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Bills Offer Two Approaches to Hospital Observation Status

The California Legislature is considering two bills taking different paths toward reconciling a vexing question dealing with observation status of patients in hospitals.

Labeling sick and injured people as in-patients or outpatients has several ramifications for hospitals ranging from reimbursement to staffing levels.

Health officials at CMS and lawmakers in several state legislatures are wrestling with the issue.

In California, one bill (SB 1269) by Sen. Jim Beall (D-San Jose) seeks to establish a firm deadline of 24 hours for hospitals to either declare individuals in-patients or out-patients.

Another bill (SB 1238) by Sen. Ed Hernandez (D-West Covina) creates several scenarios that would allow hospitals to go beyond the 24-hour limit.

Beall’s bill is sponsored by the California Nurses Association. Hernandez’s bill is sponsored by Tenet Healthcare. Both bills were placed in the Senate suspense file this month, effectively ending their chances for this year. But debate continues.

We asked stakeholders to assess the strengths and weaknesses of the two approaches.

We received responses from:

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.

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