Medicare change tries to limit hospital visits

Phil Eklof
Phil Eklof
CBS News

(CBS News) A little known piece of the Affordable Care Act went into effect Monday. It is designed to lower the cost of Medicare to taxpayers.

Hospitals will now face big fines if too many of their patients have to be readmitted because of complications. One of every five Medicare patients ends up back in the hospital within 30 days of being released.

Roughly two-thirds of those receiving Medicare will forfeit money, up to one percent of a hospital's Medicare reimbursements.

Phil Eklof, 84, suffers from congestive heart failure and diabetes, and wound up in the hospital twice this year. He left with a laundry list of follow-up instructions and medications.

Eklof is fortunate. He has a home health care worker to help him.

"If you don't take a service like this you'll end up back in the hospital," Eklof said.

Federal officials are concerned that many Medicare patients nationwide fail to get the necessary follow-up care and many end up being re-admitted to the hospital, often in the same month.

The government is now penalizing hospitals for excessive readmissions in three areas: Patients recovering from heart failure, heart attacks or pneumonia. If a released patient comes back within 30 days, there's a one-percent penalty.

For example, if a hospital submits a $100,000 bill to Medicare, the penalty would reduce the reimbursement to $99,000.

In all, the penalized hospitals will forfeit about $290 million in Medicare funds over the next year.

Stephen Love, who heads the Dallas-Fort Worth Hospital Council, says the penalties are unfair to hospitals that serve primarily low-income populations.

"Hospitals that treat people in low-income areas in many cases don't have the primary care providers they need in their communities. They may not have pharmacies they need. So to coordinate that care outside the hospital is going to be very difficult," said Love, adding that much of the responsibility relies on patients themselves.

Not all hospitals are failing to meet these guidelines. Some hospital executive told CBS News the initiative is not all bad. In fact, some of those hospitals are developing their own programs to keep people healthier once they do get home and out of the hospital.