Study: Hospital costs may be higher for poor Medicare patients
- A new study suggests that lower-income Medicare beneficiaries may be paying more out-of-pocket for hospital care than their wealthier counterparts, Reuters reported.
- Researchers analyzed 2013 Medicare claims for more than 67,000 patients with over 132,000 hospital stays where they were observed but never officially admitted. They found the poorest 25% of patients were 24% more likely to have three or more observation stays a year, compared with the wealthiest 25%.
- The study, published in the American Journal of Medicine, included 97% of counties in the U.S. The average household income was $51,872.
While Medicare requires people to pay a fixed one-time fee when they are admitted to the hospital, the coverage is quite generous and includes inpatient care, post-discharge acute nursing care and repeat hospitalizations. By contrast, patients who are held for observation must pay the fixed out-of-pocket fee as well as 20% of any bills for services they receive while in the hospital and all of the cost of certain drugs.
If poorer Medicare beneficiaries are more likely to be kept for observation than wealthier beneficiaries, they will end up paying more out-of-pocket for their hospital care.
According to a 2014 Kaiser Family Foundation analysis, Medicare enrollees spent on average $4,734 out-of-pocket for healthcare in 2010. Those with significant healthcare needs averaged $11,500 for their healthcare needs.
And a report by the HHS Inspector General, also from 2014, found the Medicare beneficiaries receiving outpatient care at critical access hospitals pay two to six times more than patients at other hospitals. In 2012, beneficiaries paid bout $1.5 billion of the $3.2 billion in outpatient services rendered at critical access hospitals. While supplemental insurance policies could help to reduce patients’ share of costs, one in seven Medicare recipients lacked such policies, the study said.
- Reuters Poor Medicare patients may spend more on hospital stays
- American Journal of Medicine Observation Status, Poverty and High Financial Liability among Medicare Beneficiaries