For the past few years I have been writing about a continuing problem for hospitalizations and insurance. For Medicare recipients who are hospitalized, one crucial question has been whether that trip to the hospital will be covered and, if so, whether Medicare A or Medicare B will pay. It makes a difference.
On March 8, 2017, another law quietly went into full effect and, as with other laws before it, in attempting to dispel confusion, it raises other questions. The federal law, known as the NOTICE Act, requires hospitals in some cases to provide both oral and written notice to patients within 36 hours of their coming to the hospital if they are not considered inpatients or, stated another way, if they are not considered “admitted.” A standardized notice known as a MOON (Medicare Outpatient Observation Notice) is furnished to affected patients notifying them that they are considered “under observation” and not admitted.
The MOON (Medicare Outpatient Observation Notice) begins with a statement “You’re a hospital outpatient receiving observation services. You are not an inpatient because…” A blank space follows in which the hospital representative is to insert a reason for considering the patient an “outpatient receiving observation services” and not an inpatient. There are some reasons why patient representatives have been described as being “not over the Moon” for the MOON Notice.
Let’s begin at the beginning. Your average person using common sense principles, might believe he or she knows the difference between observation and admitted. Someone under observation, it might be thought, is someone who is undergoing tests and only briefly at the hospital, possibly in the emergency room. Someone who stays, sometimes for several days, is thought to be admitted. That assumption can be wrong.
If you are on Medicare and admitted to the hospital, your coverage is considered under Medicare Part A. If you are not admitted, even if you are sleeping in a hospital bed and receiving meals there, and even if tests are being run, you are considered to be under observation. Under observation may mean that the hospital is attempting to determine the cause of your distress. The practical effect is that it is outpatient and is covered under Medicare Part B, a less generous coverage with more copays and deductibles.
If you are a Medicare patient who has been admitted for three midnights, then you may on leaving the hospital receive up to 100 days of rehab either in a skilled nursing facility or rehab or at home. Note that the expressions are “inpatient” and “up to” 100 days. A former hospital inpatient can and usually does receive less than 100 days rehab. On the other hand, if you are not admitted to the hospital and are under observation, you are not entitled to the follow up rehab under Medicare A. Therefore, it is very important to determine whether you are “admitted” or are considered “outpatient” or “under observation.”
Here are some problems with the MOON Notice:
- There are no appeal rights. Once you receive a MOON Notice you do not have the right to file an appeal of the decision. This is unprecedented. If you disagree there is currently no process to permit you to challenge the decision. Note that this is not the same as appealing a discharge from the hospital. You can appeal a proposed discharge but not the status of “under observation.”
- There is no direction what to do if you receive a MOON Notice. Would the average patient simply arrange to be signed out of the hospital, to be followed up by a physician at home or continue the hospitalization knowing that medications and services can be more expensive while in the hospital and rehab following hospitalization will likely not be covered under Medicare? There is no standard answer.
What can be done? If you or a family member or friend is hospitalized, ask whether the hospitalization is considered an “admission” and the date and time. This can be done even before receipt of a notice. By the way, Pennsylvania has another law, Act 169 of 2014 that also provides a notice provision to be provided within 23 hours.
Where help is needed, consult your doctor first, then, if needed, an attorney with background in Medicare.
The Center for Medicare Advocacy, www.medicareadvocacy.org. is an excellent source of information and can be consulted for further information.
