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Washington state tackles observation status with new bill

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Have you noticed that those of us not in the know can use words that look, taste and sound like something a professional says and discover we’re all talking about two different things.  Take the term admit.  You go to the theater and they give you a ticket which ironically enough says “admit one” and so with our little ticket we are admitted to the theater.  The actual definition of admit says it means to allow someone to enter a place…to allow entry, permit entry, usher in, show in…  You get what I mean.    You can be admitted to the bar, to the union, to a party and to the hospital.  And in all those cases it means you’re in.  But here’s where the difference lies.

If you’re sitting in a hospital bed, you probably think I’m in—I’ve been admitted.  It’s even part of our expression.  “Susie’s in the hospital.  They admitted her 5 minutes ago.”  The question is—did they?  It shouldn’t be so confusing but it really is and here’s why it’s a problem.  If you spend two or more midnights in the hospital, Medicare expects you to be considered an inpatient, someone who has been admitted.  If you spend less than two midnights in the hospital, Medicare expects you to be considered an outpatient.  Inpatient, outpatient—the two look remarkably similar.  In both cases, you’ll likely get to see a bunch of professionals that are allowed to work in their pajamas, hang out in a fancy Sleep Number bed with rail accessories and be poked and prodded like a baby bunny in a petting zoo.

But, inpatient care is covered by Medicare Part A, which pays for hospitals, and outpatient care is covered by Part B, which pays for doctors.  The financial difference can be devastating.  Part B bills patients separately for every procedure, visit and drug.  Co-pays can look like the down payment for a house or the cost of a really nice car.  Because time spent in the emergency room or in observation status does not count toward the three-midnight requirement for Medicaid to pay for skilled care, if while you’re in that fairy tale world, you get sent on vacation to the nearest skilled nursing facility.  You could find yourself with a bill large enough to pay cash for the car and possibly the house.

So far, with amazingly few exceptions, patients have not been in a position of any real strength.  Hospitals can tell you up to the time you leave whether your status is admitted or “observation” if you or whichever loved one is your healthcare proxy thinks to ask.  The problem is that plenty of people don’t read my articles and don’t listen to Rajiv’s radio show so they don’t know that “observation” is a dirty little word that can legally rob you of your assets and suck you dry.  Nor do they know that they need to make a concerted effort to find out how the hospital lists them.  The result is that plenty of people go home and a couple weeks later they open an envelope to a bill large enough to shock all but the most financially solid.

So far, few states have done a thing to fix this little idiosyncrasy but Washington is hoping to join New York and Maryland in requiring hospitals to notify patients of observation status.  HB 1186 “requires a hospital to provide oral and written notification to a patient or patient’s representative within twenty-four hours of having been determined to be in observation status.”  The bill, sponsored by Representatives Clibborn, Springer, Johnson, Senn, Moeller, McBride, Walkinshaw, Caldier, and Fey, is scheduled for executive sessions in the House Committee on Health Care & Wellness Feb 13, 17, 18 and 20.  If you’d like to comment on the bill go to this link.  You can also listen in next Saturday (Feb 21) to talk to Representative Clibborn on Rajiv’s radio show.

Other observation stories:

Judge throws out suit on observation status

Why your hospital status matters if you end up in the ER

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