Putting Seniors In The Hospital Under 'Observation' May Cost Them Thousands

Many seniors think Medicare made a mistake when they find out they were never officially admitted to the hospital despite a several-day stay.

NPR: For Hospital Patients, Observation Status Can Prove Costly
Increasingly, hospitals are placing older patients on "observation status". They may be there for days, but technically they're still outpatients. This is a big deal for someone on Medicare because followup treatment in a nursing home isn't covered unless someone has been an inpatient for at least three days. That's leaving some seniors on the hook for thousands of dollars in nursing home bills (Jaffe, 9/4).

Kaiser Health News: FAQ: Hospital Observation Care Can Be Poorly Understood And Costly For Medicare Beneficiaries
[A] recent government investigation found that observation patients often have the same health problems as those who are admitted. ... The number rose 69 percent in five years, to 1.6 million nationally in 2011, according to the most recent federal statistics. At the same time, Medicare hospital admissions have declined slightly. Here are some common questions and answers about observation care and the coverage gap that can result (Jaffe, 9/4).

Boston Globe: Ex-Medicare Chief Urges Fix To Rule For Rehab Coverage
Former Medicare chief Donald Berwick said Obama administration officials should abandon a rule that is leaving many older Americans without coverage for expensive rehabilitation care after they leave the hospital. ... Berwick said that when he ran Medicare from July 2010 to December 2011, he discussed scrapping the three-day rule. But others in the agency worried that without this requirement, people would emerge from “the woodwork’’ to check into nursing homes without any review of whether they really need to be there (Kowalczyk, 8/30).

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