Hospitals will be fined for emergency readmissions in 2012-13 even if they can prove that they are not responsible for them, according to rules published by the Department of Health this afternoon.

The government last year introduced controversial rules requiring commissioners to withhold payment from hospitals for emergency readmissions within 30 days of the patient’s previous discharge.

The policy was deeply disliked by acute providers, which argued that many readmissions were due to factors beyond their control. In response, the DH today published new rules, which will require all commissioners to conduct clinical reviews with their providers, to determine what proportion of readmissions are actually avoidable.

However, the new rules will explicitly require commissioners to fine hospitals for readmissions caused by shortcomings in community or social services.

“The threshold for non-payment needs to include those admissions which are preventable through actions in the community so that a fund is established to tackle those issues and prevent patients being admitted to hospital unnecessarily,” the guidance states.

Examples given of ways this fund could be used include prevention of dehydration in nursing homes, provision of intravenous antibiotics at home, and improved response times for referrals to district nursing.

An HSJ investigation last summer revealed major failings in the way the readmissions policy was applied this year. There was wide variation across England in the proportion of readmissions going unpaid, and a large part of the fines collected was apparently not being reinvested to prevent further readmissions.

The DH guidance published today acknowledged many of these issues, stating: “After engaging with NHS colleagues and reviewing the impact of the policy in Quarter 1, we understand that the application of the policy has proved very difficult to operate locally from the perspective of both commissioners and providers.

“Nationally this has resulted in an unacceptable level of variation on how the policy has been implemented. There are also concerns about the management of the savings generated by the policy with a significant amount either not being reinvested or not being reinvested in an agreed, transparent way.”

The reinvestment rules for 2012-13 state: “To ensure transparency within the system, commissioners need to discuss with providers where this money will be reinvested. Commissioners will be required to provide data on savings through the Financial Information Management System (FIMS) return and should ensure that they can provide a full audit trail of how the money is being used to prevent readmissions from occurring.”

All funds must be invested in “post discharge reablement services which support rehabilitation, reablement and the prevention of readmission, and particularly into those areas suggested by the clinical reviews”.

The Foundation Trust Network said that even though providers would be fined for readmissions that were not their fault it was “a step forward that providers will be consulted about how the money withheld from acute trusts will be invested in community services”.

FTN chief executive Sue Slipman said: “We would like to see a thorough review of the policy on re-admissions later in the year, to ensure that avoidable re-admissions are actually being reduced and acute trusts are not being fined for outcomes beyond their control.

“It is clear that providers and commissioners of NHS services have to work together to ensure that there are sufficient resources in the community to deliver care outside of hospitals. This guidance also strengthens the requirement on commissioners to be transparent in how they to achieve this.”