Medicare Part A Includes Hospitalization
If you are admitted inpatient into a hospital, then you are covered by Medicare Part A. In 2013, this is subject to a $1184 deductible per benefit period. In other words, you need to pay the first $1184, before receiving any Medicare benefits under Medicare Part A. There’s more, however.
Observation Status Doesn’t Count
If you admitted to the hospital under “Observation” status, then this does NOT qualify for Medicare Part A benefits. You will be charged the entire amount. In addition, your Medicare Advantage and your Medigap policy will NOT cover you. That is because Medicare must be the primary payer before you receive benefits under either of these.
You Need to Check
It is understandable that this is the furthest thing from your mind. Nevertheless, you (or the person that is caring for you) need to be careful, or else you may be in for an unwelcome surprise.
Unfortunately, It Gets Worse
There are two additional points to know.
First, your status can be changed after the fact. The reason for this is that there is someone at the Medicare system reviewing your file before paying benefits. You may have been originally under inpatient status, but then have your status changed to Observation status.
Second, the Affordable Care Act encourages hospitals to admit patients under Observation status. The reason is, in an attempt to curb excessive hospitalization, that hospitals are fined if there are an excessive number of patients who are readmitted to the hospital for the same reason within 30 days. However, those admitted under Observation Status do not count towards this number. It is logical, then, that hospitals would want to admit someone under Observation Status, rather than inpatient, because that reduces the chance of paying this penalty to the federal government.
Maximize Your Medicare
Maximize Your Medicare is written to point out these subtle points. Many people do not know these points, and don’t become aware of them, until it is too late. The objective of the book is to provide the information before the fact. You are then in greater control of the risks that you are accepting. We cannot predict the future, but you can consider your own situation and your own priorities, so that you can choose for yourself.