The Centers for Medicare & Medicaid Services wants to adjust penalties in its Hospital Readmissions Reduction Program according to a hospital’s proportion of dual-eligible (Medicare and Medicaid) patients — a move long supported by hospital-industry stakeholders.

The proposed rule would take effect in fiscal 2019. In it, the CMS laid out several approaches  for determining   hospitals’ proportion of dually eligible patients and other key metrics.The change stems from the 21st Century Cures Act,  enacted last December. The law required Medicare to consider patient background when calculating payment reductions to hospitals under the Hospital Readmission Reduction Program, and to adjust those penalties based on the proportion of patients  dually eligible for Medicare and Medicaid.

The  Medicare Payment Advisory Commission has reported that while these dual eligibles constituted 18 percent of beneficiaries they accounted for nearly a third of total Medicare fee-for-service spending in 2012.

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