Observation Status: New CMS Experiment and Senate Hearing

The Centers for Medicare and Medicaid Services (CMS) is experimenting with new payment arrangements that eliminate the three-day inpatient rule for seniors to get access to skilled nursing facilities (SNF) coverage under Medicare, according to Kaiser Health News.
The Senate Aging Committee also held a hearing on this problematic rule. “Medicare officials are at a critical juncture right now to determine payment rules for both inpatient and outpatient services for next year, and now more than ever, we need to shine a spotlight on the importance of this issue to beneficiaries around the nation,” said Chairman Sen. Bill Nelson (D-FL). Indeed, “the number of seniors entering the hospital for observation increased by 69 percent over five years, to 1.6 million in 2011,” says Ranking Member Sen. Susan Collins (R-ME). Both Sens. Nelson and Collins co-sponsored Improving Access to Medicare Coverage Act of 2013, which would end observation status for purposes of satisfying the three-day hospitalization rules for SNF coverage.

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