Appeal when a hospital changes your status from an inpatient to an outpatient with observation services

Earlier this year, the US Court of Appeals for the Second Circuit issued a decision on Barrows v. Becerra, a class action suit filed by Medicare Part A beneficiaries who claimed they were denied their due process rights because there was no administrative review process for the reclassification of their hospital admission status from inpatient to outpatients receiving observation services. The appeals court affirmed a district court finding that the plaintiffs’ due process rights were violated when the utilization review committee changed their status from inpatient to outpatient with observation services without a process for the beneficiary to appeal that decision.

CMS has announced a ‘Coming Soon’ process for beneficiary appeals. The process has yet to be defined by CMS, but a few qualifying factors have already been published. From Medicare.gov, How do I file an appeal:

“You’ll have the right to file an appeal when a hospital changes your status from an inpatient to an outpatient, if you meet all of these requirements:

  • You were admitted to the hospital as an inpatient on or after January 1, 2009.
  • The hospital changed your status from “inpatient” to “outpatient” and after the status change you were an outpatient getting observation services.
  • You got a Medicare Outpatient Observation Notice (MOON) or a Medicare Summary Notice (MSN) telling you that observation services aren’t covered under Part A (Hospital Insurance).

And you ALSO meet of these 2 requirements:

  1. You weren’t enrolled in Part B (Medical Insurance) coverage when you were hospitalized, OR
  2. You had Part B coverage when you were hospitalized, and you:
    • Stayed at the hospital for 3 or more days in a row, but were not an inpatient for 3 days, AND
    • Were admitted to a skilled nursing facility during the 30 days after your hospital stay (or, it’s been less than 30 days since your hospital stay).”

No word yet on how a successful appeal may impact the payment the hospital may have already received on the claim.

President at Association for Healthcare Denial and Appeal Management | dwilson@intersecthealthcare.com | Website | + posts

Denise serves as the Senior Vice President at Denial Research Group – AppealMasters. Denise is also President of The Association for Healthcare Denial and Appeal Management. Denise is a Registered Respiratory Therapist, Registered Nurse, and holds a Master’s degree in Management Information Systems from the University of Illinois, Springfield.

Denise has over thirty years of experience in healthcare, including clinical management, education, compliance, and appeal writing. Denise has extensive experience as a Medical Appeals Expert and has personally managed hundreds of Medicare, Managed Medicare, and Commercial appeal cases and presented hundreds of cases at the Administrative Law Judge level.

Denise is a nationally known speaker and dynamic educator on Medicare and Commercial appeals processes, payer behaviors, standards of care, appeal template development, and building a road map to drive the payer to a decision in the provider’s favor. She has educated thousands of healthcare professionals around the country in successfully overturning medical care denials.