Information About ACA Hospital Discharges and Readmissions

The Affordable Care Act changed the laws around hospital readmission policies and, therefore how you are discharged after a hospital visit. Before these laws were enacted, a typical hospital visit might have gone like this: Today is the day for your scheduled surgery. You arrive at the hospital at the appointed hour, take care of all the processing and paperwork, get settled in your room, are wheeled to your surgery, come to a few hours later, and the nurse says, "as soon as you have a bowel movement, we are sending you home."

A man and his doctor talking in a hospital room

Kupicoo / Getty Images

Never mind that you now have a many-stitched hole across your abdomen (down your leg, across your shoulder, etc). Your pain level is through the roof, and you feel like you've been hit by a semi-truck. You can't imagine what they can be thinking to want to send you home so quickly.

There are a number of reasons the hospital might want you to leave so soon after your surgery. They are similar to the reasons they want to discharge patients quickly no matter what reason they were admitted. That is, at some point they can no longer make enough money to make it worth their while to keep you there.

Reasons Why a Hospital Would Want to Discharge You

Here are some of the reasons they want to dismiss you sooner rather than later:

  • Insurance and Medicare have guidelines on how much hospitalization they are willing to pay for relating to every diagnosis and treatment plan (called ICDs) you might be admitted for. Once you get past that deadline, the hospital may no longer be reimbursed for your stay unless some other problem has cropped up which they can bill and be reimbursed for instead.
  • If you are a Medicare patient and are at any risk for acquiring an infection, whether it's from surgery, or because you have compromised immunity to infections, the hospital wants you to leave before that infection begins to show up. That's because if you acquire a preventable condition while in the hospital (called a never event, or a serious reportable event), and it's the hospital's fault you acquired it, then Medicare will not reimburse the hospital for the care they must provide you during your extended stay. Therefore, logically, the sooner you are discharged, the less chance any infections will appear, or preventable events can occur while you're still there.

The second reason also illustrates the law of unintended consequences or Newton's Law of Healthcare Motion. When hospitals were alerted in 2010 that they would begin losing reimbursements if their patients suffered preventable errors, they began discharging patients far earlier than many patients were ready for.

Consequences of an Early Discharge

Here's what happened next: patients would get home, or would be discharged to a nursing home or rehab center, only to find major problems with their ability to heal, including the discovery that they had an infection, or didn't have the right instructions, or the where-with-all, to manage their recovery. So they would return to the hospital to be readmitted, in which case the hospital could begin making money from them again because the problem they were admitted for never showed up until after they left the hospital the first time. Being back in the hospital was good for patients, and since it could get reimbursed, it was good for the hospital, too. (Never mind the additional stress and slowed healing caused by moving the patient from here to there and back again as she was discharged the first time.)

It didn't take long for Medicare to figure out what the hospitals were doing, and how much it was costing the system. So as a part of the Affordable Care Act (ObamaCare, also called the ACA), yet another new regulation was included. That is, that if a hospital readmits a Medicare patient within 30 days after discharge, it will be penalized through lower reimbursement. In 2012, more than 2,000 hospitals were penalized.

What to Expect From the ACA's Hospital Readmission Policies

If you are hospitalized, you may see a number of changes, some good and some problematic.

First, you will begin to see a higher level of more effective communications from hospital staff because they know you will be formally judging them through patient satisfaction surveys, you will also begin to see more effective discharge planning. You'll probably be given plenty of reading material, you may be asked to watch videos about how to take care of yourself after discharge, and you may even get a phone call once you are home (or in the rehab center) checking up on you. These are all attempts at good customer service and are definitely a benefit to you.

However, we may also begin to see some other unintended consequences work their way across the system. In mid-2012, a new (and easily considered unethical) approach to making more money was uncovered when it was discovered that hospitals could make more money if they treated patients, even over the span of several days or weeks, without ever admitting them. In particular, Medicare patients are being kept in "unreimbursable observation status" which, for many, means they will have to pay out of their own pockets for care.

The goal of regulating how hospitals are reimbursed for patients is to eliminate overbilling and fraud, big keys for the success of the ACA. Making sure those regulations don't trickle down to additional problems for patients will require smart patients to step up when they see problems that result.

Can You Fight the Discharge?

Yes, you most certainly can. If you or your loved one realizes that it would be much smarter for you to stay in the hospital, you can appeal the decision to make you leave.

6 Sources
Verywell Health uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. The Commonwealth Fund. ACA at 10 Years: What's Changed.

  2. Centers for Medicare and Medicaid Services. Health Care Code Sets: ICD-10.

  3. Centers for Medicaid and Medicare Services. Eliminating Serious, Preventable, and Costly Medical Errors - Never Events.

  4. Department of Health and Human Services Office of the Inspector General. Adverse Events in Hospitals: National Incidence Among Medicare Beneficiaries.

  5. Kaiser Family Foundation. Medicare to Penalize 2,217 Hospitals for Excess Readmissions.

  6. Center for Medicare Advocacy. Observation Status: Mixed Messages from Federal Government as Beneficiaires Continue to be Hurt.

By Trisha Torrey
 Trisha Torrey is a patient empowerment and advocacy consultant. She has written several books about patient advocacy and how to best navigate the healthcare system.