Reducing excess hospital readmissions has become a high policy priority to lower health care spending and improve quality. The Affordable Care Act (ACA) penalizes hospitals with higher-than-expected readmission rates. This study tracks patient-level admissions and readmissions to Florida hospitals from 2006 to 2014 to examine whether the ACA has reduced readmission effectively. We compare not only the change in readmissions in targeted conditions to that in non-targeted conditions, but also changes in sites of readmission over time and differences in outcomes based on destination of readmission. We find that the drop in readmissions is largely owing to the decline in readmissions to the original hospital where they received operations or treatments (i.e., the index hospital). Patients readmitted into a different hospital experienced longer hospital stays. The results suggest that the reduction in readmission is likely achieved via both quality improvement and strategic admission behavior.
Keywords: Index hospital; Medicare; Quality of care; Thirty-day readmissions.