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This cohort study examines the differences between 2 Centers for Medicare & Medicaid Services measures for 30-day rehospitalization after discharge from postacute inpatient rehabilitation., Key Points Question Can Centers for Medicare & Medicaid Services Quality Reporting Program measures detect variation in 30-day hospital readmission rates after postacute inpatient rehabilitation among US inpatient rehabilitation facilities (IRFs)? Findings In this cohort study of 454 378 Medicare fee-for-service beneficiaries discharged from 1162 IRFs submitting claims, risk-standardized potentially preventable readmission rates ranged from 4.3% to 7.3%. Application of the Potentially Preventable 30-Day Post-Discharge Readmission Measure for Inpatient Rehabilitation resulted in risk-standardized readmission rates above or below the national mean for less than 1% of 1162 Medicare-eligible IRFs. Meaning These findings suggest that the current readmission measure does not distinguish high- and low-performing facilities, and therefore it should not be implemented as part of the IRF quality reporting program., Importance The Improving Medicare Post-Acute Care Transformation Act of 2014 mandated a quality measure of potentially preventable 30-day hospital readmission for inpatient rehabilitation facilities (IRFs). Examining IRF performance nationally may help inform health care quality initiatives for Medicare beneficiaries. Objective To examine variation in Centers for Medicare & Medicaid Services Quality Reporting Program measures for US facility-level risk-adjusted all-cause and potentially preventable hospital readmission rates after inpatient rehabilitation. Design, Setting, and Participants This cohort study of Medicare claims data included 454 378 Medicare beneficiaries discharged from 1162 IRFs between June 1, 2013, and July 1, 2015. Data were analyzed March 23, 2018, through June 24, 2019. Main Outcomes and Measures All-Cause Unplanned Readmission Measure for 30 Days Post Discharge From Inpatient Rehabilitation Facilities and the Potentially Preventable 30-Day Post-Discharge Readmission Measure for Inpatient Rehabilitation. Specifications from the Centers for Medicare & Medicaid Services were followed to identify the cohort, define outcomes, and calculate risk-standardized facility-level rates. Results Among a cohort of 454 378 patients, the mean (SD) age was 76.2 (10.6) years and 263 546 (58.0%) were women. The all-cause readmission rate was 12.3% (95% CI, 12.2%-12.4%), and the potentially preventable readmission rate was 5.3% (95% CI, 5.3%-5.4%). Across 1162 included IRFs, risk-standardized all-cause readmission rates ranged from 10.1% (95% CI, 8.9%-11.6%) to 15.9% (95% CI, 13.6-18.6%) and potentially preventable readmission rates ranged from 4.3% (95% CI, 3.7%-5.4%) to 7.3% (95% CI, 5.7%-8.3%). Using the All-Cause Unplanned Readmission Measure for 30 Days Post Discharge From Inpatient Rehabilitation Facilities, 16 IRFs (1.4%) had 95% CIs above the national mean rate, 1137 IRFs (97.9%) had 95% CIs containing the national mean rate, and 9 IRFs (0.8%) had 95% CIs below the national mean rate. Using the Potentially Preventable 30-Day Post-Discharge Readmission Measure for Inpatient Rehabilitation, 8 IRFs (0.7%) had 95% CIs above the national mean rate, 1153 IRFs (99.2%) had 95% CIs containing the national mean rate, and 1 IRF (0.1%) had a 95% CI below the national mean rate. Conclusions and Relevance This cohort study found that readmission rates were lower when using the Potentially Preventable 30-Day Post-Discharge Readmission Measure for Inpatient Rehabilitation and further reduced discrimination between facilities compared with the recently discontinued All-Cause Unplanned Readmission Measure for 30 Days Post Discharge From Inpatient Rehabilitation Facilities. This finding may indicate there is a lack of room for improvement in readmission rates. Given the rationale of the Centers for Medicare & Medicaid Services for removing measures that fail to discriminate quality performance, this suggests that the current readmission measure should not be implemented as part of the Inpatient Rehabilitation Quality Reporting Program.