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We Reiterate: Why Let it Continue?

The January 4th New York Times story, “The Hidden Financial Incentives Behind Your Shorter Hospital Stay,” describes how hospital stays classified under “Observation Status” are skewing admission and readmission data. As Dr. Jha states in the article, Observation Status is driven by incentives for the hospital. This is an ever-increasing phenomena in which Medicare deems patients as “outpatients,” although they are in the hospitals for days.

The Center for Medicare Advocacy has worked for many years to end the harm that Observation Status causes people who rely on Medicare. We have helped hundreds of beneficiaries and families, assembled a broad national coalition to support legislation to fix the problem, and filed lawsuits on behalf of elderly patients.

“Outpatient” hospital observation status limits access to necessary post-hospital nursing home care, alters public health data regarding hospital admissions and readmissions, increases Part B costs and cost-sharing, and creates lengthy delays in the Medicare appeals system. With all this harm, one must ask: Why does the Centers for Medicare & Medicaid Services insist on continuing this dreadful policy?

January 21, 2016 at 3:53 pm Leave a comment

Why Continue Observation Status?

The December 2, 2015 Wall Street Journal story “Medicare Rules Reshape Hospital Admissions” described how hospital stays classified under “observation status” can lead to big bills for patients without their knowledge.

The Center for Medicare Advocacy has worked for many years to eliminate, or at least reduce, the harm that observation status causes people who rely on Medicare.  We have developed self-help materials,http://www.medicareadvocacy.org/self-help-packet-for-medicare-observation-status/, assisted beneficiaries and families, brought together a coalition of national organizations to support federal legislation that would fix the problem, and filed lawsuits.

“Outpatient” hospital observation status is limiting access to necessary nursing home care, skewing public health data regarding hospital admissions and readmissions, increasing Part B costs and cost-sharing, and creating lengthy delays in the Medicare appeals system. With all this harm, one must ask: Why does the Centers for Medicare & Medicaid Services insist on continuing this dreadful policy?

December 14, 2015 at 7:35 pm Leave a comment

Solution to Medicare Part B Cost Increases? Look at “Observation Status”

If Congress and the Administration truly seek ways to limit Medicare premiums and deductibles (Robert Pear, 10/6/2015, and 10/15/2015), they ought to look at the Medicare agency’s hospital Observation Status policy.

A major cause of the Part B increase is likely the parallel increase in so-called “outpatient” observation status. The result of this misguided policy is that unprecedented amounts of hospital care are being billed to Medicare Part B, rather than Part A. This was never intended by the law. In fact Part A is called “Hospital Insurance” in the Medicare Act. Yet, thousands of patients stay days in hospitals only to learn they were not admitted as inpatients. Instead, they are classified as outpatients on observation status. One of the myriad consequences of this policy is that Part B expenses are sky rocketing – increasing Part B premiums and deductibles and cost shifting to Medicare beneficiaries.

October 15, 2015 at 3:25 pm Leave a comment

The Ryan Budget: Déjà Vu All Over Again (Again)

On April 1st Representative Paul Ryan rolled out yet another “Path to Prosperity,” as he annually calls his budget.  Unfortunately, the budget is a repeat of past year plans and is not a path to prosperity for most Americans – or for Medicare.

Once again, Rep. Ryan’s budget proposes a private approach to Medicare:

For future retirees, the budget supports an approach known as ‘premium support.’ Starting in 2024, seniors (those who first become eligible by turning 65 on or after January 1, 2024) would be given a choice of private plans competing alongside the traditional fee-for-service Medicare program.

Rep. Ryan has proposed “premium support” for future Medicare participants many times in the past.  While his budget assures us that “this is not a voucher program,” it is, once again, a proposal to pay a certain amount towards private insurance for Medicare beneficiaries. Ironically, Mr. Ryan states such insurance plans “would be available in a newly created Medicare Exchange.” This is ironic because the proposal is remarkably similar to the Affordable Care Act marketplace that is so maligned by Mr. Ryan and his colleagues.

Rep. Ryan suggests that changing Medicare to premium support is needed because

the government has been … a clumsy, ineffective steward of value. Controlling costs in an open-ended fee-for-service system has proved impossible to do without limiting access or sacrificing quality.

In fact, over the last few years traditional Medicare per-capita cost growth has declined, leading the way to parallel reductions in the rise of overall healthcare costs.

The unnecessary costs for the government, taxpayers, and all Medicare beneficiaries that need controlling are the hundreds of billions of dollars in excess payments to private Medicare Advantage plans under Medicare Part C and private pharmaceutical companies under Medicare Part D.  These unnecessary private industry payments are the real threat to Medicare’s future.  If Mr. Ryan’s goal is really to save money and preserve a strong Medicare program, he would look to these cost overruns for savings. He certainly would not propose further privatizing Medicare.

However, the latest Path to Prosperity does again seek to privatize Medicare. At the same time it would reduce Medicare’s value to older people and people with disabilities by:

  • Increasing the age of eligibility to 67.
  • Charging more for Medigap coverage.
  • Combining Parts A and B cost-sharing, thereby increasing costs for most beneficiaries.
  • Increasing premiums for more beneficiaries.

Regrettably, the Ryan plan may provide a continued path to prosperity for private insurance and pharmaceutical companies, but it is a dead end for Medicare, older people and people with disabilities.

April 3, 2014 at 8:26 pm 1 comment

Fair Prices for Prescriptions = Fair Pay for Physicians!

Year after year congress has passed a short-term physician payment package instead of permanently fixing the unfair payment formula for doctors who treat Medicare patients.

This year could be different

Today, in Congress, there’s a real solution for this ongoing problem.  Senator Rockefeller’s Medicare Drug Savings Act of 2013, which will allow Medicare to negotiate prescription drug prices for low-income beneficiaries, will save Medicare $140 billion over 10 years – almost the exact amount needed to permanently fix the physician payment formula and fairly pay doctors who treat Medicare patients.

Join us. Tell Congress you support finally fixing the formula by which Medicare pays physicians (it’s called “SGR”), but that the cost of doing so cannot be shouldered by older and disabled people.

In particular, Congress should not:

  • Cap coverage for necessary care,
  • Increase premiums, copays, and other costs for Medicare beneficiaries,
  • Allow help for low-income people on Medicare to expire.

The timing couldn’t be more perfect.  Senator Rockefeller’s Medicare Drug Savings Act is the solution.  Congress can permanently fix the physician formula and pay for it by allowing Medicare to obtain the best possible price on prescription drugs for low-income individuals.

It’s a Win-Win Situation

Write your Senators and Representatives today:

  • Remind them of your support for Senator Rockefeller’s bill, and
  • Tell them to use the prescription drug savings to fairly pay physicians who treat Medicare beneficiaries!

November 22, 2013 at 7:23 pm Leave a comment

Alternative Recommendations from Long Term Care Commission Members, Including the Center’s Judith Stein

Five members of the national Commission on Long Term Care, including Judith Stein, issued a statement on September 13, 2013 outlining alternative recommendations from the Commission’s majority to address the needs of Americans who require long-term services and supports (LTSS).

Read the full press release and recommendations

September 17, 2013 at 2:42 pm 1 comment

Why DOMA Matters for Medicare

This week, the Supreme Court is set to hear oral arguments in two cases relating to the Defense of Marriage Act (DOMA), the law prohibiting the federal government from recognizing same-sex marriages. DOMA has serious implications for same-sex couples regarding the benefits they earn, including Medicare.  How same-sex couples qualify and pay for Medicare is directly impacted by DOMA – and has serious financial ramifications for these couples.

Access to Medicare is generally achieved by reaching age 65 and accruing 10 years (40 quarters) of Social Security-covered employment, or by being the spouse of a worker who is age 65 who has accrued 40 qualifying quarters.  Because the federal government cannot legally recognize the validity of a same-sex married couple under DOMA, same-sex spouses with no work history, or fewer than 40 qualifying quarters, cannot acquire Medicare coverage on the basis of their spouses’ work history.  In order to have access to Medicare coverage that would be available to an individual in a mixed-gender marriage, a spouse in a same-sex marriage must pay hefty out-of-pocket premiums to buy into Medicare Part A. In 2013, the monthly Part A premium is $248 for beneficiaries with 30 to 39 quarters of qualifying work history, and $451 for those with less than 30 quarters in the system.

Simply put, DOMA often causes same-sex couples to pay significantly higher out-of-pocket costs for Medicare than they would if they could legally marry in their states and if their marriages were recognized federally. Though some progress has been made by the Department of Health and Human Services in recognizing the rights of same-sex couples regarding hospital visitation, DOMA still presents them with significant barriers to affordable health care under Medicare.

The Supreme Court’s rulings on DOMA will have serious implications for same-sex spouses and their families. Ironically, this is LGBT Health Awareness Week. We hope the Supreme Court will mark the occasion with a decision that recognizes the full and equal rights of Americans in same-sex marriages.

March 26, 2013 at 4:02 pm Leave a comment

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