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  • Observation Status Can Leave Patients With Out of Pocket Expenses

    February 13, 2014

    When hospitals admit patients under an observation stay rather than on an inpatient basis, patients may unknowingly have to pay out of pocket for necessary follow-up skilled nursing care. The admission distinction is important because Medicare covers subsequent nursing and rehabilitation only if a patient has stayed in a hospital for at least three consecutive nights as an inpatient.

    The observation vs. inpatient designation has been an issue for several years, reports The Columbus Dispatch . Hospitals are encouraged to reduce expensive short-term stays. Plus, if a patient who receives observation care returns to the hospital within 30 days, the repeat visit does not count as an actual readmission that subjects the hospital to a potential penalty.

    Medicare held an "open door" conference call last week with hospitals and doctors to address the admission issue, and lawmakers are trying to pass legislation that would limit the use of "observation days" because of the financial consequences it can have for thousands of patients. The most recent bill, introduced by Rep. Tom Latham, R-Iowa and primary sponsor Rep. Joe Courtney, D-Conn., proposes counting observation stays toward the three-night rule and has 162 co-sponsors in Congress, according to Live Well Nebraska.

    RehabCare will continue to closely follow this story as it develops.

    Barbara McCann Permalink
    September 29, 2015 9:23 AM

    My husband went to a Barnes-Jewish hospital in Missouri with heart attack symptoms. He went from the ER into a hospital room and spent the night. Many tests including EKG's were run and the following morning - right before his radiological heart test we were told be had not been admitted and was considered under observation. Shortly before the 24hour mark - he was released. Now we have no idea of what the cost for the services will be and the hospital refused to classify him as in-patient. My husband has stated that he will not go to the hospital if there is anything wrong again! What purpose does this serve. Now people are afraid to go to the hospital because of the cost!

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