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House of Representatives
Session of 2013 - 2014 Regular Session


Posted: November 25, 2013 01:04 PM
From: Representative Stan Saylor
To: All House members
Subject: Patient Notice of Observation Status
Many older Pennsylvanians who are facing big hospital bills after being at the hospital following an emergency room visit have learned that being treated at the hospital does not mean they were ‘in’ the hospital. They were given an “Observation Status” determination which allowed physicians to gather information from tests about a patient to determine if they should be admitted to the hospital. While on “observation status” patients are treated as if they have been admitted to the hospital. Often it is an indistinguishable status to a patient.

There is a growing trend in the hospital industry to use “observation status” when classifying patients receiving care in the hospital after evaluations in an emergency room. Part of this is to avoid admission/re-admission penalties and audit scrutiny by the federal government.

One problem with this status is many insurers (and Medicare) treat observation stays as outpatient care so patients may pay for tests, X-rays, or scans. However, if the same procedures were done while being admitted to the hospital, the patient might only pay a single co-pay. The stakes become larger for our senior citizens on Medicare since a hospital admission of at least three days is required before Medicare will pay for subsequent skilled nursing care or rehabilitation in a nursing home. If a patient is in the hospital for three days before going to a nursing home, and one of those days was on Observation, Medicare will not cover the nursing home expenses.

The problem is that some hospitals do not make this distinction of “observation status” known to patients. This means the patient would have to ask if they are on an “admissions” or “observation” status.

I plan on introducing consumer friendly legislation to help hospital patients and their families better understand their health insurance options while receiving diagnosis and treatment in the hospital usually after an emergency room visit. This will help bring transparency to the hospital/patient relationship. My legislation would require the hospital to provide oral and written notice to the patient of their outpatient status after they have spent a full day in the hospital outside the emergency department. Informing patients of this status would bring transparency to patients and their families. Considering our rapidly aging population, this would greatly assist patients and their families with critical health care decisions.

I hope you will consider joining me in support of this legislation.

Introduced as HB1907