Study: Poorer Patients May Be Hardest Hit By Observational Hospital Care

By Consumers for Quality Care, on August 16, 2017

Study: Poorer Patients May Be Hardest Hit By Observational Hospital Care

A new study published in the American Journal of Medicine suggests that poorer patients are spending more for hospital care.  While Medicare patients pay a fixed amount for inpatient treatment, the charges incurred when patients are not sick enough for inpatient care can be higher. Reuters reports:

[P]eople who aren’t sick enough for an inpatient admission may be kept in the hospital for observation, which not only carries a one-time out-of-pocket fee but also requires patients to pay 20 percent of the bills for hospital services and pick up the tab for certain drugs.  

Additionally, the study found that poorest Medicare patients fell under the observational status more often.

Compared with the wealthiest 25 percent of patients, the people in the poorest quartile were 24 percent more likely to be hospitalized for at least three observation stays per year, the study found. The risk of high out-of-pocket costs was lowest for the wealthiest patients, and peaked for people who were poor[.]

While researchers had previously known that multiple observational stays result in high costs for Medicare patients, they believe this study is the first to demonstrate that the individuals least equipped to pay for these bills are at the greatest risk of incurring them.

Doctors point out that many patients may not understand the costs differences, between inpatient and observational care.

More research is needed to make it easier for patients to grasp, Sheehy said… “No study to date has been able to compare cost of inpatient to (observation) stays for the exact same set of services and hospital length of stay, and none have been able to account for all costs a patient may incur,” Sheehy said. “As a physician, I cannot accurately tell the patient I am caring for what they will pay for an observation hospitalization compared to inpatient.”

The study was wide reaching, including patients from 97% of counties nationwide.