Medicare and Hospital Costs: Beware of Observation Status
Think you've been admitted to the hospital?
In our recent educational series on Medicare, we answered a lot of questions about the Medicare program, the various options for insurance coverage for retirees, some of the most common coverage misconceptions and Florida Medicare plans. One of the topics that most intrigued and surprised our audience was Medicare coverage of a hospital stay and follow up care. A phenomena that we are seeing more and more often is that patients are not being "admitted" but kept under "observation status", which means they are not considered inpatients at the hospital.
Why is this happening more? There are a number of factors causing this phenomena, including regulatory and payment issues. As Medicare (and private insurers) crack down on hospitals and providers for what might be considered unnecessary care, the providers are more cautious about each case and carefully looking at criteria for admission. There are several sets of criteria that doctors and providers use to analyze the medical necessity of an admission...all of which means little to the average elderly person or caregiver. What you probably think is..."well, I spent the night at the hospital so I was admitted" or "My Mom has been at the hospital a few days now and so this should be like any other hospital stay".
What's the difference between being admitted and being under observation? Being admitted to the hospital is not a matter of spending the night, getting a lot of tests and care, etc. A doctor has to write an order specifically admitting you as an inpatient, based on his or her analysis of medical necessity/use of standard criteria. How do you know if you or your loved one has been admitted? Ask your doctor or the hospital to confirm for you. As a caregiver and patient advocate, it is vital to ask a lot of questions and take good notes on the hospital stay anyway, and it can come in handy for billing issues as well. If you are not comfortable with what questions to ask or reviewing a medical chart, consider the value of a professional patient advocate.
What difference does it make? The main reason to know about your status at the hospital is the potential costs you will face. Here is Medicare's summary of what you will pay if you are not admitted to the hospital: "Medicare Part B covers outpatient hospital services. Generally, this means you pay a copayment for each individual outpatient hospital service. This amount may vary by service. Note: The copayment for a single outpatient hospital service can’t be more than the inpatient hospital deductible. However, your total copayment for all outpatient services may be more than the inpatient hospital deductible". As an inpatient, you are covered under Medicare Part A, which has a deductible of $1132 ($1156 in 2012) for any stay up to 60 days. In addition, for Medicare to cover inpatient rehabilitation/nursing care, a person must have a three-day qualifying hospital stay. If you are not admitted to the hospital, you will not qualify. Each day in inpatient rehabilitation can cost hundreds of dollars, so this care can be quite costly to pay out of pocket when you may need this follow-up care for recovery.
Click here for Medicare's overview of Hospital Inpatient vs. Outpatient Status.
Click here to read Aging Wisely's Medicare 2012 fact sheet, with all of the Medicare costs and important information about coverage.
Contact us today for information and assistance with Medicare analysis and consultation, patient advocacy and eldercare/geriatric care management services in Tampa Bay/Clearwater, Florida.