The Hospital Surprise You Don’t Want to Get Under Medicare
Imagine you’re in a hospital room. You’re sick, nurses are checking on you regularly, you’re receiving medications, and your doctor has ordered tests and treatments. Naturally, you assume you’ve been admitted to the hospital.
Then you receive an unexpected surprise.
You learn that you were never admitted as an inpatient. Instead, you were receiving Observation Care.
Observation Care is used when your doctors need additional time to evaluate your condition and determine whether you need to be admitted or can safely return home. Although you may stay overnight—or even longer—you are considered an outpatient under Medicare.
For many patients, there is little noticeable difference between observation care and an inpatient stay. You may have the same room, the same nurses, and receive many of the same treatments. The difference is how Medicare classifies your stay—and that classification can affect what you pay.
How Observation Care Can Affect Your Costs
Because Observation Care is billed as an outpatient service under Medicare Part B, your out-of-pocket costs may differ from those of an inpatient admission under Medicare Part A.
Depending on your situation, you may be responsible for:
● Part B coinsurance for many hospital outpatient services (generally 20% of the Medicare-approved amount after you meet your Part B deductible).
● Charges for certain medications you receive during your observation stay, including many self-administered prescription and over-the-counter drugs that Medicare Part B generally does not cover.
For example, a low-cost medication such as a baby aspirin that costs only pennies at your local pharmacy could cost significantly more when provided by the hospital. While each individual charge may seem small, they can add up quickly. Original Medicare also generally does not include an annual out-of-pocket maximum.
The Nursing Home Surprise
Observation Care can also affect your eligibility for Medicare-covered skilled nursing facility care.
In most cases, Medicare will only pay for a covered stay in a skilled nursing facility if you first have a qualifying inpatient hospital stay of at least three consecutive days. Time spent under Observation Care does not count toward that requirement.
This can come as an expensive surprise for patients who need rehabilitation or skilled nursing care after leaving the hospital.
Know Your Status
To help patients understand their hospital status, hospitals are required to provide the Medicare Outpatient Observation Notice (MOON) if you receive observation services for more than 24 hours. The notice explains:
● Why you are receiving Observation Care instead of being admitted as an inpatient.
● How your status may affect Medicare coverage and your out-of-pocket costs.
If you or a loved one is in the hospital, don’t hesitate to ask:
“Am I admitted as an inpatient, or am I under Observation Care?”
Knowing the answer can help you better understand your Medicare coverage and avoid unexpected expenses.
For more information about Observation Care, visit Medicare.gov.
If you have questions about Medicare or would like help understanding your coverage, contact Bethany Sullivan at Sullivan Health Care Solutions by calling 262-261-8027.