senate Bill S3926A

Signed By Governor
2013-2014 Legislative Session

Requires general hospitals to provide notice to patients placed in observation services and explain the implications thereof

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Archive: Last Bill Status - Signed by Governor


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Oct 21, 2013 signed chap.397
Oct 09, 2013 delivered to governor
Jun 17, 2013 returned to senate
passed assembly
ordered to third reading rules cal.256
substituted for a7257a
referred to health
delivered to assembly
passed senate
Jun 05, 2013 amended on third reading 3926a
May 06, 2013 advanced to third reading
May 01, 2013 2nd report cal.
Apr 30, 2013 1st report cal.477
Feb 27, 2013 referred to health

Votes

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Bill Amendments

Original
A (Active)
Original
A (Active)

Co-Sponsors

S3926 - Bill Details

See Assembly Version of this Bill:
A7257A
Law Section:
Public Health Law
Laws Affected:
Add §2805-w, Pub Health L

S3926 - Bill Texts

view summary

Requires general hospitals to provide notice to patients placed in observation services and explain the implications thereof.

view sponsor memo
BILL NUMBER:S3926

TITLE OF BILL: An act to amend the public health law, in relation to
patient notice of the provision of observation services

PURPOSE: Requiring general hospitals to provide notice to patients
placed in observation services and explain the implications thereof

SUMMARY OF PROVISIONS:

Section one amends the Public Health Law by adding a new section,
2805-v. Subdivision one requires every general hospital to provide
patients placed into observation services with verbal and written
notice within 24 hours of such placement explaining that the patient
is under observation status and has not been admitted to the hospital.
The signature of the patient or their legal representative must be
obtained to acknowledge receipt. The notice must include: when the
observation services began, how observation status may affect the
patient's Medicare, Medicaid, and/or private insurance coverage for
the current hospital services, and contact information for further
understanding. Subdivision two provides that the commissioner shall
develop and make available a standard notice form within 30 days of
the effective date to be used by all general hospitals after that
date.

Section two provides that the act shall take effect immediately.

JUSTIFICATION: A little known change at the federal level is having a
large impact on hospitals and, in turn, their patients. Patients who
think they have been "admitted" to the hospital, are finding out after
the fact that they were being "observed" instead. This difference in
status comes despite the fact that they have likely been moved from
the emergency room to a bed in the hospital just like an admitted
patient. Unfortunately, the consequences for Medicare patients are
particularly severe as Medicare reimburses differently for outpatient
(i.e. hospital observation services). Additionally, the time a patient
spends in a hospital under observation status does not qualify them
for skilled nursing facility care they may require to rehabilitate.
This bill requires that patients be notified verbally and in writing
if they are placed in observation status and requires the Department
of Health to establish a standard notification form.

The federal Centers for Medicare and Medicaid Services (CMS) has begun
requiring hospitals to make a distinction between admitting a patient
and observing a patient to further evaluate the patient's condition
and need for an admission Hospitals are being audited to enforce these
provisions and where CMS decides that someone should have been in
"observation" status they are disallowing any Medicare payment to the
hospitals Since these audits have begun, reports have shown a national
increase in the number of patients that hospitals are placing under
observation care However, when a physician orders that a patient
receive observation care, the patient's status is that of an
outpatient and they lose important Medicare benefits.

As an outpatient, Medicare coverage comes under Part B (doctors'
services and outpatient care) rather than under Part A (hospital


insurance) as it would for an admitted patient This results in some
patients paying more out of pocket due to higher co-payments for
in-hospital services, especially if they need prescriptions drugs
that, in this situation would be covered under Part A and not under
Part B Additionally, under Medicare rules, patients qualify for full
coverage of the first 20 days of post-hospital rehab care in an
approved skilled nursing facility only after having spent three full
days in the hospital as an admitted patient. Thus, a patient who has
been under observation services (for all or part of that time) would
be responsible for the cost of the nursing facility care subsequent to
the patient's time in observation.

Patients are often not notified of their status and do not realize the
difference in out of pocket expense until it comes time to pay for the
services. This bill will ensure that patients are notified when they
are placed in observation status. of the differences that accompany
their status as a patient receiving observation services as opposed to
an admitted patient.

LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This bill shall take effect immediately.

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                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3926

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 27, 2013
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Health

AN ACT to amend the public health law, in relation to patient notice  of
  the provision of observation services

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The public health law is amended by adding  a  new  section
2805-v to read as follows:
  S  2805-V.  PATIENT  NOTICE  OF OBSERVATION SERVICES. 1. EVERY GENERAL
HOSPITAL SHALL PROVIDE PATIENTS WHO ARE PLACED INTO OBSERVATION SERVICES
WITH A VERBAL AND WRITTEN NOTICE WITHIN TWENTY-FOUR HOURS OF SUCH PLACE-
MENT THAT THE PATIENT IS NOT ADMITTED  TO  THE  HOSPITAL  AND  IS  UNDER
OBSERVATION  STATUS. SUCH NOTICE SHALL BE SIGNED BY THE PATIENT OR THEIR
LEGAL REPRESENTATIVE TO ACKNOWLEDGE RECEIPT AND SHALL INCLUDE,  BUT  NOT
BE LIMITED TO, INFORMATION AND AN EXPLANATION OF:
  (A) WHEN THE OBSERVATION SERVICES BEGAN;
  (B) HOW OBSERVATION STATUS MAY AFFECT THE PATIENT'S MEDICARE, MEDICAID
AND/OR  PRIVATE  INSURANCE  COVERAGE  FOR THE CURRENT HOSPITAL SERVICES,
INCLUDING MEDICATIONS AND OTHER  PHARMACEUTICAL  SUPPLIES,  AS  WELL  AS
COVERAGE FOR ANY SUBSEQUENT DISCHARGE TO A SKILLED NURSING FACILITY; AND
  (C)  WHO THE PATIENT CAN CONTACT TO BETTER UNDERSTAND THE IMPLICATIONS
OF BEING PLACED IN OBSERVATION STATUS.
  2. THE COMMISSIONER SHALL DEVELOP AND MAKE AVAILABLE A STANDARD NOTICE
FORM AS DESCRIBED IN THIS SECTION WITHIN THIRTY DAYS  OF  THE  EFFECTIVE
DATE  OF  THIS SECTION TO BE USED BY ALL GENERAL HOSPITALS AND SIGNED BY
PATIENTS PLACED IN OBSERVATION STATUS AFTER THAT DATE.
  S 2. This act shall take effect immediately.


 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05275-01-3

Co-Sponsors

S3926A (ACTIVE) - Bill Details

See Assembly Version of this Bill:
A7257A
Law Section:
Public Health Law
Laws Affected:
Add §2805-w, Pub Health L

S3926A (ACTIVE) - Bill Texts

view summary

Requires general hospitals to provide notice to patients placed in observation services and explain the implications thereof.

view sponsor memo
BILL NUMBER:S3926A

TITLE OF BILL: An act to amend the public health law, in relation to
patient notice of the provision of observation services

PURPOSE:

Requiring general hospitals to provide notice to patients placed in
observation services and explain the implications thereof

SUMMARY OF PROVISIONS:

Section one amends the Public Health Law by adding a new section,
2805-w. Subdivision one requires every general hospital to provide
patients placed into observation services with oral and written notice
within 24 hours of such placement explaining that the patient is under
observation status and has not been admitted to the hospital. The
signature of the patient or their legal representative must be
obtained to acknowledge receipt. The notice must include a statement
informing the patient that observation status may affect the patient's
Medicare, Medicaid, and/or private insurance coverage and that the
patient should contact their insurer. Subdivision two provides that
the commissioner shall develop guidance on the notice.

Section two provides the effective date.

JUSTIFICATION:

A little known change at the federal level is having a large impact on
hospitals and, in turn, their patients. Patients who think they have
been "admitted" to the hospital, are finding out after the fact that
they were being "observed" instead. This difference in status comes
despite the fact that they have likely been moved from the emergency
room to a bed in the hospital just like an admitted patient.
Unfortunately, the consequences for Medicare patients are particularly
severe as Medicare reimburses differently for outpatient (i.e.
hospital observation services). Additionally, the time a patient
spends in a hospital under observation status does not qualify them
for skilled nursing facility care they may require to rehabilitate.
This bill requires that patients be notified verbally and in writing
if they are placed in observation status and requires the Department
of Health to establish a standard notification form.

The federal Centers for Medicare and Medicaid Services (CMS) has begun
requiring hospitals to make a distinction between admitting a patient
and observing a patient to further evaluate the patient's condition
and need for an admission. Hospitals are being audited to enforce
these provisions and where CMS decides that someone should have been
in "observation" status they are disallowing any Medicare payment to
the hospitals. Since these audits have begun, reports have shown a
national increase in the number of patients that hospitals are placing
under observation care. However, when a physician orders that a
patient receive observation care, the patient's status is that of an
outpatient and they lose important Medicare benefits.

As an outpatient, Medicare coverage comes under Part B (doctors'
services and outpatient care) rather than under Part A (hospital


insurance) as it would for an admitted patient. This results in some
patients paying more out of pocket due to higher co-payments for
in-hospital services, especially if they need prescription drugs that,
in this situation would be covered under Part A and not under Part B.
Additionally, under Medicare rules, patients qualify for full coverage
of the first 20 days of post-hospital rehab care in an approved
skilled nursing facility only after having spent three full days in
the hospital as an admitted patient. Thus, a patient who has been
under observation services (for all or part of that time) would be
responsible for the cost of the nursing facility care subsequent to
the patient's time in observation.

Patients are often not notified of their status and do not realize the
difference in out of pocket expense until it comes time to pay for the
services. This bill will ensure that patients are notified when they
are placed in observation status. of the differences that accompany
their status as a patient receiving observation services as opposed to
an admitted patient.

LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

None.

EFFECTIVE DATE:

This bill shall take effect immediately provided the hospital notices
shall be required 90 days after enactment.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 3926--A
    Cal. No. 477

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 27, 2013
                               ___________

Introduced  by  Sens.  HANNON, FELDER -- read twice and ordered printed,
  and when printed to  be  committed  to  the  Committee  on  Health  --
  reported  favorably  from  said committee, ordered to first and second
  report, ordered to a third reading,  amended  and  ordered  reprinted,
  retaining its place in the order of third reading

AN  ACT to amend the public health law, in relation to patient notice of
  the provision of observation services

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The  public health law is amended by adding a new section
2805-w to read as follows:
  S 2805-W. PATIENT NOTICE OF OBSERVATION  SERVICES.  1.  EVERY  GENERAL
HOSPITAL SHALL PROVIDE PATIENTS WHO ARE PLACED INTO OBSERVATION SERVICES
BY  SUCH GENERAL HOSPITAL WITH AN ORAL AND WRITTEN NOTICE WITHIN TWENTY-
FOUR HOURS OF SUCH PLACEMENT THAT THE PATIENT IS  NOT  ADMITTED  TO  THE
HOSPITAL  AND  IS UNDER OBSERVATION STATUS. SUCH WRITTEN NOTICE SHALL BE
SIGNED BY THE PATIENT OR THE PATIENT'S LEGAL REPRESENTATIVE TO  ACKNOWL-
EDGE  RECEIPT  AND  SHALL  INCLUDE, BUT NOT BE LIMITED TO, THE FOLLOWING
INFORMATION:
  (A) A STATEMENT THAT OBSERVATION STATUS MAY AFFECT THE PATIENT'S MEDI-
CARE, MEDICAID AND/OR PRIVATE INSURANCE COVERAGE FOR THE CURRENT  HOSPI-
TAL  SERVICES,  INCLUDING MEDICATIONS AND OTHER PHARMACEUTICAL SUPPLIES,
AS WELL AS COVERAGE FOR ANY SUBSEQUENT DISCHARGE TO  A  SKILLED  NURSING
FACILITY OR HOME AND COMMUNITY BASED CARE; AND
  (B)  THAT  THE  PATIENT  SHOULD  CONTACT  HIS OR HER INSURANCE PLAN TO
BETTER UNDERSTAND  THE  IMPLICATIONS  OF  BEING  PLACED  IN  OBSERVATION
STATUS.
  2.  THE  COMMISSIONER SHALL DEVELOP AND MAKE AVAILABLE GUIDANCE ON THE
NOTICE AS DESCRIBED IN THIS SECTION.
  S 2. This act shall take effect immediately, except that subdivision 1
of section 2805-w of the public health law, as added by section  one  of
this  act,  shall  take effect on the ninetieth day after this act shall
have become a law.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05275-06-3

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