MELISSA BLOCK, HOST:

This is ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

LYNN NEARY, HOST:

And I'm Lynn Neary. Millions of Americans are discharged from hospitals each year, only to return within 30 days. As many as three-quarters of those patients had problems that could have been prevented.

The 2010 health law is designed to discourage these so-called readmissions and a new study says government policy needs to focus even more on reducing the financial incentives to readmit patients.

Fred Mogul from member station WNYC reports.

MARY MCDONAGH: Your blood pressure is pretty good.

FRED MOGUL, BYLINE: Fifty-three year old Joseuly Claudio comes to see nurse practitioner Mary McDonagh about twice a week.

MCDONAGH: We'll check and see how your lungs are.

MOGUL: Claudio has congestive heart failure, basically a very, very weak heart, plus diabetes, hypertension and severe gastroparesis, a stomach problem that makes him gag constantly.

JOSEULY CLAUDIO: Sometimes, I dehydrate and I don't know which one it is, so I don't know if it's my blood glucose or my high blood pressure, low blood pressure.

MOGUL: Claudio is at a clinic at Mount Sinai Hospital in Manhattan operated by its Preventable Admission Care Team, or PACT. PACT tries to make Mount Sinai's unhealthiest Medicare patients more self-sufficient.

Claudio's been coming to the PACT clinic for more than a year, but Nurse McDonagh says he still needs to be treated with kid gloves.

MCDONAGH: We don't want to put him into pulmonary edema and we want him to know he can come here rather than the emergency room when he doesn't feel well.

MOGUL: Starting next fall as part of President Obama's health care overhaul, Washington will cut hospitals' Medicare payments by one percent if too many discharged patients are back in an overnight bed within 30 days.

Mount Sinai Hospital administrator Claudia Colgan says getting readmissions down is a top priority and it'll take a major culture shift.

CLAUDIA COLGAN: If you are the doctor that's on call and a patient that you have never met before calls and says I have these symptoms, the likelihood is you're going to say, you know what? Go to the emergency room. And what we've really tried to do is not have that happen.

MOGUL: Historically, readmissions have been very, very good to Mount Sinai and to many hospitals. Sure, paying for avoidable care is bad if you're the government or a private insurance company writing the checks for hospital care, but if you're the one being paid - well, repeat customers like Claudio are money in the bank, according to Dr. Eric Coleman from the University of Colorado.

DR. ERIC COLEMAN: There are conflicting incentives when it comes to this problem of hospital readmission. Depending on what part of the country you're in, a hospital might rely on readmissions accounting for anywhere from 15 to 25 percent of their revenue.

MOGUL: Medicare is initially focusing its hospital penalties on readmission rates for three conditions: congestive heart failure, heart attacks and pneumonia. But Dr. Ashish Jha, in the latest New England Journal of Medicine, argues readmissions aren't the best indicator of unnecessary care, even though they're an easy target for budget cutters.

The Harvard University professor says many of the hospitals with the highest readmission rates also serve the poorest areas with the biggest health problems.

ASHISH JHA: Readmissions are caused by what hospitals do, who the patients are, what's happening in the community and you want hospitals to fix the things that they can, but you don't want to punish them for taking care of poor people and you don't want to punish them for being located in a poor area.

MCDONAGH: So we've got good (unintelligible). No dehydration.

MOGUL: Back at Mount Sinai, there are some signs the PACT program is paying off. In the program's first full year, its 500 patients have had a 40 percent drop in readmissions. Patient Joseuly Claudio says one recent evening when he was feeling dehydrated, he didn't dial 911 as he might have a year ago. He's learned to gauge his symptoms better, so he went to sleep and waited for the PACT clinic to open on Monday.

CLAUDIO: I feel more at ease because I have them. I try not to panic, and if it gets worse, I'll call them and they will tell me to come here. Maybe I just need the fluids so I don't have to go to the emergency room.

MOGUL: But Mount Sinai is absorbing almost all of the cost of his twice-a-week clinic visits and it's not clear how long the hospital can foot the bill, especially if it turns out to be cheaper just to pay the federal penalty.

For NPR News, I'm Fred Mogul in New York.

NEARY: This story is part of a reporting partnership between WNYC, NPR and Kaiser Health News.

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