Importance: Hospitals that serve poorer populations have higher readmission rates. It is unknown whether these hospitals effectively lowered readmission rates in response to the Hospital Readmissions Reduction Program (HRRP). Objective: To compare pre-post differences in readmission rates among hospitals with different proportion of dual-eligible patients both generally and among the most highly penalized (ie, low performing) hospitals. Design: Retrospective cohort study using piecewise linear model with estimated hospital-level risk-standardized readmission rates (RSRRs) as the dependent variable and a change point at HRRP passage (2010). Economic burden was assessed by proportion of dual-eligibles served. Setting: Acute care hospitals within the United States. Participants: Medicare fee-for-service beneficiaries aged 65 years or older discharged alive from January 1, 2003 to November 30, 2014 with a principal discharge diagnosis of acute myocardial infarction (AMI), congestive heart failure (CHF), and pneumonia. Main Outcome and Measure: Decrease in hospital-level RSRRs in the post-law period, after controlling for the pre-law trend. Results: For AMI, the pre-post difference between hospitals that service high and low proportion of dual-eligibles was not significant (-65 vs. -64 risk-standardized readmissions per 10000 discharges per year, P=0.0678). For CHF, RSRRs declined more at high than low dual-eligible hospitals (-79 vs. -75 risk-standardized readmissions per 10000 discharges per year, P=0.0006). For pneumonia, RSRRs declined less at high than low dual-eligible hospitals (-44 vs. -47 risk-standardized readmissions per 10000 discharges per year, P=0.0003). Among the 742 highest penalized hospitals and all conditions, the pre-post decline in rate of change of RSRRs was less for high dual-eligible hospitals than low dual-eligible hospitals (-68 vs. -74 risk-standardized readmissions per 10000 discharges per year for AMI, -88 vs. -97 for CHF, and -47 vs. -56 for pneumonia, P<0.0001 for all). Conclusions and Relevance: For all hospitals, differences in pre-post trends in RSRRs varied with disease conditions. However, for the highest-penalized hospitals, the pre-post decline in RSRRs was greater for low than high dual-eligible hospitals for all penalized conditions. These results suggest that high penalty, high dual-eligible hospitals may be less able to improve performance on readmission metrics.