Q&A: Patient Financial Responsibility for Observation

Q: I work for a critical access method II billing facility. According to the verbiage I have read on the Medicare Outpatient Observation Notice (MOON), patients will not have any more financial responsibility than inpatient deductibles if they are in observation.

However, I have found that not to be true. The hospital had one patient in observation for 30 hours. The total charges were $12,496 and Medicare stated the patient would be responsible for $2,212. For another patient with 40 hours of observation and charges totaling $10,199, Medicare charged the patient $1,639.

What advice would you give on verbiage to use when explaining the patient’s financial responsibility for observation?

A: The MOON is not something we can change at will. It is likely to be different prior to the go-live date. Critical access hospital patients still take a substantial hit when ordered to receive observation services and subsequent admission. I haven’t seen CMS address this yet, but surely it will. I would be sure to comment to CMS before June 17, 2016, deadline. 

Deborah Hale, CCS, CCDS, president and CEO of Administrative Consultant Service, LLC, in Shawnee, Oklahoma, answered this question.

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