The American Medical Association will work to change the 72-hour hospitalization requirement for Medicare Part A coverage of skilled nursing care. Delegates approved this resolution at the AMA annual conference in Chicago on Monday.

Medicare should immediately cover a skilled nursing facility stay if a physician determines this is the best setting for care, according to the resolution.

Delegates criticized the Medicare policy in pre-vote debate, the Bureau of National Affairs reported. Some challenged the idea that the existing policy saves the Medicare program money, saying that properly managed skilled nursing care can be more cost-effective than hospitalization.

If the current policy is in fact saving Medicare money, it may be due to the increasing use of observation status, long-term care experts have suggested. If a patient is hospitalized under observation status rather than as an inpatient, the stay does not count toward the three-day requirement for Medicare coverage of a subsequent SNF say.

A pending court case in Connecticut, Bagnall vs. Sebelius, is challenging the use of observation stays while bills in the House and Senate would close the “observation stay loophole.” Building on existing bipartisan support,* Sen. Susan Collins (R-ME) recently signed on as a co-sponsor, and there may be another House Republican set to sign on as well, according to Center for Medicare Advocacy Executive Director Judith Stein.

“I hope it’s building some momentum,” Stein told McKnight’s.

*Editor’s Note: The original article has been altered slightly to clarify that these are not the first Republican sponsors of the bills.