Observation Stays Commonly Exceed Cost of Inpatient Deductible

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The researchers found that beneficiaries with multiple observation stays in a 60-day period had a cumulative financial liability of $947.40 on average.
The researchers found that beneficiaries with multiple observation stays in a 60-day period had a cumulative financial liability of $947.40 on average.

HealthDay News -- More than one-quarter of Medicare beneficiaries with multiple observation stays have a cumulative financial liability that exceeds that of the inpatient deductible, according to a study published online in the Journal of Hospital Medicine.

Shreya Kangovi, MD, from the University of Pennsylvania Perelman School of Medicine in Philadelphia, and colleagues examined the costs associated with revisiting observation care versus readmission for Medicare beneficiaries. 

The total cumulative financial liability for Medicare beneficiaries who revisit observation care multiple times within a 60-day period was determined using a 20% sample of the Medicare Outpatient Standard Analytic File.

The researchers found that beneficiaries with multiple observation stays in a 60-day period had a cumulative financial liability of $947.40 on average, which was significantly lower than the $1,100 inpatient deductible (P < 0.01). Of those beneficiaries, 26.6%  had a cumulative financial liability that surpassed the inpatient deductible.

"More than a quarter of Medicare beneficiaries with multiple observation stays in a 60-day time period have a higher financial liability than they would have had under Part A benefits," the authors write.

Reference

1. Kangovi S, et al. J Hosp Med. 2015; doi: 10.1002/jhm.2436. 

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