Know Your Rights: Big Bills from Hospital Observation Stays
Do you know your rights when it comes to hospital observation stays? Will they be covered by Medicare? Or could you be hit with the bill?
Last November, an 85-year-old woman learned the hard way what’s covered by Medicare. Because her hospital outside Philadelphia labeled her six-day stay as “observation,” the Medicare patient was hit with the $40,000 bill, according to the New York Times.
“The hospital insisted that Ms. Cannon had never been formally admitted there as an inpatient, so under federal rules, Medicare would not pay for her nursing home stay,” the New York Times reports. “The money would have to come from her pocket.”
Under a new law, the “Notice Act,” hospitals must notify “each individual who receives observation services as an outpatient” that their stays may not be covered by Medicare. That’s expected to produce roughly 1.4 million notices every year.
“The financial consequences of observation stays can be devastating for seniors,” says Senator Susan Collins, Republican of Maine and the chairwoman of the Senate Special Committee on Aging.
Recent studies have shown that hospital services are the biggest factor contributing to rising health care costs. These notices will help patients avoid massive bills.