New Medicare Rule – Seniors Beware
Feb 06, 2014
Medicare is ready to enforce a new rule April1, 2014 requiring doctors to admit people they expect to stay more than two midnights, and to classify anyone else as an observation patient. That Medicare classification, of observation status, can cost seniors thousands of extra dollars if they need post-hospital nursing care. For seniors vulnerable to the observation status problem, the stakes are high.
The Centers for Medicare & Medicaid Services, (CMS), devised this policy as a fix for a sharp rise in extended hospital stays billed as outpatient observation, a trend attributed in part to hospital’ efforts to avoid having their admission decisions challenged by government auditors.
When a patient who meets Medicare’s three-day formula admission requirement moves to a skilled nursing facility, the program covers 100% of the first 20 days. Patients leaving the hospital for a nursing facility after an observation stay pay the full cost out of pocket.
As a result, patients are leaving the hospital against medical advice and foregoing diagnostic tests and medications. Physician-patient relationships are being strained because patients think doctors can admit them when they are really bound by Medicare’s rules.
It is difficult for seniors to protect themselves against this risk. Hospitals are not required to notify patients they are on observation status and it is hardly something families would check during a health crisis. It does not make any sense that a patient spending multiple days in the hospital has not been admitted.
There is currently legislation being pushed that would delay enforcement of the two-midnight policy until October 1, 2014. This bill will provide additional time to get the education out to clinicians and patients so they understand what the rule means and how to operate within it.
Seniors or their families should ask their doctors about admission status. If they find they are on observation status, they should do what they can to get it changed at the time.
As of January 31, 2014, the Center for Medicare and Medicaid Services, (CMS), has delayed enforcement of this rule until October 1, 2014.
By: Diane Allman, CPA
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