Blog for John Sweeney - Elder, Wills, Estates, Trusts, Special Needs, Business, & Tax Lawyer in CT and NY

Medicare, Hospitals and Observation Status

Posted by John Sweeney | Mar 04, 2014 | 0 Comments

Follow the Money, Follow the Money... Medicare Bingo

Yes, it is a cat and mouse game where the hospitals try to get as much money from the government as possible….to the detriment of the patient.

This one is a classic case.  ObamaCare changed the law to make hospitals more responsible and they are penalized if a patient is readmitted within 30 days of treatment.  Sounds fair right, your car mechanic fixes your brakes and they don't work right, he doesn't get to charge you a second time to fix his first mistake.

In addition, under Medicare, you are entitled to 100 days in a nursing home or skilled facility paid by Medicare (at least partially) if you were in the hospital for 3 days.

So the hospitals, to avoid readmission penalties, are not “admitting” people.  Instead they are keeping them under “observation” status.  Then, if they are readmitted within 30 days, there is no penalty since they were never admitted in the first case.

But, and here is the catch, if you were only on “observation” status, then you don't get your 100 days in the nursing home from Medicare.

So, yes, the hospitals are playing a game whereby you have to cover the $400 a day for nursing home care out of your own pocket so they can't get penalized for poor care.  Does the hospital have to tell you that you are only being "observed"?  Nope (they do in NY).

While there are various bills in the states and Congress to fix this, it is the current state of things. In the  meantime watch out for yourself and Follow the Money.

About the Author

John Sweeney

John is an experienced lawyer who helps you solve your problems. He practices Elder, Wills, Estates, Trusts, Special Needs, Business, & Tax Law in Fairfield County CT and Westchester County New York. He brings a wealth of experience in law, business, tax, insurance, and finance to arrive at practical solutions with compassion and care. Honest, direct and practical, he is focused on you and your problems. He also brings a wealth of personal experience from his own large family and aging parents.


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Elder, Wills, Estates, Trusts, Special Needs Tax & Business Law; Attorney John Sweeney

Sweeney Legal, LLC, provides legal, practical, and business counsel to Seniors, families, and businesses in the Fairfield, Connecticut area, including the communities of Bridgeport, Bethel, Brookfield, Danbury, Darien, Easton, Fairfield, New Canaan, Newtown, Norwalk, Redding, Ridgefield, Stamford, Weston, Westport and Wilton. John is also licensed in New York serving Westchester County including the towns of Bedford, Lewisboro, Mount Kisco, North Salem, Pound Ridge, and Somers.