enrollment, and hospital claims for fee-for-service Medicare beneficiaries; (2) Medicare Provider of Services files, which include hospital characteristics; (3) the American Hospital Association Annual Survey of Hospitals, which includes data on Medicaid discharges at each hospital. All estimates were adjusted for patient and hospital characteristics. The authors were primarily interested in whether a patient had an unplanned readmission within 30 days of hospital discharge. They assessed the patient’s race (white or black), the quarter in which the patient was discharged, the clinical condition, and whether or not the discharging hospital was a safety-net hospital. They measured changes in disparities in safety-net and non–safety-net hospitals after the HRRP penalties were enforced and compared with prior trends. Chaiyachati KH, Qi M, Werner RM. Changes to Racial Disparities in Readmission Rates After Medicare’s Hospital Readmissions Reduction Program Within Safety-Net and Non–Safety-Net Hospitals. JAMA Netw Open. 2018;1(7):e184154. doi:10.1001/jamanetworkopen.2018.4154THE FINDINGS SUGGEST THAT WHEN READMISSION PENALTIES TARGET CERTAIN CLINICAL CONDITIONS, SCARCE RESOURCES COULD SHIFT AWAY FROM OTHER OPERATIONAL OBJECTIVES AND AFFECT QUALITY FOR NON-TARGETED CONDITIONS. LEAD AUTHORDR. KRISDA CHAIYACHATIKrisda Chaiyachati, MD, MPH, MSHP, is an Assistant Professor of Medicine at the University of Pennsylvania. He designs, studies, and implements innovative strategies for improving health care accessibility, addressing social barriers to care, and managing population health goals. His research seeks to understand how to improve health outcomes for low-income and minority populations. 

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Changes to Racial Disparities in Readmission Rates After Medicare’s Hospital Readmissions Reduction Program Within Safety-Net and Non-Safety-Net Hospitals

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