Charlotte’s Blog

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A Medicare Scam?

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Well, not exactly, but if you or an older loved one goes to the hospital, beware of what can happen that is not outpatient, and it is not inpatient. They call it Observation, and it may seem like your loved one has been admitted for an overnight stay, because they do get “discharged” – but in this case in just about 23 hours. Because it is NOT an inpatient stay, it has a different payment requirement and according to recent research, it seems to unfairly target poorer Medicare-eligible Americans.

According to the longstanding rules of Medicare, patients with this coverage pay a fixed cost for an inpatient stay and that is going to cover the majority of costs incurred while in the hospital as well as follow-up nursing care and even repeat hospitalizations that occur within two months of that first visit.

There are also rules for the short stay that is less than 24 hours; they call this an “observational stay.” And if you are a caregiver to an older loved one, you will want to ask for a very clear answer whenever your loved one is in the hospital. You will want to ask the registration people or the nurse on their unit if this is an observational stay or an inpatient stay. The reason you need to ask is that there are substantial cost differences. A patient under “observation” will be billed for a one time out of pocket fee along with 20 percent of any hospital services bills and the tab for any medications. If you are told that this is to be an “observational” visit, get in touch with your loved one’s physician and have them go to bat for you. The hospital makes more money on an observational visit…and it may not be warranted.

There is more. The poor pay more…more often that is. In a recent study by some policy researchers published in The American Journal of Medicine, they looked at the Medicare claims data for some 132,000 hospital observations across 97 percent of all the U.S. counties. They compared the wealthiest quarter of these patients with the poorest quarter and found that the patients in the poorest quartile were 24 percent more likely than their more affluent counterparts to have three or more observational stays in a year.

We would like to think that no hospitals are looking to take undue advantage of poorer patients, and there is the potential for Medicaid to offset some of the difference. It does suggest, however, that less affluent patients may not have someone who goes to bat for them, someone who will ask the right questions. So, if you are a caregiver to an older loved one, now you know to ask the right questions. And you know what the answers should be.

Charlotte Bishop is a Geriatric Care Manager and founder of Creative Care Management, certified professionals who are geriatric advocates, resources, counselors and friends to older adults and their families in metropolitan Chicago. She also is the Amazon Bestseller and author of How Do I Know You: A Caregiver’s Lifesaver for Dealing with Dementia.

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