Hospital Readmissions Reduction Program (HRRP)

The Hospital Readmissions Reduction Program (HRRP) is a Medicare value-based purchasing program that reduces payments to hospitals with excess readmissions. The program supports the national goal of improving healthcare for Americans by linking payment to the quality of hospital care.

Section 3025 of the Affordable Care Act requires the Secretary of the Department of Health and Human Services (HHS) to establish HRRP and reduce payments to Inpatient Prospective Payment System (IPPS) hospitals for excess readmissions beginning October 1, 2012 (i.e., Fiscal Year [FY] 2013). Additionally, the 21st Century Cures Act requires CMS to assess a hospital’s performance relative to other hospitals with a similar proportion of patients who are dually eligible for Medicare and full-benefit Medicaid beginning in FY 2019. The legislation requires estimated payments under the non-stratified methodology (i.e., FY 2013 to FY 2018) equal payments under the stratified methodology (i.e., FY 2019 and subsequent years) to maintain budget neutrality.

CMS includes the following six condition/procedure-specific 30-day risk-standardized unplanned readmission measures in the program:

    • Acute Myocardial Infarction (AMI)
    • Chronic Obstructive Pulmonary Disease (COPD)
    • Heart Failure (HF)
    • Pneumonia
    • Coronary Artery Bypass Graft (CABG) Surgery
    • Elective Primary Total Hip Arthroplasty and/or Total Knee Arthroplasty (THA/TKA)

For FY 2020, CMS calculates the payment adjustment factor and component results for each hospital based on their performance during the three-year performance period of July 1, 2015 through June 30, 2018. Payment reductions are applied to all Medicare fee-for-service (FFS) base operating diagnosis-related group (DRG) payments between October 1, 2019 through September 30, 2020. The payment reduction is capped at 3% (i.e., payment adjustment factor of 0.97).

CMS sends confidential Hospital-Specific Reports (HSRs) to hospitals annually. CMS gives hospitals 30 days to review their HRRP data, submit questions about the calculation of their results, and request calculation corrections. The Review and Corrections process for HRRP is specific only to discrepancies related to the calculation of the payment adjustment factor and component results.

Following the Review and Corrections period, CMS will publicly report hospitals’ HRRP data on Hospital Compare in early 2020.


For information on past program policies and supplemental data files, please follow the link below:

FY 2012 – FY 2019

For additional information on the readmission measures, please refer to the Related Links section below.

Supplemental data files from FY 2013 to FY 2019 are now available from the HRRP Archives page.

Page Last Modified:
02/11/2020 06:24 PM