HOSPITAL “OBSERVATION STATUS” REVISITED

ER Observation Revisited

Let me start by stating that recent laws have made some changes to this living nightmare, but the changes appear to be aesthetic only.

First, the rule:

Within 24-48 hours of entering the hospital, the doctor(s) must determine if you will be admitted as an inpatient (2 midnight rule);

  1. Once admitted as an inpatient, you must be an inpatient for three days (3 midnights) in order to qualify for medical coverage under Medicare Part A for any subsequent care such as Rehabilitation services in a skilled nursing facility (SNF);
  2. If you are admitted by the Doctor as an inpatient that determination is only prospective meaning from that day forward, not retroactive to the date you entered the hospital. Ironically, the hospital can retroactively undo the doctor’s inpatient finding retroactively making the patient an outpatient (observation status) right up until the patient leaves the hospital regardless of how long you have been there.
  3. Effective March 8, 2017, Hospitals are required to give observation patients a “Medicare Outpatient Observation Notice” (MOON) within 36 hours if the patient is in observation status for 24 hours or more.

Cause for concern:

  1. The doctors are not very good either in complying with the 24-48 hour rule or estimating the length of a patient’s anticipated stay;
  2. The MOON Notice has no appeal rights nor penalties associated with it so you have no recourse to challenge the decision;
  3. Even if your doctor does admit you as an inpatient, you could be there for a week (or longer) believing everything is all set for payment, but the hospital can retroactively change the patient back to outpatient and you are back to paying it out of pocket.

Some positive points:

  1. If you are in observation status, Medicare Part B may cover some of your expenses;
  2. Apparently many of the Medicare Advantage plans are waiving the three day inpatient care rule and are still covering the subsequent care.
  3. The Center for Medicare Advocacy is still trying to force changes in the law to at least allow appeal rights.

What should you do?

  1. Try and work with your doctors and explain your health history so they can make an informed decision;
  2. Contact your primary care doctor and ask him/her to advocate for you with the hospital doctors to be classified as inpatient;

For the patient’s subsequent care, consider Inpatient Rehabilitation Hospitals, Home Health or Outpatient Physical Therapy because they are not conditioned upon the three day stay and are paid for by Medicare Pt. B.

One Comment

  1. avatar paul beisler
    Posted June 9, 2017 at 4:18 pm | Permalink

    very informative thanks lou

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