John O'Connor
John O’Connor

There are many odd animals roaming our healthcare industrial complex. But few are more bizarre than Medicare’s three-day rule. Or more deserving of extinction.

All across our nation, this duck-billed platypus of a requirement (and the con game it inspires) is helping to bankrupt many of our nation’s seniors — and the skilled care facilities that care for them.

Imagine, if you will, that you have been in a hospital for a week or so, and now require some rehab care at a nursing home. Well, it’s been seven days at Nonprofit Memorial, so you should have more than met Medicare’s three-day hospital stay requirement, right?

Maybe yes, maybe no. It sort of depends.

The hospital and the physician it assigned to care for you may determine that you were actually an “observation outpatient” for most or all of those seven days. So the three-day hospital stay requirement was never met, despite all evidence to the contrary. Yes, that’s a pretty dubious decision that may cost you thousands and thousands of dollars, but them’s the breaks.

Okay, so it’s a rigged game. But at least the courts will be able to see through this little charade and straighten things out, right? Not, apparently, if it’s a federal court in Connecticut that gets involved. There, a group of patients with a similar narrative were told to tell their story walking.

Essentially, they were informed that they didn’t have the legal standing to question the rule. And besides, the doctor knows best.

Are you kidding me?

I long ago abandoned the naive notion that common sense and shame are enough to corral unchecked hubris. But I do believe that leverage can be, as they say, a real game changer. And one of the most effective checks against judges who are biased, misinformed or simply on the take is this: new laws.

Luckily, a bill to end the disgraceful three-day rule was recently introduced by Rep. Jim McDermott (D-WA). It’s not perfect, but it offers a huge improvement.

Will it pass this Congress? That’s doubtful. But it’s a start. Besides, karma can be a funny thing. Perhaps when one of these judges is on the business end of an observation outpatient decision, he’ll spare the victim a stern lecture. 


John O’Connor is Editorial Director at McKnight’s. Follow him on Twitter @Ltcritr.