Medicare Patients Get Split Decision in ‘Observation Status’ Row

Medicare patients who were admitted to a hospital, then changed to “observation status” after a utilization review, must be given an opportunity to challenge their reclassification, a federal court in Connecticut said.

Health and Human Services Secretary Alex M. Azar II must establish a procedure for these Medicare patients to protest hospitals’ decisions, the U.S. District Court for the District of Connecticut said Tuesday.

Patients originally admitted only for observation, however, don’t need to be afforded any such appeal right, the court said.

The long-running class action involves a dispute over Medicare’s obligation to pay for hospitalizations and long-term care ...