Hospital Observation or Admitted Status? Posted July 12, 2012 in Our articles

Have you heard? The discussion surrounding what happens when people go to the hospital and may spend a few hours, days or nights, occupy a bed, but come to find out they were never admitted, were instead designated as observation status? Regulatory criteria governing what conditions warrant an admission has changed. Patient admissions are being scrutinized to minimize waste and unwanted tests. Physicians are tasked with the decision to admit as an inpatient or maintain a patient on observation status depending on the clinical presentation and evaluation determining admission vs. observation. Medical tests and procedures can still be carried out although the patient is not admitted, and the hospital stay is defined as observation, an outpatient status.

Why does it matter? Admission vs. Observation status has financial implications, especially if you are a Medicare recipient. If not admitted, Medicare Part A will not cover your hospital bill, care will be billed under Medicare Part B which covers outpatient hospital services for which the patient will pay a co-pay. The risk is that the total copayment may exceed the deductible for Medicare Part A. (Note per Medicare guidelines: The copayment for a single outpatient hospital service can’t be more than the inpatient hospital deductible. However, your total copayment for all outpatient services may be more than the inpatient hospital deductible.)

What about rehabilitation? If post hospital inpatient rehabilitation is needed, in order for Medicare to pay for the allowable rehabilitation period, admission for three consecutive days to the hospital is required. If the patient is on observation or outpatient status, the rehabilitation stay may not be covered by Medicare.

What to do? Know your status, or the status of a loved one. Ask the Doctor or the admissions office to clarify the situation, or request to review the medical record. Knowing the status of admission enables informed decision making for planning and post hospital care. If you do not know how to ask or find out what you need to know, find an advocate, call a care manager. Information counts.

Review the Medicare Guidelines explaining Observation here.