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Know Your Rights! - The Low-Down on Medicare's Coverage of Hospital Stays

Shannon Martin - June 18, 2012 11:45 AM

The Medicare program consists of a variety of parts, covering different services such as medications, hospitalizations and tests.  Medicare Part A generally covers hospital stays and inpatient rehabilitation services, whereas Part B covers doctors and other outpatient types of services. 

When elders are hospitalized, they will generally be subject to a flat deductible (for stays up to 60 days) under Part A.  For 2012, the Part A deductible for up to a 60 day hospital stay is $1156 (many individuals have supplemental insurance which is designed to help pay for such co-pays and deductibles).  For all the deductible and copay costs under Medicare, Aging Wisely offers a Medicare Fact sheet you can download.  Doctors’ services received while in the hospital are generally billed under Part B.

One of the emerging issues for Medicare recipients who go to the hospital is the distinction between Hospital Observation Services vs. Hospital Admission under Medicare.  Staying overnight in the hospital does not necessarily tell you that someone has been admitted.  If a patient is not admitted but is being categorized as receiving “observation services” then he or she is considered an outpatient, even if there for several days.  The doctor makes this determination, but a hospital utilization review can change the patient’s status.  Medicare’s statutes do not define observation status but most hospitals use common decision-making criteria such as McKesson’s Interqual criteria.  For a variety of reasons, including Medicare’s increasing reviews of hospital admissions, patients are more often being categorized as “observation status” (and for increasing lengths of time).

What difference does this make to the patient?  Outpatient services are covered under Medicare Part B (like doctors’ services) so when a patient is not admitted, he or she will generally have a 20% copay for each service received.  The total costs can exceed the Part A one-time deductible.

Additionally, Medicare's coverage of inpatient rehabilitation (at a skilled nursing facility) is based on a qualifying three-day inpatient hospital stay.  Therefore, an individual needing inpatient rehabilitation may find himself footing the bill (which can quickly become very expensive) for those services.

What can patients and their families do when faced with this issue?

• Be your loved one’s advocate-ask questions, find out about the patient’s status in the hospital and stay aware of issues such as this.
• Talk to the physician and case manager about the patient’s circumstances, needs, and care planning, particularly about after-care options.
• Document who you talk to and the information provided.
• Consider hiring a professional patient advocate such as a geriatric care manager (to navigate the healthcare system, help with alternatives, set up after-care and anticipate possible problems, and especially for family members trying to manage care from a distance).
• Seek alternatives: If patient doesn’t qualify for inpatient rehabilitation at a skilled nursing facility under Medicare, can he be admitted to hospital rehabilitation program?  Can Medicare home health services provide therapy and after care?  What other services might be needed at home to ensure safety?
• Find out about your appeal rights.  Here is the link to Medicare's publication on how to file an appeal and where to get help.

Watch the Webinar Shannon recently presented for eCareDiary: “Mom’s in the Hospital-What Now?”

Shannon Martin, M.S.W., CMC, is Director of Communications at Aging Wisely, LLC (http://www.agingwisely.com), a professional care management and patient advocacy organization and EasyLiving, Inc. (www.easylivingfl.com), a licensed home care agency, in Clearwater, FL.  Shannon created a course on “Eldercare” as adjunct professor at Eckerd College in St. Petersburg, FL.  Prior in her career, Shannon served as social services director and admissions coordinator in an assisted living/skilled nursing facility and worked as a social worker and volunteer coordinator for a large hospice

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