Medicare Watch

Your Weekly Medicare Consumer Advocacy Update

How Does Hospital Outpatient Usage Impact Medicare Readmission Rate?

May 1, 2014

New CMS Report Analyzes How Change in Usage of Hospital Outpatient Services Impacts Medicare Readmission Rate

This week, the Centers for Medicare & Medicaid Services Office of Information Products and Data Analytics released a report that looks at how the change in usage of hospital outpatient services, such as emergency room visits and observation stays, impacts inpatient hospital readmission rates among beneficiaries with traditional fee-for-service Medicare. Using all claims in the Chronic Condition Data Warehouse from 2007 through 2012, CMS analyzed the national growth in annual readmission stays and compared that to hospital outpatient services that did not then involve an inpatient visit.

According to the report, readmission stays are defined by an inpatient hospital stay that began within 30 days of discharge from a previous inpatient stay. In 2012, the hospital readmission rate among beneficiaries with traditional Medicare was 18.5 percent—down from 19 percent in 2011. The number of index admission stays (inpatient hospital stays not including stays where the patient died) per-1,000 Medicare beneficiaries decreased by 4.3 percent, from 283.4 stays in 2011 to 271.3 stays in 2012, and the number of readmission stays per-1,000 Medicare beneficiaries decreased by 6.8 percent over the same time period. Meanwhile, the number of emergency room visits occurring within 30 days of an inpatient visit per Medicare beneficiary remained steady at 23.5 visits in 2011 and 23.4 visits in 2012. The number of observation stays occurring within 30 days of an inpatient stay per-1,000 Medicare beneficiaries increased from 3.4 visits in 2011 to 3.7 visits in 2012—following a similar rate of increase over the five previous years.

According to the report, this data suggests that the overall reduction in Medicare readmission rates in 2012 were not primarily the result of increased use of outpatient emergency room visits or observation stays. Ultimately, the report states that the reasons for the decline in the Medicare readmission rate in 2012 are not clear, but may be attributed to improvement in the quality of care for people with Medicare. Preliminary unpublished data for 2013 shows a continued overall reduction in readmission rates. The report recommends further study of this and future data in order to reach a comprehensive explanation for the decrease in Medicare readmission rates.

Read CMS’ report.

Volume 5, Issue 17

Medicare Interactive logo

Medicare Reminder

Medicare covers therapy services that help you maintain your ability to function, prevent you from getting worse, or slow worsening symptoms. As long as you meet the following requirements, Medicare should cover your outpatient therapy whether or not your condition is temporary or chronic:

  1. You need the technical skills of a trained therapist to provide safe and effective treatment;
  2. Your doctor or therapist sets up the plan of treatment before you get care; and
  3. Your doctor regularly reviews the plan of treatment to see if changes are needed.

If you have Original Medicare, Medicare Part B generally covers 80 percent of the cost of each outpatient therapy service and you or your supplemental insurance is responsible for the remaining 20 percent. In 2014, there is a $1,900 therapy cap for physical and speech therapy combined and a separate $1,900 cap for occupational therapy. However, you may be able to continue receiving therapy past the cap if it is medically necessary. If you have a Medicare Advantage plan, it can set its own cost rules for physical, occupational, and speech therapy.

Click here to learn more about physical, occupational and speech therapy coverage on Medicare Interactive.



According to a recent blog post by Kevin Prindiville, Executive Director of The National Senior Citizens Law Center, the recent budget released by Congressman Paul Ryan and passed by the House of Representative would have a considerable impact on the nation’s older adult population. A few of the harmful provisions include:

  • Cutting the Supplemental Security Income(SSI) program by $5 billion
  • Cutting Medicaid by $732 billion
  • Eliminating provisions of the Affordable Care Act that help low-income seniors stay in their homes, access preventive care, get improved chronic care, and reduce the cost of the prescription drugs.

Ultimately, this budget “leaves the country’s older adults to struggle with less food, income, housing and care,” said Prindiville.

Click here to read the blog post.

Click here to sign Medicare Rights’ petition saying NO to the Ryan budget.


Stay up-to-date on Medicare policy and advocacy developments, and learn about changes in Medicare benefits and rules with this weekly newsletter.

* * * *

Health Care Professionals:

Need to stay current on all things Medicare? Try a subscription to Medicare Rights University. This comprehensive training solution features traditional, webinar and video courses to help you train new staff and keep existing staff up to speed on Medicare changes, benefits and options.

Subscribe today at

* * * *

Get answers to your Medicare questions from Medicare Interactive at

© 2014 by Medicare Rights Center. All rights reserved.

For reprint rights, please contact Mitchell Clark.