A New Medicare Penalty Puts the Focus on Community Health

6190 Powers Ferry Road 

Suite 310

Atlanta, GA 30339



  • LinkedIn Social Icon
  • Twitter Social Icon
  • Facebook Social Icon


A New Medicare Penalty Puts the Focus on Community Health

February 13, 2014

FEB 13, 2014 } Anisha Hegde (Link to the Roosevelt Institute Blog)


The Affordable Care Act could force the U.S. to expand community health programs, and that would be good for patients.


With the implementation of the Affordable Care Act (ACA), hospitals will be penalized if Medicare patients are readmitted within a month for several illnesses, including heart attacks and pneumonia, and private insurers are likely to follow suit. This component of health reform provides fertile ground for a fortification of community health, which focuses on improving the wellness of a geographic area largely through preventive measures.


Before health reform, readmitting patients soon after their discharge allowed hospitals to fill beds and receive more money from Medicare by billing for the hospital stay and treatment. The New England Journal of Medicine estimated that this incentivizing of superfluous re-hospitalizations was costing Medicare $17.4 billion annually. Now, however, hospitals are encouraged more than ever to pay attention to what happens to their patients after they are discharged.


Although the punishment of unnecessary readmissions is an imperfect solution, as the burden of punishment may fall heavily and unfairly on hospitals that treat very sick and very poor patients, it does put the focus on bolstering primary health care for the country’s most vulnerable patients. In a law that includes stipulations such as paying physicians a flat rate for Medicare visits no matter the complexity of a patient’s illness – a stipulation that has forced many physicians to reduce the number of Medicare patients they treat – the penalizing of unnecessary readmissions could be one stipulation that revitalizes community health.


Thus far, this renewed focus on community health has taken the form of hospitals setting up follow-up appointments for patients who lack primary care physicians. or sending nurses to visit with patients at home. Funding and personnel support for these initiatives is coming largely from community health foundations and nonprofits such as Sun Health. As a New York Times article relates, nurse home visits reduce re-hospitalizations by explaining to patients in a more intimate setting the importance of their medications and the side effects they could experience and, if necessary, by recommending that the patients seek an alternative prescription. Nurses are also effective at sending patients back to the hospital when they truly do need to be readmitted. Additionally, hospitals are contracting with companies such as PREMEDEX whose employees call patients post-discharge to ask important questions geared toward health maintenance, such as if the patients have had any fever or pain since they left the hospital.


As many millennials prepare to enter health professions, we have an opportunity to reshape the system. This means pursuing existing programs like PREMEDEX and continuing to amplify and support the primary care physician core, but also exploring novel ways of tracking and promoting community health. For instance, the U.S. could take a page from the playbook of developing countries like Ethiopia and Rwanda, where doctors and nurses train trusted members of a community to help individuals understand preventive care practices and cope with treatment plans. The U.S. has about 38,000 community health workers, but unlike in other countries, their roles are nebulous, they do not have to go through a standardized accreditation process, and they lack a clearly structured source of funding. A study by the American Public Health Association found that the intentional and structured employment of these workers would result in savings for both patients and providers.


As the Affordable Care Act is implemented and Medicare penalties are incrementally increased to their prescribed level by October 2015, policymakers at all levels must evaluate the gaps that health reform leaves to be filled – namely how to construct the bridge between the newly insured population and health actors whose roles have been redefined, such as hospitals now having a stake in preventive health and primary care clinics now serving a larger population. The success of organizations such as Sun Health in reducing re-hospitalization has already started to show that the feat of sustaining accessible yet quality health care can indeed be accomplished.


Anisha Hegde is the Roosevelt Institute | Campus Network Senior Fellow for Health Care.


Please reload

Recent Posts
Please reload

Please reload

Search By Tags
Please reload

Follow Us
  • Facebook Basic Square
  • Twitter Basic Square
  • Google+ Basic Square