<p><strong>BACKGROUND AND OBJECTIVE: </strong>Like their adult counterparts, pediatric hospitals are increasingly at risk for financial penalties based on readmissions. Limited information is available on how the composition of a hospital's patient population affects performance on this metric and hence affects reimbursement for hospitals providing pediatric care. We sought to determine whether applying different readmission metrics differentially affects hospital performance based on the characteristics of patients a hospital serves.</p>
<p><strong>METHODS: </strong>We performed a cross-sectional analysis of 64 children's hospitals from the Children's Hospital Association Case Mix Comparative Database 2012 and 2013. We calculated 30-day observed-to-expected readmission ratios by using both all-cause (AC) and Potentially Preventable Readmissions (PPR) metrics. We examined the association between observed-to-expected rates and hospital characteristics by using multivariable linear regression.</p>
<p><strong>RESULTS: </strong>We examined a total of 1 416 716 hospitalizations. The mean AC 30-day readmission rate was 11.3% (range 4.3%-19.6%); the mean PPR rate was 4.9% (range 2.9%-6.9%). The average 30-day AC observed-to-expected ratio was 0.96 (range 0.63-1.23), compared with 0.95 (range 0.65-1.23) for PPR; 59% of hospitals performed better than expected on both measures. Hospitals with higher volumes, lower percentages of infants, and higher percentage of patients with low income performed worse than expected on PPR.</p>
<p><strong>CONCLUSIONS: </strong>High-volume hospitals, those that serve fewer infants, and those with a high percentage of patients from low-income neighborhoods have higher than expected PPR rates and are at higher risk of reimbursement penalties.</p>
<p><strong>BACKGROUND AND OBJECTIVE: </strong>Observation status, in contrast to inpatient status, is a billing designation for hospital payment. Observation-status stays are presumed to be shorter and less resource-intensive, but utilization for pediatric observation-status stays has not been studied. The goal of this study was to describe resource utilization characteristics for patients in observation and inpatient status in a national cohort of hospitalized children in the Pediatric Health Information System.</p>
<p><strong>METHODS: </strong>This study was a retrospective cohort from 2010 of observation- and inpatient-status stays of ≤2 days; all children were admitted from the emergency department. Costs were analyzed and described. Comparison between costs adjusting for age, severity, and length of stay were conducted by using random-effect mixed models to account for clustering of patients within hospitals.</p>
<p><strong>RESULTS: </strong>Observation status was assigned to 67 230 (33.3%) discharges, but its use varied across hospitals (2%-45%). Observation-status stays had total median costs of $2559, including room costs and $678 excluding room costs. Twenty-five diagnoses accounted for 74% of stays in observation status, 4 of which were used for detailed analyses: asthma (n = 6352), viral gastroenteritis (n = 4043), bronchiolitis (n = 3537), and seizure (n = 3289). On average, after risk adjustment, observation-status stays cost $260 less than inpatient-status stays for these select 4 diagnoses. Large overlaps in costs were demonstrated for both types of stay.</p>
<p><strong>CONCLUSIONS: </strong>Variability in use of observation status with large overlap in costs and potential lower reimbursement compared with inpatient status calls into question the utility of segmenting patients according to billing status and highlights a financial risk for institutions with a high volume of pediatric patients in observation status.</p>
<p><strong>OBJECTIVE: </strong>To assess readmission rates identified by 3M-Potentially Preventable Readmissions software (3M-PPRs) in a national cohort of children's hospitals.</p>
<p><strong>STUDY DESIGN: </strong>A total of 1 719 617 hospitalizations for 1 531 828 unique patients in 58 children's hospitals from 2009 to 2011 from the Children's Hospital Association Case-Mix Comparative database were examined. Main outcome measures included rates, diagnoses, and costs of potentially preventable readmissions (PPRs) and all-cause readmissions.</p>
<p><strong>RESULTS: </strong>The 7-, 15-, and 30-day rates by 3M-PPRs were 2.5%, 4.1%, and 6.2%, respectively. Corresponding all-cause readmission rates were 5.0%, 8.7%, and 13.3%. At 30 days, 60.6% of all-cause readmissions were considered nonpreventable by 3M-PPRs, more than one-half of which were related to malignancies. The percentage of readmissions rated as potentially preventable was similar at all 3 time intervals. Readmissions after chemotherapy, acute leukemia, and cystic fibrosis were all considered nonpreventable, and at least 80% of readmissions after index admissions for sickle cell crisis, bronchiolitis, ventricular shunt procedures, asthma, and appendectomy were designated potentially preventable. Total costs for all readmissions were $1.7 billion; PPRs accounted for 27.3% of these costs. The most costly readmissions were associated with ventricular shunt procedures ($26.5 million/year), seizures ($15.5 million/year), and sickle cell crisis ($15.0 million/year).</p>
<p><strong>CONCLUSIONS: </strong>Rates of PPRs were significantly lower than all-cause readmission rates more than one-half of which were caused by exclusion of malignancies. Annual costs of PPRs, although significant in the aggregate, appear to represent a much smaller cost-savings opportunity for children than for adults. Our study may help guide children's hospitals to focus readmission reduction strategies on areas where the financial vulnerability is greatest based on 3M-PPRs.</p>