Majority Press

Senate Aging Committee Tackles Hospital 'Observation Status' Crisis

Top government officials and private sector experts join Senators to examine how hospital use of observation status affects patients and taxpayers

        WASHINGTON – This afternoon, U.S. Senators Susan Collins and Claire McCaskill will lead a bipartisan Senate panel examining the dramatic growth in the use of “observation status” by hospitals and the effects it has on patients and the health care industry.   Tori Gaetani of Beacon Health, which is part of Eastern Maine Healthcare Systems, has accepted Senator Collins’ invitation to testify.

        In recent years, hospitals have increasingly placed Medicare patients “under observation” as opposed to admitting them—which has, in some cases, negatively affected patients. This problem has been further complicated by unclear government policies and audits designed to stamp out waste, which may have incentivized hospitals to overly rely on the use of observation status.  At issue is the fact that if a senior spends time in the hospital under observation status, Medicare will not pay for skilled nursing care that a senior may need after leaving the hospital. 

        The hearing, entitled “Challenging the Status Quo: Solutions to the Hospital Observation Stay Crisis,” will include input from all key stakeholders and examine various proposals that are designed to solve the problem of over-reliance on the use of observation status by hospitals.

        Beacon Health is part of a national pilot program to enable Medicare patients to be treated at a skilled nursing facility under Medicare without the hospital inpatient stay requirement. Ms. Gaetani will discuss how the program has improved care of seniors and reduced overall costs of care.


The Aging Committee hearing will take place today, May 20, at 2:15pm ET and will be livestreamed HERE.

        Also testifying at the hearing will be Sean Cavanaugh, from the Centers for Medicare and Medicaid Services; Mark Miller, Executive Director of the Medicare Payment Advisory Commission; Dr. Jyortirmaya Nanda, of the SSM Health; and Spencer Young of Health Data Insights.

Wednesday, May 20

2:15pm ET

Dirksen Senate Office Building – Room 562