1. Early patient returns trigger fines up to $1 million for 7 metro Detroit hospitals Patricia Anstett Detroit Free Press August 27, 2012 http://www.freep.com/article/20120827/NEWS06/308270025/Early-patient-returns-trigger-fines-up-to-2-23-million-for-7-metro-Detroit-hospitals?odyssey=tab|topnews|text|FRONTPAGE

2. Penalties 7 metro Detroit hospitals are among 2,000 nationwide that will begin paying the biggest federal penalties -- some as much as $1 million - - because too many of their heart attack, heart failure and pneumonia patients needed to be readmitted within 30 days. Forty-seven other Michigan hospitals will pay smaller fines through a provision of President Barack Obama's Affordable Care Act that kicks in for the first time Oct. 1.

3. Readmission within 30 days The penalties address a well-known problem in health care: Far too many seniors, in particular, are readmitted within 30 days after they are released from a hospital. The federal Medicare program spends $17.5 billion a year for care for the 2 million Medicare beneficiaries who are readmitted within 30 days of their release from a hospital.

4. What do hospitals do? The St. Joseph Health System, parent company of St. Mary, credits lower readmissions its hospitals are seeing to units dating to 2007 that exclusively serve seniors who come to their emergency departments. Other hospitals, such as St. John, use nurses and others to "tighten all the loose ends for discharge" and follow up with care arrangements. “The biggest, most important thing that happens is communication,” said Dr. Kevin Grady, interim chief medical officer at St. John. If a person lives alone, doesn't have a car or telephone or other needs, the program helps find solutions so patients get the care they need, he said.

5. What is Quality? What is quality? –Something you (or an agent who represents you – in this case, Medicare) would pay more for. How do you get quality? –You have to pay more for it.

6. The Economics Look at a not-for- profit hospital. Quality costs more. Do people value it more? Demand Average Cost AC' D' Quantity Price ? ?