The Importance Of Hospital Admittance Classification Status

According to a recent study by Brown University, over the last several years there has been a 25 percent increase in hospitals classifying Medicare patients as "outpatients" under "observation" instead of being classified as "inpatients," even though they may be inpatients in everything but name.

Has this happened to you? If it did, you are not alone. An increasing number of elderly patients in recent years have been paying more for their hospital stays than they should have under Medicare. That's because of the way hospitals are now classifying their Medicare patients. An experienced attorney at the Westchester, New York, elder care law firm of Enea, Scanlan & Sirignano, LLP, can help.

Why Hospitals Are Doing This

Although Medicare reimburses hospitals at a lower rate for an outpatient observation versus inpatient, it appears Medicare rules are still driving hospitals' decisions. Hospitals are classifying more patients as outpatients under observation to avoid:

  • Medicare penalties should the patient be readmitted
  • Costly audits by Medicare of their admission claims
  • Reimbursing Medicare for the costs of services rendered should Medicare find the hospital incorrectly classified the patient as an inpatient

This may be fine for the hospital, but not so for the patient.

What This Means To You

For you as the patient, this means greater out-of-pocket costs, since you will be using Medicare Part B to pay for the stay, instead of Medicare Part A.

Should you then be discharged from the hospital to a skilled nursing or rehabilitation facility, you will be paying even more out-of-pocket costs.

Days In Skilled Nursing Or Rehabilitation "Outpatient": What The Patient Pays Per Day "Inpatient": What The Patient Pays Per Day
Days 1 through Day 20$0$369 on average
Days 21 through 100$144.50$369 on average

To address this classification issue, Rep. Joe Courtney (D-Conn), introduced H.R. 1179 in March 2013: Improving Access to Medicare Coverage Act of 2013. However, the bill stalled in committee.

What You Should Do Now

If you are admitted to a hospital, you and your physician should be vigilant, making sure you are properly classified. You can also contact the experienced lawyers at Enea, Scanlan & Sirignano, LLP. Call 914-269-2367 or, if you prefer, you may reach us by completing this online form. With offices in White Plains and Somers, we help clients throughout Westchester County, New York, and the surrounding areas.