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Coalition Urges Congress to Pass Legislation Safeguarding Medicare Beneficiaries' Skilled Nursing Care

For Immediate Release
October 21, 2012


Terry Berthelot
Toby Edelman

Washington, DC. – A Congressional briefing on "observation status," sponsored by Congressman Joe Courtney (D. CT), was held yesterday afternoon to examine Medicare beneficiaries' being denied Medicare coverage for care in a skilled nursing facility (SNF) when their prior stay in an acute care hospital is labeled "outpatient observation" rather than inpatient. The Center for Medicare Advocacy organized and chaired the briefing for Congressional staff. A broad coalition of organizations urged Congress to support pending legislation which would ensure a full and fair Medicare program.

Observation status refers to the increasingly common hospital practice of putting patients in beds and providing them with medical and nursing care, diagnostic tests, treatments, services, food, and a wrist band – but calling them outpatients, not inpatients.

"The difference in terminology makes all the difference in the world," said Center for Medicare Advocacy senior policy attorney Toby S. Edelman. "Inpatients qualify for Medicare coverage of their nursing home care; outpatients don't."

"All time in a hospital – whether called inpatient or outpatient – should be counted when the Medicare program decides whether a beneficiary qualifies for coverage in a SNF," Ms. Edelman continued. "Beneficiaries who have paid into the Medicare system for years should be able to get their nursing home care paid for when they need it, regardless of the label attached to their time in the hospital."

Ms. Edelman outlined the problem of observation status and called on Members of Congress to support the bipartisan legislation, the "Improving Access to Medicare Coverage Act of 2011," which is filed in both the House of Representatives (H.R. 1543) and the Senate (S. 818). She also called for support for Congressman Courtney's alternative efforts to secure an administrative resolution.

To illustrate the human side of a damaging practice, the Center's client Mrs. Lee Barrows of Connecticut described her husband's five-day stay in a Connecticut hospital as an observation patient and denial of Medicare payment for his subsequent SNF care, describing how:

He was taken to a room where he remained for eight days… on the fifth day a neurologist, flanked by [my husband's] doctor and a social worker, ushered me into the hall and said 'we're sorry, but your husband was never admitted.'  I was stunned with disbelief.  Wrist band, IV, PT, low-salt diet due to unusually high blood pressure… criteria for admission seemed obvious.  I tearfully blurted out that I was going to fight this, whereupon [they] both gave me the thumbs up sign saying that this happens once or twice a week."

Sandi Lubrant of Minnesota described her mother's similar experience. Unfortunately, there are thousands more stories like this from beneficiaries nationwide. The financial and emotional damages of this unethical practice are mounting.

Also testifying at the briefing were representatives of the American Health Care Association (Gail Sheridan, a nursing home operator from Minnesota) and the American Medical Directors Association (Eric Tangalos, M.D., professor of medicine at the Mayo Clinic).

The briefing and legislation are co-sponsored by AARP, the Alzheimer's Association, the American Medical Association, the American Medical Directors Association, Leading Age, and the National Committee to Preserve Social Security and Medicare.

For more information, please visit or contact attorney Terry Berthelot ( at 860-456-7790 or attorney Toby Edelman ( at 202-293-5760

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The Center for Medicare Advocacy, Inc., established in 1986, is a national nonprofit, nonpartisan organization that provides education, advocacy and legal assistance to help older people and people with disabilities obtain fair access to Medicare and necessary health care. The Center is headquartered in Connecticut with offices in Washington, DC and throughout the country.



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