Medicare’s “3-Day Rule” Lawsuit Goes To Trial

There was confusion and misinformation regarding the 3-day rule for skilled nursing facility coverage. In order to get the 100 days of skilled nursing coverage from Medicare, the mandate states a beneficiary must spend at least 3 days in the hospital as an inpatient. However, doctors and hospitals can admit elderly patients on an “observation stay,” which does not count as an “inpatient.” A class-action lawsuit, filed back in 2011, challenged Medicare’s eligibility rules for skilled nursing coverage. Trial over the lawsuit is finally being heard in a federal courtroom.

After an “observation stay,” senior patients are then discharged to a skilled nursing facility, complete with a bill. Because a substantial number of hospitals follow these routines, seniors are often forced to pay these bills out of pocket. Medicare will not cover the costs since it does not qualify as full admission.

In recent years, Medicare imposed strict limitations on hospital admittance. This explains why patients who are admitted are put under “observation.” Medicare pays one-third less for an observation patient than one who is in full admission. While Medicare benefits from these cost-saving tricks, it’s the patients that suffer.

Another way Medicare saves itself money is by shifting the cost of hip and/or knee replacements onto the beneficiaries. Medicare encourages doctors to perform these replacements as outpatient surgeries so that discharges happen within a few days.

This has caused an uproar with patients because many of them simply cannot afford sky-high medical costs. So in turn, about 14 patients filed a class-action lawsuit. If they win, Medicare might have to reimburse almost 1.3 million beneficiaries.

President Trump’s Medicare chief, Seema Verma, listened to the complaints and voiced that something does have to change in order to help the beneficiaries. She stated, “We’ve talked a lot about the operational changes that we’re making, the policy changes that we’re making, but at the end of the day, this is about putting patients first.” If the 3-day rule does in fact change, the costly bill following a hospital visit will be alleviated, and many beneficiaries will be happy.

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