A story about out-of-pocket spending for hospital care for Medicare beneficiaries quoted Ann Sheehy, MD, MS, associate professor and head, Hospital Medicine.

The analysis of Medicare claims data for 132,000 hospital stays in 2013, which was conducted by researchers in Delaware and Pennsylvania, found that patients with lower income were more likely to have their hospital stays classified as observation status, which incur higher out-of-pocket costs, rather than being admitted as inpatients. 

The risk of high out-of-pocket costs was lowest for the wealthiest patients, and peaked for people who were poor, but not the very poorest. 

One limitation of the study was that researchers couldn't account for which patients might have qualified for additional Medicaid coverage. However, the work highlighted a distinction between out-of-pocket costs for inpatient versus observation stays and their correlation with household income level. 

“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,” said Dr. Sheehy. 

“As a physician, I cannot accurately tell the patient I am caring for what they will pay for an observation hospitalization compared to inpatient.”

Resources:

• "Poor Medicare patients may spend more on hospital stays," Reuters News, August 9, 2017
• Goldstein JN, Zhang Z, Schwartz JS, Hicks LR. 2017. Observation Status, Poverty, and High Financial Liability Among Medicare Beneficiaries. American J Med. [Epub ahead of print]