Tuesday, June 30, 2015

Costly difference for you between being admitted or under outpatient observation care

Warning:  There is a really BIG difference between being classified as an admitted patient vs observation care when you're in the hospital. ‘Observation status’ changes what Medicare pays for as well as qualifying you for rehab care.

Over the past few years, some hospitals have increasingly classified the status of Medicare beneficiaries as out-patient observation instead of admitted patients. This classification dramatically reduces Medicare’s contribution to your cost of a hospital stay and any follow-up care in a skilled nursing facility.

Medicare considers hospital observation an outpatient service. Current Medicare law requires a patient to be admitted to the hospital as an inpatient for a minimum of three days in order to receive coverage for follow-up care in a skilled nursing facility. After that, Medicare pays for the first 20 days of skilled care at 100%. Should a patient be under observation for all or part of his hospital stay, he will be responsible for the entire cost of rehab.

Observation patients may also be charged co-payments for their doctors’ fees and other hospital services including X-rays, drugs and lab tests.

How to Avoid “Observation” Status

The problem is that you may not know whether you are receiving observation care or have been admitted as a patient unless you ask so it’s up to you to take the following steps:

1.     Ask about your status when you are admitted and each day that you are in the hospital. Your status can be changed from inpatient to observation or back again.

2.    Ask your doctor if observation status is justified for your medical condition. If not, ask your doctor to contact the hospital to request that you be admitted as an inpatient.

3.     After discharge, if you find out Medicare won't cover your stay in a skilled nursing facility, ask your doctor whether you qualify for similar care at home through Medicare's home health care benefit.

4.    If you have to pay for services at a skilled nursing facility, but you believe those services should have been billed as inpatient, you can try formally appealing Medicare's decision.

If you have a Medicare Advantage Plan, costs and coverage may be different. Always check with your agent or plan provider.  My clients can always call me if they have questions at 440-255-5700 about these or other issues concerning their insurance coverage.

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