ALBANY, N.Y. - For many dependent on Medicare, "observation stay" has become an expensive phrase for thousands of elderly patients in New York, now Senator Chuck Schumer is hoping to fix that.
When Ike Cassuto had a bad fall and broke his pelvis, he thought for sure any rehabilitation would be covered by Medicare. Despite staying at a hospital for four days, being categorized as "observation status" meant every penny of his three week, $6,000 rehabilition would have to come out of his own pocket.
"I was shocked, outraged. I couldn't believe it. I had never heard of 'observation status' before," said Cassuto.
Under current Medicare rules, if you're admitted at a hospital as an inpatient for three consecutive days, Medicare helps pay for rehabilitation. But if it's considered "observation stay," any post-acute care bills go straight to you.
"When I heard it the first time, I had to hear it ten times more. I could hardly believe it, but then I got fired up," said Ike's wife, Thalia.
Senator Schumer, D-NY, has introduced a bill to fix what he calls 'a flawed law' affecting hundreds of thousands of seniors across the country.
"Frankly, it's unconscionable that so many elderly are being denied coverage for a technical loophole that Medicare is pushing," said Schumer.
The senator wants it so "observation status" is considered inpatient care.
Hospitals say they can face penalties if they categoize patients incorrectly.
"It's a problem that puts patients seeking much-needed care at odds with hospitals that are trying to follow reimbursement regulations," said James Reed, President and CEO of St. Peter's Health Partners.
While the senator could not tell us what the change would cost to an already burdened system, he did mention there are cuts that can be made.
"There are a lot of places you can save, but where you should not be saving is on the backs of people who need healthcare," said Schumer.
The senator is very optimistic his bill will pass.
The Cassutos are appealing to try and get some of their money back, but even if they don't, they said they're fighting so others who cannot afford to pay still get the care they need.