Medicare’s Observation Status Makes Inpatients Into Outpatients – lessons for single payer advocates.

This post is not intended to be anti single-payer health care or anti-Medicare, but it is intended to point out the immense complexity and bureaucracy that must accompany both.

Such plans do not simply pay all bills or provide everything for free as some advocates seem to imply.  They must manage costs and thus manage the care they pay for (or not). This is true of every such system, even the ones held up as models for the US.  Every single payer system in the world uses some forms of rationing or limits on care. If you expect otherwise, you will be disappointed.

Americans are pretty much used to any health care they want, when they want it. You can forget that!

Take a look at this story, but also remember that if Medicare didn’t have these restrictions and paid more of the bills, the trust would be bankrupt sooner and taxes and premiums to support the program would be higher.

Source: Medicare’s Observation Status Makes Inpatients Into Outpatients : Shots – Health News : NPR

One comment

  1. When I read this story yesterday, I was wondering what I would do. Medical coding, transparency, and the hope of the average person in understanding billing and payment practices is impossible. The hospital has to use a computer program to figure out the correct billing.

    Here is a person who thinks they have insurance that will cover them only to find out that they can’t stay at a hospital and they can’t go home. I am not saying that this gap in coverage wasn’t there but what normal person could possibly figure out that this gap would one day apply to them?

    To me, if you spend four days in a hospital bed on your back, then you are an inpatient for four days. I had no idea that it could be any other way. I am also not sure what the next phase of your treatment has to do with your hospital patient status.

    This also reminds me of people being billed by out of network doctors or lab services while they were a patient in an in-network hospital. I don’t think that this problem is restricted to single payer systems. Each insurance plan has its own rules. In cases like this article, a sick person didn’t get a chance to shop around for the type of care. What would have happened if there was no family member to help pay for rehab? Would they kick her to the street? Would they just send her somewhere she couldn’t afford and send the bill collectors after her?

    As far as the statement that Medicare would go broke faster if they pay is irrelevant here. Any insurer would go broke if they didn’t set limits. The question is; is there any insurance coverage that is affordable that would have paid in this case of coverage gap? How is the average person supposed to know that there is this gap? Was this Medicare rule of inpatient vs outpatient coding being applied correctly or need to be change for these types of cases?

    I have no answers, only questions.


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