Including socioeconomic status reduces readmission penalties to safety-net hospitals.

Objective: Medicare's Hospital Readmissions Reduction Program (HRRP) financially penalizes "excessive" postoperative readmissions. Concerned with creating a double standard for institutions treating a high percentage of economically vulnerable patients, Medicare elected to exclude socioeconomic status (SES) from its risk-adjustment model. However, recent evidence suggests that safety-net hospitals (SNHs) caring for many low-SES patients are disproportionately penalized under the HRRP.