GRAND RAPIDS, Mich. (WOOD) — December 2012 was hardly a time to celebrate the holidays for Richard and Helen Bellows.
Right before Christmas, Richard Bellows fell going up the stairs. The next day, Helen called an ambulance when her husband couldn’t get out of bed. The next few days in the hospital would be a whirlwind of confusion, concern and unexpected expenses for the couple.
Richard had five broken ribs and a punctured lung, which collapsed. He spent nearly three days in the hospital on oxygen.
Helen remembers signing a paper about her husband’s stay. Their daughter also remembers her mother signing off on her father remaining under ‘observation,’ a term they thought meant he was admitted and under close watch by the nurses. They had quite the surprise when they realized there was much more to that term, meaning Medicare would cover a lot less.
“It’s devastating for everybody. You go into the hospital thinking you’re covered and you’re not,” Helen Bellows said.
MORE | PDF: Are You a Hospital Inpatient or Outpatient?
Because Richard Bellows didn’t spend at least three days admitted as an inpatient, Medicare didn’t cover a penny of his nine weeks of rehab.
“Of course we were confused about the whole thing. He didn’t know anything about it because he was so sick that he wasn’t aware,” his wife said.
According to the Centers for Medicare and Medicaid Services, observation patients are simply a type of outpatient. Essentially, you’re assigned observation status if you’re not sick enough to be admitted as an inpatient but too sick to go to your doctor’s office.
“I didn’t quite understand because he was right there,” Helen said. “He had the nurses and the meals came and everything.”
While some hospitals have a special observation area or wing of the hospital for observation patients, many simply put their observation patients in the same rooms as their inpatients.
Ann Thomas, the long-term care chairperson with Advocates for Senior Issues in Grand Rapids, Michigan said several people turned to her at advocate meetings saying they had been taken advantage of.
“Every story I heard, I got madder and madder,” Thomas said.
It motivated her to put together an informational brochure defining inpatient status and observation status and further explaining how both have an impact on Medicare coverage.
MORE | >>PDF: The brochure
“You are absolutely caught flat-footed, and it just is a tremendous problem for a family,” Thomas said.
“It’s strictly up to the patient and the patient’s family. They have got to speak up,” Ann Thomas said.
The Bellows’ daughter, Connie Bellows, went to bat for her parents. She spent months making phone calls to the hospital, Medicare and their insurance company. In the end, they still paid thousands of dollars they weren’t expecting to.
“The bureaucracy is so complex. I have a background in human resources. I was the director of human resources for 15 years and I had a hard time wading through everything and understanding,” Connie Bellows said.
Mary Cooley, the vice president of Care Management and Medical Operations at Priority Health, pointed out that federal guidelines determine whether someone is assigned inpatient or observation status.
“I really do feel it’s really based on what the patient needs and that’s what we want patients to focus on,” Cooley said.
Still, every patient should know which category they fall under and why. For example, if your insurance company doesn’t agree you need the intense service of inpatient care, you may be denied coverage.
“He had contributed to Medicare all those years that he worked and then when he needs it, it’s not there,” Helen Bellows said.
Hospitals are now required by law to notify you of your admission status verbally and in writing. That rule went into effect just a few months ago.