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Medicare beneficiaries must get observation status notice

12-19-2016 - NOTICE (the 2015 Notice of Observation Treatment and Implication of Care Eligibility Act) requires hospitals to alert Medicare beneficiaries when their hospital stay has been classified as observation status, not official admission. The difference between the two classifications may be imperceptible to a patient occupying a hospital bed and being seen my medical staff. But post-discharge, the distinction can become very clear: Medicare will not pay for skilled nursing care without a three-day qualifying in-patient hospital stay. In addition, observation status patients may be responsible for co-pays and other expenses they had assumed Medicare would cover.

Beginning no later than March 8, 2017, hospitals must provide a written Medicare Outpatient Observation Notice (MOON) to Medicare patients who are on observation status for more than 24 hours. The form must be provided within 36 hours of entry into the hospital. The form outlines the financial implications of observation status. Hospital staff must also provide a verbal explanation of the information. The patient (or whomever is acting on the patient's behalf) will be asked to sign it. View the newly published MOON form here.

Here is another discinction that Medicare beneficiaries are well advised to keep in mind: being notified that you are on observation status does not actually remove your responsibility for post-discharge costs. Whether you sign the MOON form or not, Medicare rules will still apply, and skilled nursing care and other expenses may not be covered. The major advantage of being informed of your observation status is simply that it gives you an opportunity to request that your hospital stay be reclassified from observation status, to inpatient status.

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