I didn’t realize this. Patients who are admitted under “observation” status gets shafted by Medicare for drugs. This is a terrible loophole.
As an internist, when someone was admitted, it didn’t matter to me whether they were admitted to “inpatient” or “observation” status. The work was the same. To patients, an overnight stay at the hospital counts as an admission. The only difference is how the visit was coded. And trust me, this decision was purely subjective.
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The difference for the hospital is also huge – for obs: about $400 plus services, for inpatient DRG – about $5200 (depending on the DRG of course).
The company I work for, EHR (www.ehrdocs.com) helps hospitals make this decision by providing 7-day a week telephonic reviews by physicians.
We have hundreds of clients now, and the business is growing quickly.
-Dr. Steve
I’ve never admitted anyone under 23 h observation
“I’ve never admitted anyone under 23 h observation”
The medicare rules for obs admits are relatively (for medicare) clear. If the pt doesn’t qualify for a regular admit than you are supposed to admit to obs. Now I suppose you could “oversell” the admission in the H & P. However, later you could theoretically be accused of fraud by auditors. Not worth it to me. If the pt only meets criteria for obs. I admit obs. Think about it and review the guidelines. The heavy hand of the government could be accusing you of “fraud” otherwise.
What are the Medicare criteria for obsv vs. admission?
I don’t think they are “clear” and I make that call 20-30 times a day.
Think of it this way – observation status is like an extra room in your office where you can use up to 48 (not 23) hours to make up your mind if the patient needs admission or not.
If you decide to admit, you should be providing “inpatient services”
-Dr. Steve
Well Dr. Steve since you claim to ba an “expert” on the subject.
Then you know the guidelines
(and you are correct it is 48 hours) state what should be admitted as inpatient and what as obs status for those who don’t qualify. Sorry I don’t play fast and loose with the guidlelines to make myself (or the hospital) extra money. To many docs have been accused of medicare “fraud” for simply not knowing the rules.
PS: Though I may not be sitting at a desk making that “call” 20-30 times a day.I have been a hospitalist for years so I think I know what I am talking about.
Well, first – you as the admitting doc will not make more money by admitting to inpatient – the difference in reimbursement for admission to inpatient vs. admission to obs. for the doctor is about 25 cents. (0.01 value units).
Second, it would be irrepsonsible of me to put forth iron clad guidelines when CMS itself has not done so. I will say that CMS allows you to focus more on severity of illness as opposed to intensity of service, so there are many patients who will not meet Interqual or Milliman criteria but that Medicare will think is fine. I know this becuase I also used to work for the QIO in my home state.
-Dr. Steve
I will say that so far, none of our over 200 client hospital has been audited by their QIO since adopting our progam.
Which brings us back to the original point.
This is a purely subjective decision of little consequence to the physician (reimbursement wise), but matters greatly to the patient.
Thanks,
Kevin
The comments posted here are living proof to me, just why Case Managers are in high demand and have such great job security. I’ve heard that bad information is worse than no information at all. Oh boy, is that ever true in this instance.
The changes in reimbursement for physicians require them to know whether their patients have been admitted as an inpatient or an obs patient and have their visits coded accurately. Failure to code correctly will more than likely result in a denial very soon according to CMS guidelines.
Medicare observation status allows the physician time to decide whether or not the patient is responding to treatment. And, if not, to admit the patient within 47 hours and 59 minutes. The order to admit must be accompanied by documentation of why the patient requires additional care as an inpatient. Admitting a patient that meets inpatient criteria from the start results in approximately 90% less reimbursement. That amounts to several million dollars of revenue lost each year for your hospital as a result of physician ignorance. It’s a problem!!
Just because you are unfamiliar with inpatient and observation criteria does not mean they don’t exist or that they are not extremely specific. However, physicians have demonstrated their lack of expertise in this area routinely, across the board and admit observation patients and inpatients incorrectly. They cost hospital billions. CHS, the nation’s largest privately held hospital system is cracking down on this and will allow a hospitalist 5 denials before taking action which may result in contract renegotiations, in other words, replacement. It is a serious issue and I would recommend physicians become completely familiar with the information. It is readily available from you hospital’s Case
Management Department.
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