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7/19/2010
CMS: Audits Force Hospitals to Label More Patients as 'Observation'

CMS: Audits Force Hospitals to Label More Patients as 'Observation'
More hospitals are classifying patients who stay multiple days as "observation cases," which is forcing some patients to shoulder high and unexpected medical bills, (Bloomberg BusinessWeek, 7/12) reports. Patients traditionally are classified as under "observation" if physicians do not render a diagnosis within the first 24 to 48 hours of care. However, Bloomberg BusinessWeek reports that hospitals increasingly extend the classification beyond the 48-hour mark to prevent CMS auditors from challenging inpatient cases, which cost the agency more money and are therefore subject to additional scrutiny. If CMS deems an admission "inappropriate," hospitals do not get reimbursed. As a result, observation cases in which patients were hospitalized for more than two days have doubled between 2006 and 2008.
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