By Susan Jaffe KAISER HEALTH NEWS | September 11, 2014 | This KHN story also ran in ![]()
An increasing number of seniors who spend time in the hospital are surprised to learn that they were not “admitted” patients — even though they may have stayed overnight in a hospital bed and received treatment, diagnostic tests and drugs.
Because they were not considered sick enough to require admission but also were not healthy enough to go home, they were kept for observation care, a type of outpatient service. The distinction between inpatient status and outpatient status matters: Seniors must have three consecutive days as admitted patients to qualify for Medicare coverage for follow-up nursing home care, and no amount of observation time counts for that three-day tally. That leaves some observation patients with a tough choice: Pay the nursing home bill themselves — often tens of thousands of dollars – or go home without the care their doctor prescribed and recover as best they can.
But most observation patients with private health insurance don’t face such tough choices. Private insurance policies generally pay for nursing home coverage whether a patient had been admitted or not. Here’s a primer comparing how Medicare and private insurers handle observation care. [Continued in KHN] [Continued in Washington Post]



The federal government may be paying hospitals $5 billion too much as a result of an 18-month moratorium on enforcement of Medicare rules that tell hospitals when patients should be admitted, an independent Medicare auditing company told a congressional panel yesterday. The controversial rules were intended to reduce the increasing number of seniors hospitalized for observation but not admitted. If they have not been admitted to the hospital for at least three consecutive days, they are not eligible for follow-up nursing home coverage and may have higher out-of-pocket expenses while in the hospital. Medicare pays hospitals more for admitted patients than observation patients. MORE from
which requires members to get treatment only from a network of health care providers. They cannot change plans during the year if their doctor leaves their network….
“It has been standard operating procedure that patients will be discontinued from therapy services because they are not improving,” she said.
