Beginning Aug. 6, hospitals and critical access hospitals must to provide a written notice and an oral explanation when patients receive observation services for more than 24 hours. The notice must be provided no later than 36 hours after observation services begin.
The Notice of Observation Treatments and Implications for Care Eligibility Act (the NOTICE Act), which was passed by Congress in July 2015, sets the effective date as one year after it was signed into law by President Obama on Aug. 6, 2015.
In the Inpatient Prospective Payment System (IPPS) proposed rule, CMS announced that it has developed a standardized notice, the Medicare Outpatient Observation Notice (MOON), to ensure that hospitals inform the patients in the same way. CMS submitted an English version to the Office of Management and Budget for approval and intends to develop a version of the notice in Spanish as soon as the English version is approved.
The notice must explain that the person receiving observation services is an outpatient and has not been admitted to the hospital and must include the reason patients are receiving observation services. It must explain the implications of receiving outpatient services, include the potential out-of-pocket costs, and how an observation stay affects the eligibility requirements for Medicare to cover a skilled nursing facility stay.
Hospitals are required to provide an oral explanation of what the notice means, preferably at the same time the written notice is delivered.
The notice must be signed by the patient or a person acting on his or her behalf. If the signature is refused, the staff member who presented the notice must sign a certification statement that includes the time and date the notice was presented.
The proposed rule says hospitals are responsible for providing translators, interpreters, or assistive technology to ensure that all patients can understand the notice.
Some states already require a written notice of observation services, but CMS is requiring it nationwide. (For more information on observation services versus an inpatient admission, see the April 2016 issue of Hospital Case Management.)
Delivery of the notice should not be the responsibility of case managers, but should be handled by patient access since the law requires hospitals to give patients information on their financial responsibilities, says Toni Cesta, RN, PhD, FAAN, partner and consultant in North Bellmore, NY-based Case Management Concepts.
“If patients have questions about their insurance coverage, the case managers will have to call patient access,” she adds.
However, Cesta predicts that case management will wind up with the responsibility of delivering the MOON, just as the department typically is charged with delivering the Important Message from Medicare. “When hospitals don’t know what to do with something, it’s usually handed to case management,” she says.
Beginning Aug. 6, hospitals and critical access hospitals must to provide a written notice and an oral explanation when patients receive observation services for more than 24 hours.
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