An unintended glitch in Medicare rule is hitting a growing number of seniors with thousands of dollars with non-reimbursed hospital bills, according to a recent article in Bloomberg Business Week.
Medicare expanded a pilot program in December 2008 aimed at conducting audits to cut fraud. Since then, the number of patients nationally who placed in long-term observation has increased and therein lies the problem. Under Medicare rules, patients who are listed "under observation" face 20% co-payments that they would not if actually admitted to the hospital. Furthermore, expensive aftercare is not covered at all!
The "under observation" classification was to be designed when there is not an immediate diagnosis, or if it is determined the condition is not normally treated under "inpatient" care.
The problem is that hospitals are extending the the use of the "under observation status" in order to hide behind it so that Medicare auditors will not challenge them on patient admissions when cases lie between inpatient and outpatient.
Barbara Easterling, president of the 4-million grassroots senior activist organization, Alliance for Retired Americans is calling on Congress to clean up the problem. "In the past, hospitals and physicians were on their honor, but no more" she said. "Congress needs to make it clear that anyone who is in a hospital for 24 hours or more is considered an inpatient.
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