Improving Access to Medicare Coverage Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 1682 To amend title XVIII of the Social Security Act to count a period of receipt of outpatient observation services in a hospital toward satisfying the 3-day inpatient hospital stay requirement for coverage of skilled nursing facility services under Medicare, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 12, 2019 Mr. COURTNEY (for himself and Mr. THOMPSON of Pennsylvania) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the com- mittee concerned A BILL To amend title XVIII of the Social Security Act to count a period of receipt of outpatient observation services in a hospital toward satisfying the 3-day inpatient hos- pital stay requirement for coverage of skilled nursing facility services under Medicare, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Improving Access to 4 Medicare Coverage Act of 2019’’. 5 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 2 •HR 1682 IH SEC. 2. FINDINGS. 1 Congress finds the following: 2 (1) Medicare requires beneficiaries to be hos- 3 pitalized for medically necessary inpatient hospital 4 care for at least three consecutive days before cov- 5 ering post-hospital care in a skilled nursing facility 6 under section 1861(i) of the Social Security Act (42 7 U.S.C. 1395x(i)). 8 (2) Often patients remain under ‘‘observation 9 status’’ in the hospital for several days and these ob- 10 servation days are not counted toward the 3-day 11 stay requirement because they are considered out- 12 patient days. 13 (3) Hospitals’ use of observation stays has in- 14 creased sharply since 2006. According to the March 15 2014 report of the Medicare Payment Advisory 16 Commission, outpatient visits, many of which are ob- 17 servation stays, increased 28.5 percent between 18 2006 and 2012, with a simultaneous 12.6-percent 19 decrease in inpatient stays over this same six-year 20 time period. A study published in Health Affairs 21 found a 34-percent increase in the ratio of observa- 22 tion stays to inpatient admissions between 2007 and 23 2009, leading the researchers to conclude that out- 24 patient observation status was becoming a substitute 25 for inpatient admission. The same study also docu- 26 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 3 •HR 1682 IH mented increases in long-stay outpatient status, in- 1 cluding an 88-percent increase in observation stays 2 exceeding 72 hours. 3 (4) To health care providers, care provided dur- 4 ing observation is indistinguishable from the care 5 provided to inpatients and all medically necessary 6 care is provided, regardless of patient status. Bene- 7 ficiaries are generally not informed of their inpatient 8 or outpatient status and assume that they are inpa- 9 tients when they are placed in a hospital bed, only 10 to find out that such care was not counted for pur- 11 poses of satisfying eligibility requirements for medi- 12 cally prescribed Medicare coverage of post-hospital 13 care in a skilled nursing facility. 14 (5) Older Americans and people with disabilities 15 who are hospitalized but do not meet the 3-day inpa- 16 tient hospital stay requirement simply because they 17 were placed in ‘‘outpatient observation status’’ for 18 some or all of their hospital stay (even when their 19 total actual stay exceeds three days in the hospital) 20 can face a significant and unexpected financial bur- 21 den, which can amount to thousands of dollars, for 22 skilled nursing facility care. Among beneficiaries 23 who received care in a skilled nursing facility that 24 Medicare did not cover, the average out-of-pocket 25 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 4 •HR 1682 IH charges were more than $10,000, according to the 1 Office of Inspector General of the Department of 2 Health and Human Services. 3 (6) The Centers for Medicare & Medicaid Serv- 4 ices (CMS) attempted to provide hospitals with clar- 5 ity on which patients should be categorized as inpa- 6 tients in the inpatient hospital payment rule for fis- 7 cal year 2014. However, this rule fails Medicare 8 beneficiaries because it does not address the problem 9 and explicitly states that days spent in observation 10 status do not count for purposes of satisfying the 3- 11 day inpatient stay requirement. 12 (7) Because of CMS’ policy which indicates 13 days under observation do not count towards the 3- 14 day inpatient stay requirement, some patients under 15 observation and their families will continue to face 16 a significant, often insurmountable financial burden 17 if they need skilled nursing care after their hospital 18 stay. 19 (8) This Act updates Medicare policy by deem- 20 ing patients under observation as inpatients for the 21 purposes of satisfying the Medicare 3-day inpatient 22 stay requirement. This Act does not repeal the 3-day 23 inpatient stay requirement; rather it simply expands 24 the Secretary’s administrative definition of ‘‘inpa- 25 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 5 •HR 1682 IH tient’’ for purposes of the 3-day stay requirement to 1 include time spent under observation. As such, it is 2 not a reprise of the Medicare Catastrophic Coverage 3 Act of 1988, which repealed the 3-day requirement. 4 This Act simply restores the original objective of the 5 3-day rule, which was to ensure Medicare coverage 6 of skilled nursing facility stays following hospital 7 care for patients who stayed in the hospital for 3 8 days. 9 (9) It is the intent of this Congress, through 10 this Act, to allow access to skilled nursing care for 11 the population of beneficiaries who meet medical ne- 12 cessity requirements for such care, but who do not 13 satisfy the 3-day inpatient stay requirement simply 14 because some or all of their time in the acute care 15 hospital is characterized as ‘‘outpatient observation 16 status’’ for billing purposes. 17 (10) It is the understanding of Congress that 18 the Secretary of Health and Human Services will 19 monitor patterns of behavior to ensure that pro- 20 viders deliver appropriate and needed levels of care. 21 (11) The Office of the Inspector General of the 22 Department of Health and Human Services is sup- 23 portive of counting hospital observation days to- 24 wards the 3-day inpatient stay requirement. In addi- 25 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 6 •HR 1682 IH tion, in September 2013, the Congressionally estab- 1 lished Commission on Long-Term Care rec- 2 ommended that CMS’ count time spent in observa- 3 tion status toward meeting Medicare’s 3-day stay re- 4 quirement. In addition, in a December 2016 report, 5 the Office of the Inspector General of the Depart- 6 ment of Health and Human Services found that an 7 increased number of Medicare beneficiaries classified 8 as outpatients are paying more for care that is sub- 9 stantively similar, and have limited access to skilled 10 nursing facility care due to their patient status. 11 SEC. 3. COUNTING A PERIOD OF RECEIPT OF OUTPATIENT 12 OBSERVATION SERVICES IN A HOSPITAL TO- 13 WARD THE 3-DAY INPATIENT HOSPITAL STAY 14 REQUIREMENT FOR COVERAGE OF SKILLED 15 NURSING FACILITY SERVICES UNDER MEDI- 16 CARE. 17 (a) IN GENERAL.—Section 1861(i) of the Social Se- 18 curity Act (42 U.S.C. 1395x(i)) is amended by adding at 19 the end the following: ‘‘For purposes of this subsection, 20 an individual receiving outpatient observation services 21 shall be deemed to be an inpatient during such period, 22 and the date such individual ceases receiving such services 23 shall be deemed the hospital discharge date (unless such 24 VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS 7 •HR 1682 IH individual is admitted as a hospital inpatient at the end 1 of such period).’’. 2 (b) EFFECTIVE DATE.—The amendment made by 3 subsection (a) shall apply to receipt of outpatient observa- 4 tion services beginning on or after January 1, 2019, but 5 applies to a period of post-hospital extended care services 6 that was completed before the date of the enactment of 7 this Act only if an administrative appeal is or has been 8 made with respect to such services not later than 90 days 9 after the date of the enactment of this Act. Notwith- 10 standing any other provision of law, the Secretary of 11 Health and Human Services may implement such amend- 12 ment through an interim final regulation, program in- 13 struction, or otherwise. 14 Æ VerDate Sep 11 2014 20:55 Mar 28, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H1682.IH H1682 khammond on DSKBBV9HB2PROD with BILLS