ADMIT vs OBSERVE – a bad decision could bust a hole in your wallet.

Any time that you go to a local Emergency Room/Department and then to a hospital room, the charges that Medicare pays for vary significantly depending on what words were used to classify your stay.  If the words “Admission” or “Inpatient” were used, then Medicare will cover most of your charges. If, instead, words like “Observation” or “Outpatient” were used, then get prepared for a substantial bill.

But the discrepancy in Medicare coverage for the two classifications continues if you go to a Skilled Nursing Facility (SNF), Assisted Living or a Memory unit after being discharged from the hospital. Medicare will pay nothing for your care there if your status in the hospital was “Observation” or “Outpatient.”  This means that Life Care II contract holders (the largest group of current residents) in 2017, will face – at a minimum -- out of pocket fees of about $180 per day if the hospital stay classification was for “Observation” or as an ‘Outpatient.” (Refer to the table below for details for each type of contract.)  This is in addition to the monthly fees for your residence and the costs of medications. And like almost everything else, these fees will likely grow over time.

You or your representative can act to ensure that Medicare pays its share of your hospital stay and temporary post-hospital care in Skilled Nursing, Assisted Living or a Memory Unit. Spend some time reading these important suggestions from the Center for Medicare Advocacy. Consider printing them out and keeping them in your Vial of Life or with other important papers.