What is Observation Status and How Does that Impact Medicare?

October 18, 2018
Observation Status

Last year a federal law was passed requiring hospitals to inform Medicare patients when they were getting “Observation Care” rather than getting “Admitted” to the hospital. This distinction is very important because Medicare does not pay for observation care. Patients would leave the hospital with surprisingly large medical bills.

What you need to know:

  • Observation status requires the patient to pay a portion of all tests, treatments and services provided by the hospital.
  • For Medicare to pay for any nursing home care following the hospital stay, the patient must be admitted for 3 consecutive days and observation status does not count toward that requirement.
  • You must be notified both verbally and in writing if hospitalized for more than 24 hours if it is observation status. This notification must occur within 36 hours after being placed on observation status.
  • Denial of benefits can be appealed.

For more information on Medicare, visit the website for the Center for Medicare Advocacy (www.medicareadvocacy.org). For assistance with your Elder Law needs in the Greater Baltimore area, contact Stouffer Legal at 443-470-3599.

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