Medicare officials have
proposed changes in hospital admission rules that they say will curb the rising
number of beneficiaries who are placed in observation care but are not
admitted, making them ineligible for nursing home coverage.
“This trend concerns us
because of the potential financial impact on Medicare beneficiaries,” officials
wrote in an announcement last week. Patients must spend three consecutive
inpatient days in the hospital before Medicare will cover nursing home care ordered
by a doctor.
Observation patients don’t qualify,
even if they have been in the hospital for three days, because they are
outpatients and have not been admitted. They also have higher out-of-pocket
costs than admitted patients while in the hospital, including
higher
co-payments and sometimes paying exorbitant charges for non-covered drugs.
Under the proposed changes,
with some exceptions, if a doctor expects a senior will stay in the hospital
for less than two days (or through two midnights), the patient would be
considered an outpatient receiving observation care. If the doctor thinks the
patient will stay longer, the patient would be admitted.
Setting deadlines for
observation stays would also limit the growing length of time of observation
visits, another trend officials said were troubling.
Reaction from patient
advocates, doctors and hospitals has been swift and unanimous: It’s a bad idea.
The number of observation
patients has jumped 69 percent in the past five years, to 1.6 million in 2011,
according to federal records. They also are staying in the hospital longer,
even though Medicare suggests that hospitals admit or discharge them within 24
to 48 hours. Observation visits exceeding 24 hours have nearly doubled, to
744,748.
Officials said extended
observation stays occur because hospitals are not sure Medicare will pay if
patients are admitted. The proposed changes are intended to address these
questions.
The proposed admission
changes are part of a 1,400-page annual hospital payment update released last
Friday. If adopted, the new admission rules would apply to more than 3,400
acute-care hospitals, and Medicare estimates that the change would result in
40,000 more inpatient hospital stays.
To offset the expected
additional cost of $220 million, Medicare would cut hospital payments by 0.2
percent.
Joanna Kim, vice president
for payment policy at the American Hospital Association, called the time factor
“somewhat arbitrary.” The association also objects to the pay cut, asserting
that the projected inpatient increase is not certain.
“I can’t imagine anyone is
going to like this proposed rule because it makes time the determining factor
in whether the services are provided on an inpatient or observation basis,”
said Toby Edelman, senior policy attorney at the Center for Medicare Advocacy.
“It is not about what the hospital is actually doing for you, what kinds of
care you need and are receiving.”
Edelman said the proposal
does nothing to help observation patients because it maintains
the
three-inpatient-days requirement, doesn’t require hospitals to tell patients
when they are held for observation and doesn’t give patients a right to appeal
their observation status. The center is representing 14 seniors who have filed
a lawsuit against the government to eliminate the observation care designation.
A federal judge is holding
the lawsuit’s first hearing Friday in Hartford, Conn., to consider the government’s
request to throw out the case because the seniors should have followed
Medicare’s lengthy appeals process before going to court. On Tuesday,
government lawyers submitted the proposed rules change to the judge to bolster
the argument for dismissal, claiming that it clarifies “when we believe
hospital inpatient admissions are reasonable and necessary, based on how long
beneficiaries have spent or are reasonably expected to spend, in the hospital.”
The American Medical
Association is still reviewing the proposed changes, which don’t include steps
it asked Medicare to take last year: either drop the three-day policy or count
observation days toward the requirement.
“This policy is of great
concern to the physician community because it has created significant confusion
and tremendous, unanticipated financial burden for Medicare patients,” James
Madara, the AMA’s executive vice president, wrote to Medicare. He also
criticized a hospital’s ability to overrule the doctor’s decision to admit a
patient, which creates more confusion when the doctor bills Medicare for
inpatient services and the hospital bills for observation services.
Source: WashingtonPost.com
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