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Under Observation: Minnesota Looks to End Surprise Medical Bills

PHOTO: Minnesota lawmakers still have work to do, but one measure they passed this session aims to reduce the number of senior citizens getting caught with unexpected medical bills due to the impact of patient status on Medicare coverage. Photo credit: Ted Van Pelt/Flickr.
PHOTO: Minnesota lawmakers still have work to do, but one measure they passed this session aims to reduce the number of senior citizens getting caught with unexpected medical bills due to the impact of patient status on Medicare coverage. Photo credit: Ted Van Pelt/Flickr.
May 26, 2015

ST. PAUL, Minn. – Minnesota is taking action on a health care trend that's leaving some of the state's senior citizens with unexpected medical bills after a hospital stay.

For Medicare to cover the cost of certain services, the patient must be officially admitted, not just classified with an observation status.

The approved legislation requires hospitals to inform patients of their status and the potential ramifications within 24 hours.

That knowledge is vital, says AARP of Minnesota volunteer Vikki Casey Steward, whose 83-year-old mother had a recent hospital stay and ended up with a surprise bill.

"She was never informed that she was being put on observation status as opposed to being admitted in the hospital,” Casey Steward relates. “She had her own room, as normal of a hospital stay as anything had ever been. And this is the first time in 18 years as a Medicare patient she received a bill from the hospital."

According to a study by AARP, the use of the observation status by hospitals has greatly increased in recent years, along with the average length of time patients spend in observation.

In Minnesota, more than 800,000 people rely on Medicare for their health coverage.

In addition to being able to plan post-discharge treatment based on their Medicare eligibility, Linda Nelsen, chief executive officer with Benedictine Living Community of St. Peter, says patients who know their designation and believe it should be changed can then request that while hospitalized.

"So it could be someone's in the hospital more than two days and they could qualify, but they're not aware of it at this point,” she explains. “This legislation will then inform them so that they can get that changed and it's a benefit they're eligible for and they should get."

There's also been a national push on the issue with a bill being considered by Congress. It would require any time spent under observation to count towards the three-day in-patient stay, which is required for Medicare to pay for skilled nursing care after hospital discharge.

John Michaelson, Public News Service - MN