Concerns raised about effect of Medicare's readmission penalty on hospitals

The New York Times explores the new policy that penalizes hospitals if they have too many patients return within 30 days. Meanwhile, in Maryland, officials are weighing an ambitious plan to control hospital costs.

The New York Times: Hospitals Question Medicare Rules On Readmissions
While federal statistics show the effort is beginning to reduce costly and unnecessary readmissions, a growing chorus of critics is asking whether the government policy, which penalizes hospitals that have high readmission rates, is unfair. They are also questioning whether hospitals should be responsible for managing the personal lives of patients once they are released -; or whether they should focus on other ways to improve care (Abelson, 3/29).

Kaiser Health News: Maryland's Tough New Hospital Spending Proposal Seen As 'Nationally Significant'
Maryland officials have proposed what analysts call the most ambitious initiative in the country to control soaring medical spending, a plan that would bring relief to employers and consumers footing the bill while bluntly challenging the state's powerful hospital industry. The blueprint, which needs the Obama administration's approval, would use Maryland's unique rate-setting system to keep hospital spending from growing no faster than the overall economy -; roughly half its recent rate of increase (Hancock, 4/1).

In other health industry news, a federal watchdog focuses on Medicare spending for equipment.

Kaiser Health News: Capsules: IG Report Slaps Medicare For Not Recouping More Overpayment For Equipment
Medicare has made nearly $70 million in overpayments to suppliers of consumer medical equipment and more than half of that money is unlikely to be recovered, according to a new report from the Department of Health and Human Services Inspector General (Carey, 4/1).