Impact of the Hospital Readmission Reduction Program (HRRP) on Hospital Readmission and Mortality: An Economic Analysis

Posted: 24 Oct 2018

See all articles by Liangfei Qiu

Liangfei Qiu

University of Florida - Warrington College of Business Administration

Subodha Kumar

Temple University - Department of Marketing and Supply Chain Management

Arun Sen

Texas A&M University - Department of Information & Operations Management

Atish P Sinha

University of Wisconsin - Milwaukee - Sheldon B. Lubar School of Business

Date Written: October 1, 2018

Abstract

Reduction in hospital readmissions has long been identified as a target area for health reform by the U.S. government. In October 2012, the Affordable Care Act (ACA) established the Hospital Readmissions Reduction Program (HRRP) program, which requires the Centers for Medicare and Medicaid Services (CMS) to reduce payments to hospitals with excess readmissions. In this study, we empirically examine the effectiveness of the introduction of the HRRP on hospital readmission and mortality rates. We observe that, in general, the introduction of the HRRP has significantly reduced the readmission rates. However, the introduction of the HRRP does not necessarily decrease the mortality rates. What is more interesting is that the impact of the HRRP is heterogeneous in terms of hospital type, hospital size, and racial groups. First, the HRRP is less effective in reducing readmission rates in veteran hospitals than those in acute care hospitals. Second, after the HRRP introduction, large hospitals have experienced a greater reduction in readmission rates than small hospitals. Third, after the introduction of the HRRP, the zip code regions with a higher percent of Hispanic and African population have experienced a larger reduction in readmission rates. These results provide important and nuanced policy implications for evaluating the effectiveness of the HRRP.

Keywords: Readmission Rate, Mortality Rate, HRRP, Acute Care Hospitals

Suggested Citation

Qiu, Liangfei and Kumar, Subodha and Sen, Arun and Sinha, Atish P, Impact of the Hospital Readmission Reduction Program (HRRP) on Hospital Readmission and Mortality: An Economic Analysis (October 1, 2018). Available at SSRN: https://ssrn.com/abstract=3258730

Liangfei Qiu

University of Florida - Warrington College of Business Administration ( email )

Gainesville, FL 32611
United States

HOME PAGE: http://sites.google.com/site/qiuliangfei/

Subodha Kumar (Contact Author)

Temple University - Department of Marketing and Supply Chain Management ( email )

Philadelphia, PA 19122
United States

Arun Sen

Texas A&M University - Department of Information & Operations Management ( email )

430 Wehner
College Station, TX 77843-4218
United States

Atish P Sinha

University of Wisconsin - Milwaukee - Sheldon B. Lubar School of Business ( email )

P.O. Box 742
3202 N. Maryland Ave.
Milwaukee, WI 53201-0742
United States

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