Under the Medicare statute, an individual must have an inpatient stay in the hospital of at least three consecutive days, not counting the day of discharge, in order to meet Medicare criteria for coverage if the individual is thereafter transferred to a skilled nursing facility (SNF) for further assistance. Medicare beneficiaries are being denied access to Medicare coverage for SNF stays because of the growing use of “observation status” in the hospital setting.
Care received by individuals classified as being “in observation” status is often indistinguishable from care received by inpatients. But the designation of a patient as an outpatient (covered under Part B of Medicare) vs. an inpatient (covered under Part A) can result in beneficiaries being charged for some services received in the hospital that would otherwise be covered, including their prescription medications.
The primary motivation for hospitals’ increased use of observation status is the threat of punitive action by Recovery Auditors. These Medicare contractors review claims. If they reject a hospital’s admission of a patient as an inpatient, the hospital loses reimbursement for almost all related services.
The Centers for Medicare & Medicaid Services (CMS) have created a Self-Help Packet for individuals having problems because of being identified as under “observation status” when staying in the hospital. It is located at CMA’s website at www.medicareadvocacy.org. Type in “self-help-packet-for-medicare-observation-status” in the search area to obtain this packet.
Ms. MacDonald’s practice is limited to Estate Planning, Probate, Elder Law and Trust Administration. Ms. MacDonald maintains her practice in the Santa Clarita Valley at 25115 Avenue Stanford, Suite B-124, Valencia, California. She can be reached at 661-294-6464.